The term affiliate marketing refers to the concept whereby a merchant/dealer who is the advertiser appoints one or several advertiser/s who generate traffic or leads to the merchant's website, in order to generate larger sales. These advertisers who are typically known as affiliates are paid on the basis of either performance measure or registrations or direct sales generated by them, as may be the decided terms.
The affiliate marketer promotes the products/ services of the client merchant through various websites, blogs, posts, articles etc. directing the traffic to the merchant's website who then pays commission or remuneration to such marketer. There could be thousands of affiliate marketers for one website whose motive is to generate visitors to the website who are potential to originate sales for the website
Such a marketer makes use of analytical tools to keep track of the types of links and posts that generate actual sales.
How Affiliate Marketing Works
A merchant that wants to reach a wider base of internet users and shoppers may hire an affiliate, who could be the owner of multiple websites or email marketing lists with a wide network. He then communicates and promotes the products offered on the e-commerce platform to his network. He implements banner ads text ads and/or links on their multiple owned websites or via email to his clientele. Advertisement could be in the form of articles, videos, images, etc., which are used to draw an audience's attention to a service or product.
A visitor who clicks on one of these links or ads on the affiliate's site will be redirected to the e-commerce site. If s/he ends up purchasing the product or service, then the e-commerce merchant credits his account with the agreed commission, which could be 5% to 10% of the sale price of the product
Marketers become affiliates in a number of ways that include:
1) By enrolling in retail or e-commerce sites. Shopify, for example, has a program that lets marketers earn commissions on new buyers.
Surveying existing customers to learn their favorite products or services and then contacting those companies to inquire about such programs. For example, a small business marketing consultant might become an affiliate of an email list distribution service. The marketer receives a unique URL. They share that unique URL on social media ads, posts. When the potential buyer clicks on these URL, they get paid by the merchant.
2) Searching online for products that are relevant to the marketer's site and will appeal to the target audience. Most companies that offer such programs indicate that with as related link or “Partners” link at the bottom of their site home page.
3) Looking for potential affiliate products at program managers that include Commission Junction, ClickBank, and ShareASale.
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