What is affiliate marketing?

Affiliate Marketing is cost efficient, yet a proven method of delivering results, for both affiliates as well as web merchants. It is a joint effort, on the part of the Merchant as well as the affiliate. There are numerous affiliate sites, on the internet which all try to make that extra income, for their owners. Many people who realize, that there is a huge pile of money to be made in this, have started to get into this business. These people sometimes have not understood, the basics of affiliate marketing, but yet jump onto the bandwagon. The net result is, they make a lot of mistakes, some of which might prove very very costly for them in the long run.

Like any other business, Affiliate marketing involves Selling as well as Advertising. In fact both are a part, of the large game of marketing. Infact, selling and advertising are the core functions, of an affiliate marketing program. Without these 2 functions, you simply cannot garner a single pie, of this ever growing cash pile. Unfortunately, these 2 functions are usually mistaken, by most of the new entrants.

In affiliate marketing, compensation plans vary from programs to programs. Some compensate for every visitor, some for every lead generated, some for every sale made. Compensation is usually paid, as a fixed price or as a percentage of the sale that has been made. What is good for the Merchant is, he simply does not have to pay anyone, until a sale has been made.

These programs are usually run by affiliate networks, like Clickbank, group merchants and group affiliates. The network acts as a third party, between the merchants and the affiliates. The affiliate network is responsible, for delivering the technology that is responsible, for managing affiliates, to the merchant, as well as send out the commissions to the affiliates, who are part of the program.

Affiliate Marketing is fairly risk free. There is no need to carry products, which do not sell. You can just drop them, from the list of products that you offer. There are no long term contracts, with any of the merchants that will force you, to offer their products despite no sales being generated. With the Internet being all pervading, across the globe, there is simply no dearth of customers, for the products that you offer on the site. All you would have to do is build up targeted traffic, to your site using various strategies like Viral Marketing, Link Exchanges. The more the traffic you get, the more the chances of you making a profit.

The Merchant has a lot to gain, from affiliate marketing. The Merchant gets a wider market, to promote a product or a service, which might have not been possible with traditional advertising methods. Higher the number of affiliates, higher is the traffic and higher are the chances of converting, a visitor into a customer. The Merchant does not have many overheads, because of the pay-as-you-perform scheme.

There are many advantages for the affiliate too. The affiliate can earn by just having a link or an ad, to the Merchants website. The prospective customers will have to click on this link and make a purchase, for the affiliate to earn a commission. As soon as the prospect clicks on the link, he is taken to the Merchants website, where the sale is made. At this point the affiliate earns a commission and of course this is one of the easiest ways, to make a profit. As emphasized earlier, both the merchant as well as the affiliate, have a lot to gain in this mutually beneficial relationship.

If you are looking to earn a few bucks, while sitting at home, affiliate marketing is an excellent way. With a ready made product, that is proven and developed by the Merchant, all you have to do is get in the prospects, that would need this product. There are virtually no production costs involved and most of the affiliate programs are free to join, so there is no start up costs as well. If you have a theme for your website, be assured there is a product as well for that theme and of course there are affiliate programs for every product on this planet earth. So here is an excellent way, which will bring profits to both the affiliate, as well as the merchant.

It’s an absolute win win situation, for both the Merchant and the affiliate. Hand in hand, they can both emerge as winners. All you need to really work on, is a way to drive traffic to your website, where products and services are listed.