The basics of Affiliate Marketing
In the changing landscape of selling and buying in the 21st century, Marketing has evolved a lot and has got some new & different branches. Digital Marketing is one example. Among its subcategories, Affiliate Marketing is the one that is becoming quite popular.
Affiliate Marketing can be called as a type of Pay-Per-Click (PPC) marketing. It is the process by which an affiliate does marketing for another person’s product/service and earns a commission if someone buys the product/service through his marketing.
Affiliate marketing involves three parties:
- The Merchant. The one who creates the product/service and sells.
- The Affiliate. The one who does advertising for the merchant.
- The Customer. The one who will purchase the merchant’s product/service from the Affiliate.
Often a 4th party is involved, known as the affiliate network. They are the mediators between the Seller and the Affiliate. They keep a list of all the merchants and their business and the marketing rates. It becomes useful for the affiliate to choose their preferred merchant’s business to advertise. Both, the merchant and the affiliate can be either a single person or an entire company.
Affiliate marketing is beneficial for both, the Seller and the Publisher (the affiliate). It achieves to leverage the skills of many individuals for a compelling marketing strategy and the profit is shared among all the contributors.
The benefit for the product/service creator or the merchants is that they don’t need to actively participate in the marketing process. In a way, they are outsourcing their marketing tasks to someone else saving their own time for some other productive works.
The merchant can pay the affiliate in three ways:
Pay per sale: in this, the affiliate is compensated when a customer buys a product/service via the links given to the affiliate by the merchant and his marketing efforts.
Pay per lead: here the affiliate has to influence the people to visit the site of the merchant and do some prefixed actions like signing up, subscribing to a newsletter, filling a form etc.
Pay per click: The aim here is to increase the web traffic of the merchant’s website. The more the people the affiliate manages to redirect to the merchant’s site, more will be his commission.
For the merchant, it becomes important to choose a suitable affiliate to market their business if they want to go ahead of their rivals in the competition. Someone who has prior experience marketing in the product/service niche of the merchant’s offerings, someone with a good following, and someone passionate about their work should be preferred.
Affiliate Marketing has indeed turned out to be such a cost-effective and a win-win situation for everyone involved in it. Surely it is here to stay for a long time to come.