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What is Affiliate Marketing?
Affiliate marketing is an online advertising channel in which advertisers (online merchants that sell products or services) pay publishers (independent parties that promote the products or services of an advertiser on their Web site) only for results, such as a visitor making a purchase or filling out a form, rather than paying simply to reach a particular audience. This “pay-for-performance” model is in essence the modern version of the “finders’-fee” model, where individuals who introduce new clients to a business are compensated. The difference in the case of affiliate marketing is that advertisers only pay their publishers when the new client introduction results in a sale or a lead, making it a low-risk, high-reward environment for both parties.
Affiliate Marketing is one of the most popular method of marketing in Internet. Affiliate Marketing is a new and revolutionary method for driving profits through revenue sharing relationships between on-line merchants and content sites. Affiliate Marketing is internet marketing that allows websites to share traffic and revenue using banner and text advertisement. Merchants who sell goods and services on-line pay commissions to website owners (Affiliates) for sending traffic to their site. Merchants may pay by the sale, the lead, the click or by impressions. Affiliate Marketing pushes products and services out to the consumer on virtual shelf space across the Web, creating more opportunities for merchants to generate sales, for affiliates to earn revenue from their sites, and for consumers to find the products and services they want on the Web.
How it Works?
In Affiliate Marketing, one website (an affiliate) promotes another website's products or services (a merchant) in exchange for a commission.
Merchant provides banner, button or text based ads to Affiliate for placement on Affiliate's website.
People click on the ad and go through Merchant's website.
If ad generates a sale, lead or click through, Affiliate earns a commission.
It can be defined as, a business relationship with a merchant or other service provider who allows you to link to that business. When the visitor clicks on the link at your site and subsequently makes a purchase from the merchant, you receive a commission based on the amount of the sale, a referral fee or a pay-for-click fee.
Websites like AMAZON.COM, EBAY.COM , PAYPAL.COM are paying dividends to the referred person. If you have website you can put theses company logo or advertise in your website or you can write exclusive e-mails regarding this products.
Affiliate Marketing Terms :
Cost Per Sale or Acquisition (CPA).
Cost Per Lead (CPL).
Cost Per Click (CPC).
Cost Per 1000 Impression (CPM).
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