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 How affiliate Programs Work!

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Number of posts : 23
Registration date : 2008-01-03

PostSubject: How affiliate Programs Work!   Mon Jan 07, 2008 12:39 pm

These days, it's remarkably easy to set up your own Web site. If you have a computer connected to the Internet, you can simply go to a site such as GeoCities or AOL and use their ready-made Web design templates to construct a simple personal page. These sites will give you a URL, store the content of your page and slap on some advertisements. Just like that, in an hour or two, your page is on the Web!
But what if you want to take your site to the next level? If you have a content-driven Web site, how can you make money off your traffic? If you are an online merchant, how can you get people to your site to buy your products? One popular option that serves both of these functions is an affiliate program. In this edition of, we'll examine affiliate programs to find out what they are, how they work, who they are for and how you can use them to benefit your Web site.
What Are Affiliate Programs?
Simply put, affiliate programs, also called associate programs, are arrangements in which an online merchant Web site pays affiliate Web sites a commission to send them traffic. These affiliate Web sites post links to the merchant site and are paid according to a particular agreement. This agreement is usually based on the number of people the affiliate sends to the merchant's site, or the number of people they send who buy something or perform some other action. Some arrangements pay according to the number of people who visit the page containing their merchant site's banner advertisement. Basically, if a link on an affiliate site brings the merchant site traffic or money, the merchant site pays the affiliate site according to their agreement. Recruiting affiliates is an excellent way to sell products online, but it can also be a cheap and effective marketing strategy; it's a good way to get the word out about your site.

There are at least three parties in an affiliate program transaction:
• The customer
• The affiliate site
• The merchant site
In 1996, Jeff Bezos, CEO and founder of, popularized this idea as an Internet marketing strategy. attracts affiliates to post links to individual books for sale on, or for in general, by promising them a percentage of the profits if someone clicks on the link and then purchases books or other items. The affiliate helps make the sale, but does everything else: They take the order, collect the money and ship the book to the customer. With over 500,000 affiliate Web sites now participating,'s program is a resounding success.
Over the past few years, affiliate programs have grown enormously in popularity, taking many interesting forms. For many Web sites that don't deal much in e-commerce (selling products or services online) themselves, functioning as an affiliate is a good way to participate in e-commerce.


There are three basic types of affiliate program payment arrangements:
• Pay-per-sale (also called cost-per-sale):'s affiliate program is an example of a pay-per-sale arrangement. In this arrangement, the merchant site pays an affiliate when the affiliate sends them a customer who purchases something. Some merchant Web sites, like, pay the affiliate a percentage of the sale and others pay a fixed amount per sale.
• Pay-per-click (cost-per-click): In these programs, the merchant site pays the affiliate based on the number of visitors who click on the link to come to the merchant's site. They don't have to buy anything, and it doesn't matter to the affiliate what a visitor does once he gets to the merchant's site.
• Pay-per-lead (cost-per-lead): Companies with these programs pay their affiliates based on the number of visitors they refer who sign up as leads. This simply means the visitor fills out some requested information at the merchant site, which the merchant site may use as a sales lead or sell to another company as a sales lead.
There are a number of other arrangements as well. Basically, a company could set up an affiliate program based on any action that would benefit them, and then pay their affiliates based on the number of customers the affiliates send them who perform that action.
There are a couple of very popular variations on these basic payment plans:
• Two-tier programs:These affiliate programs have a structure similar to multilevel marketing organizations (also known as "network marketing") such as Amway or Avon, which profit through commission sales and sales recruitment. In addition to receiving commissions based on sales, clicks or leads stemming from their own site, affiliates in these programs also receive a commission based on the activity of affiliate sites they refer to the merchant site.
• Residual Programs: Affiliates in these programs can keep making money off a visitor they send to the site if the visitor continues to purchase goods or services from the merchant site. Many online merchants who receive regular payments from their customers (such as monthly service fees) run this sort of affiliate program.
Additionally, there are a few pay-per-impression affiliate programs. Companies running these programs, also called pay-per-view programs, pay affiliates based only on the number of visitors who see their banner ad. Usually, this sort of arrangement is not structured as an affiliate program, but simply as a traditional advertising program. The advantage affiliate programs have over traditional advertising is that in an affiliate program, an online merchant only pays its affiliates when it gets a desired result. Traditional advertising, such as the ads you see on TV and a lot of the banner ads on the Internet, is relatively risky for the advertiser. They spend money on advertising based on a guess of its effectiveness. When an ad brings the company more money than it spent on that ad, the ad is a success. If the company makes less money than it spent, it has to swallow that loss. With an affiliate program, an online merchant only pays its affiliates when things are working. Because there's much less risk to the merchant, it's a lot easier for Web sites to join affiliate programs than it is for them to attract advertisers

Pay Per Click Advertising And Article Marketing Compared

At first glance, Pay Per Click advertising seems to be the fastest way to send targeted website traffic to your websites online. You choose some keywords and add your website’s url and you are done. However, with most things online the competitive search terms are often very expensive and you spend lots of money to win the Pay Per Click wars. This article will list five reasons why article marketing may be better than Pay Per Click Advertising.

Permanent links

Anyone knows that once you stop paying for your pay per click results, you will stop getting website traffic. Articles on the other hand always stay on the pages of a high traffic website if added. This is like opening a shop in a busy shopping mall. You get more targeted website visitors this way quite easily. Once readers read the targeted articles and then click through to your website, they are in the mood to read whatever offers that you can sell and you tend to make more money this way as they treat you as an expert if they like your article. Thus in article marketing, you get traffic on a continuing basis and not just when you pay for it.

Viral effect

Not only that if publishers like your work, they put it on all their websites and send it to their newsletters with many readers and some of these readers will start clicking to your website and signing up or purchasing whatever you are promoting. Some readers if they like your article will forwarding the email to their friends and make you even more money. Some other publishers will start adding your article to their blogs and generate even more website traffic for your website that you are marketing. The more targeted website traffic the more money you will start making.

Page Rank

The basis of Search Engine Optimization (“SEO”) today is based on PageRank and website traffic. Granted that you know how you get added website traffic with article marketing, we now turn to SEO. The major search engines today looks at the number of inbound links from targeted website pointing to your website. This means that if you have a cooking website, the more links to your website from cooking websites the better. Article marketing works in the same way as if your business is on health for instance and you write health articles, your publishers are going to be health websites and your PageRank due to the number of inbound links pointing at your website will increase. Your search engine rankings will also start climbing and you will start getting more targeted website traffic and make more money.


Writing your own articles and publishing them can be free as compared to paying for Pay Per Click Advertising and the more articles you write the more well known you will be and the more targeted website traffic you will get. Why spend hundreds each month on Pay Per Click advertising when you can start getting website traffic for almost free by writing articles on topics relevant to your particular internet business. But that said, time is what you will be spending so if you want the easy way out, get someone to ghost write an article for you. You can get it for $5 per article or less at websites like or

In conclusion, this article highlights four reasons why Article Marketing is a good way to consider especially if you are on a tight budget and its ability to send your website continuous targeted website traffic is something that you should consider carefully if you want to use this method of online promotion.
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