Affiliate Revenue Information

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Understanding Affiliate Programs



AliExpress by Alibaba.com


Affiliate programs are commonly misunderstood, in order to understand affiliate programs lets start with terminology. For clarification purposes, an affiliate is defined as any "referrer" or website that promotes a product in an effort to earn revenue. A merchant is defined as someone who owns a product and is sharing revenues with an affiliate based on the affiliate's performance. Affiliate programs can drive targeted traffic to your website.

There are 3 basic affiliate programs, though only the first two are commonly used.

Pay Per Click - this is when an affiliate is compensated for sending traffic to the merchant. (AdSense is an example of PPC affiliate program)

Pay Per Sale - this is when the affiliate is compensated by the merchant if the referral generates a sale or purchase.

Pay Per Lead - this is when the merchant agrees to pay for a qualified (or sometimes unqualified lead), which is very uncommon because it is subjective and up to the merchant.

Affiliate websites tend to provide information, entertainment, and content services to their customers. The online merchants sell products, goods and services online. These are programs permitting affiliates to earn money based on the visitors to your site who click through to another's website. Some pay a token amount for the click through and others provide a percentage of sales when a visitor "clicks through" to your site and buys a product or service on the other party's site. This could represent a value added service to your visitors.

Affiliate programs allow you to pay and track incentives from other websites that send web surfers, leads or paying customers to your website. Commissions based on purchases made by traffic sent from the referring website can be paid. Besides a commission, an affiliate can receive a flat fee, or other incentives for all valid transactions it refers that generate a sale or lead.

Be careful that the affiliate's web page is not cluttered with banner ads that may crowd out your link, or that be annoying to customers. Affiliate programs enable affiliates to leverage their traffic and customer base in order to profit from e-commerce while merchants benefit from increased exposure and sales.

Commonly traffic to merchant sites is measured and affiliates can clearly see conversion rates. Meaning, they track the percentage of people they are referring, and how much of it results in earned revenue. If the affiliate finds a very low conversion, they will find a better way to monetize that traffic, quite possibly with a competing merchant product.

In order to be a successful affiliate, the affiliate site needs to either have tons of traffic or target a specific audience, frequently one untapped by the merchant. It has been my experience, the closer the affiliate site content resembles the merchant products, the higher the likelihood of a good conversion rate.

Once you are committed to the idea of affiliates, the next step is to determine the kind of tracking system you are going to use. Sales can be tracked by HTML code, which is placed in a shopping cart or on the 'order confirmation'/'thank you' page, and cookies, which are created after the customers click on a banner ad. Cookie killers have been a problem for the affiliate industry. Software vendors have an advantage over other merchants in that new technologies allow software developers to better control compensation. Vendors can 'wrap' their software insuring that their affiliates are compensated for referrals, even if the customer downloads a trial version prior to purchasing. Buy now buttons in the software have affiliate ids imbedded in the download. Combined tracking systems have more success than those that rely on a single tracking technology.

In order to develop a successful affiliate network, merchants must realize that affiliates spend ad dollars on site, and product promotion. If the affiliate is not compensated fairly they will not remain in the merchants network. The bottom line is that affiliate relationships are partnerships, when both sides feel the situation is fair and equitable the relationship will be a success.

About the Author:

Sharon Housley manages marketing for NotePage, Inc. http://www.notepage.net a company specializing in alphanumeric paging, SMS and wireless messaging software solutions. Other sites by Sharon can be found at http://www.feedforall.com, http://www.softwaremarketingresource.com and http://www.small-business-software.net

sharon@notepage.net

AliExpress by Alibaba.com


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Net Gaming struggles with European regulations during Q1  AffiliateINSIDER

Net Gaming has seen its share prices take a hit for the first quarter of the year, as the group aims to navigate a tumultuous European regulatory landscape.


Why the New York Times, BuzzFeed, and more help you find the best - Vox.com
Why the New York Times, BuzzFeed, and more help you find the best  Vox.com

The past decade has seen a flurry of growth in the product review space, with the launch of publications like Wirecutter, Best Products, New York magazine's the ...


How to Build a Profitable Business Online by Selling Nothing - Entrepreneur
How to Build a Profitable Business Online by Selling Nothing  Entrepreneur

Learn three simple strategies to help you stack on more revenue without the headaches of fulfillment and customer support.


Magazines Power Shop for E-Commerce Revenue This Holiday Season - Folio: - Folio Magazine
Magazines Power Shop for E-Commerce Revenue This Holiday Season - Folio:  Folio Magazine

Last year's predictable flow of holiday gift guides and affiliate links from major media brands has become a downright tsunami of deal brokering in the weeks ...


Think The Wirecutter invented affiliate revenue? Meet the mom who's been doing it since 2010 - Nieman Journalism Lab at Harvard
Think The Wirecutter invented affiliate revenue? Meet the mom who's been doing it since 2010  Nieman Journalism Lab at Harvard

When The New York Times Co. acquired The Wirecutter for $30 million last fall, CEO Mark Thompson called its affiliate revenue–based business model — in ...


Why your ecommerce business needs to start as an affiliate site - The Next Web
Why your ecommerce business needs to start as an affiliate site  The Next Web

There is a lot of risk involved in starting an ecommerce business. For one, most would-be merchants don't know what products will sell well and what products ...


Fox Boycott Push Faces Tough Reality: Ad Revenue Isn’t Essential - Bloomberg
Fox Boycott Push Faces Tough Reality: Ad Revenue Isn’t Essential  Bloomberg

Activists seeking an advertising boycott at Fox News face a conundrum: The network's main source of revenue comes from cable subscribers, making it harder to ...


XL Media focus efforts on building footprint in North America - AffiliateINSIDER
XL Media focus efforts on building footprint in North America  AffiliateINSIDER

XL Media, a provider of digital performance marketing services, is focusing on its efforts on building a more comprehensive footprint across regulation markets, ...


Affiliate Partnership Specialist, Digital Marketing - BigCommerce - Built In Austin
Affiliate Partnership Specialist, Digital Marketing - BigCommerce  Built In Austin

BigCommerce is hiring for a Affiliate Partnership Specialist, Digital Marketing in Austin. Find more details about the job and how to apply at Built In Austin.


‘Reporting is a struggle’: To grow commerce revenue, publishers have spend time, money to manage the data - Digiday
‘Reporting is a struggle’: To grow commerce revenue, publishers have spend time, money to manage the data  Digiday

When Manish Nag joined New York Media as its first head of data in April, one of his top priorities was building a database to manage all the affiliate commerce ...


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