Increasing Online sales Through Affiliate Marketing

Affiliate Marketing

One of the most tried, trusted, and beneficial ways of increasing online sales through marketing and advertising is affiliate marketing. This is basically a revenue share sort of system, where an affiliate is given a form of commission from a merchant, based on how many sales the affiliate has generated through advertising on his/her site. Affiliate marketing began just four years after the world-wide web was launched, and many successful e-commerce sites owe much to this simple yet effective method.

There are three types of affiliate marketing methods of payment either pay-per-click (generated by actual clicks or referrals to the merchant from the affiliate’s site), pay-per-action or pay-per-sale (very similar, in that the affiliate receives payment, either a fixed amount or commission, based on the sales or subscriptions that have come through referrals or adverts on the affiliate’s site.) The last two methods of payment are generally preferred by merchants, due to many fraudsters taking advantage of the click system and setting up sites with forced clicks, pop-ups, adware, spam, false advertising and many other black hat techniques.

Affiliate marketing is not limited to only display-adverts on an affiliate site, but also comes in the form of email, blogs, rss feeds, content and niche sites, loyalty sites, comparison sites or shopping directories, and other forms. It is an extremely low cost, but highly effective form of marketing and advertising, presenting little to no risk for both the merchant and the affiliate.

Affiliate Marketing- the Stepchild of Online Marketing

The real step-child of online marketing is affiliate marketing, a tried and trusted method for creating sales and advertising websites or products online. Many e-commerce sites owe a great deal to affiliate marketing methods; namely Amazon.com and CDNOW’s WebBuy system. Affiliate marketing is a highly efficient way to create brand awareness and generate leads and business.

Affiliate marketing encourages ‘affiliates’ to sell or advertise a merchant’s products by means of a revenue share or commission system. In the early days of the web when affiliate marketing started (about late 1994) most merchants made use of a Cost-Per-Click system (known as CPC or CPM) where an affiliate made money from every click to the merchant’s website generated from the affiliate’s site. Because of bad management and many fraudsters taking advantage of this system in various ways, only about 1% of affiliate marketing is now done this way. 80% of affiliate marketing is now on a cost-per-sale basis, where the affiliate receives commission for every actual SALE generated on the merchant’s site that is due to a referral from the affiliate and the last 19% of affiliate marketing is on a cost-per-action basis, where the affiliate receives a revenue-share if the person referred from their site actually subscribes or registers with the merchant’s website.

Affiliate marketing is done through different types of techniques or publisher websites - blogs and RSS feeds becoming quite a predominant method, as well as shopping and comparison websites, loyalty websites and others.

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