Affiliate marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate’s own marketing efforts. The industry has four core players: the merchant (also known as ‘retailer’ or ‘brand’), the network (that contains offers for the affiliate to choose from and also takes care of the payments), the publisher (also known as ‘the affiliate’), and the customer. The market has grown in complexity to warrant a secondary tier of players, including affiliate management agencies, super-affiliates and specialized third party vendors.
Affiliate marketing overlaps with other Internet marketing methods to some degree, because affiliates often use regular advertising methods. Those methods include organic search engine optimization (SEO), paid search engine marketing (PPC – Pay Per Click), e-mail marketing, content marketingand in some sense display advertising. On the other hand, affiliates sometimes use less orthodox techniques, such as publishing reviews of products or services offered by a partner.
Perhaps the simplest way to explain affiliate marketing is that it is a way of making money online whereby you as a publisher are rewarded for helping a business by promoting their product, service or site.
There are a number of forms of these types of promotions but in most cases they involve you as a publisher earning a commission when someone follows a link on your blog to another site where they then buy something.
Other variations on this are where you earn an amount for referring a visitor who takes some kind of action – for example when they sign up for something and give an email address, where they complete a survey, where they leave a name and address etc.
Commissions are often a percentage of a sale but can also be a fixed amount per conversion.
Conversions are generally tracked when the publisher (you) uses a link with a code only being used by you embedded into it that enables the advertiser to track where conversions come from (usually by cookies). Other times an advertiser might give a publisher a ‘coupon code’ for their readers to use that helps to track conversions.