What is Affiliate Marketing?

Affiliate Marketing is promoting other companies products on the internet for a commission. In affiliate marketing, the affiliate (you) sends traffic to a company's website, and the company pays you a commission whenever someone makes a purchase through your link. In affiliate marketing you can make money in commissions for almost anything being sold on the internet.

Affiliate marketing is also the name of the industry where a number of different types of companies and individuals are performing this form of internet marketing, including affiliate networks, affiliate management companies and in-house affiliate managers, specialized 3rd party vendors and various types of affiliates/publishers who utilize a number of different methods to advertise the products and services of their merchant/advertiser partners.

Affiliate marketing overlaps with other internet marketing methods to some degree, because affiliates are using the same methods as most of the merchants themselves do. Those methods include organic search engine optimization, paid search engine marketing, email marketing and to some degree display advertising.

For the most part Affiliate Marketing is simply selling other people's products and earning a commission for each sale. The commission you get paid depends on the product/service you're selling and who you are selling for. For many Affiliate Marketers the key is driving the right traffic to the affiliate offer page (often called "landing page"). If you are starting a new offer on a new site dedicated to that offer, you're going to need a method for getting targeted customers to your site. The most common form of driving this type of traffic to an affiliate landing page is via a pay per click (PPC) program. Google Adwords, Yahoo Search Marketing and Microsoft AdCenter of the three largest players in the pay per click space.

Affiliate marketing is a great business opportunity for those on a budget, and can be used in conjunction with many other types of strategies, such as:
* Selling your own products, especially reports and ebooks
* Monentizing ezines and newsletters
* Making back-end sales to other merchants with physical products you've sold

Types of Affiliate Programs
Affiliate programs can be categorized into two types, which are pay per click (PPC) and pay performance (PPP). Basically they both bring satisfactory results, depending on how you evaluate them.

* Pay per click (PPC)
* Pay per performance (PPP)
* Tier affiliate marketing
* Residual income affiliate marketing

Benefits of Affiliate Marketing

* Leads: Generating leads from affiliates on the Internet begins by targeting high traffic sites, and niche sites with a loyal following. A Web site with an online magazine mailing list, or considerable daily traffic, is a huge asset.

* Sales: The first months will often provide the biggest returns. Exceptions include commodity products such as books and music CDs, and repeat purchases such as airline tickets or investment products.

* Return on Advertising: Affiliate networks should increase the value of advertising space on the Internet. In reality few sites really sell any advertising because selling it is a full-time job.
The wealth of dead advertising space makes affiliate programs a long-term solution for both parties. If you can generate continual sales from a Web site, it only makes sense for the affiliate to keep you on the site.

* Affiliates as Customers: The final key is one most overlooked by many affiliate networks. The affiliate salesperson is likely your best customer.
Why do so many affiliate networks fight the natural urge of affiliates to buy through their own network? For example, if you buy a book through your Amazon.com affiliate network, it is literally against their policy and if they catch you, they can revoke your right to sell books.