For online retailers, affiliate marketing technique is one of the most popular advertising tool. It is a performance-based marketing. A business rewards the affiliates when they brought visitor or customer with their effort. In the affiliate marketing, there are four core participants, the merchant, the network, the publisher and the customer. The merchant is also known as brand or retailer, the network takes care of the payments and contains offers that can choose by affiliates, the publisher is also called as affiliate.

  • Types of affiliates: There is no exact definition and common industry standards for the affiliate’s website. There are some generally considered affiliate website types or categories by the affiliate marketers. Those are search engine affiliates which promote the advertiser’s offers by utilizing pay per click, directories, comparison shopping websites, discount or coupon websites, niche products or services sites, personal blogs and websites, Loyalty websites with reward system for purchasing via cash back and points back, cause related marketing websites with charitable donations, website syndication feeds and web-logs, email and newsletters, video blogs & websites, file sharing websites which hosts directories of software, games, movies music and other digital media, virtual currency websites which offers with a handout of virtual currency in a virtual platform or game by utilizing social media, etc.
  • Compensation methods: The compensation or the commission is depends on the agreement. Each time when a visitor completes an online purchase, or registers for more information or clicks on the ad, the affiliate will get commission. The commission is vary based on the transaction’s nature. If the transaction is completed surveys or page views resulted in sales, the affiliate will get a higher commission. The commissions are generally paid as either flat fixed price or as a percentage of the sale.
  • Benefits: The benefits with the affiliate marketing are:
    • Website owners can earn some extra income with the affiliate marketing. There is no need of extra effort by them for this, because the websites maintaining by them are already up and running. By building a good online reputation and increasing websites traffic, affiliates can earn more and find new partnership opportunities.
    • Retailers to take the advantage of huge potential visitors that offers by affiliate marketing. Retailers can give it for outsourcing when they do not have sufficient time to invest for online promotions or not a web savvy.

Affiliate marketing may sound easy but it is not a guaranteed success for the affiliates or retailers. Over the past few years affiliate marketing become more popular, with this the ads are over saturated in the websites. Retailer and affiliate relationships are looking to be relevant partnerships when the visitors trust both the product and the website.