Affiliate
Marketing-Simple, Yet Effective
Affiliate Marketing has increasingly become an integrated and large
part of a company’s marketing plans – most notably
for companies that wish to use the internet to gain revenue or sell
products. For this reason, e-commerce owes much of its rise to the idea
of affiliated marketing, which includes websites such as CDNOW (BuyWeb)
or Amazon.com.
The idea of affiliated marketing is profoundly simple yet incredibly
effective. Basically, a webmaster will display a merchant’s
adverts on a site, and be paid for those websites in one of three ways.
Either, he will be paid per click (known as Cost-per-click, CPC for
short) which means that every time the advert is clicked, the affiliate
is paid. This is not the favored form of affiliate marketing due to
many fraud click sites, the rise of adware, and other fraudulent
schemes. 3
Another method of payment is Cost-per-Action (CPA) which is when the
affiliate receives income based on either a sale, registration, or the
‘action’ of the person who has clicked the advert
from the affiliate’s site.
The last form – and most favored form – is the
Cost-per-sale method (CPS) which is based solely upon sales or
purchases generated on the merchant’s site, that have come
through the affiliated site. CPA and CPS are very similar in this
respect, and represent a form of revenue sharing or commission plan. 3
Affiliate marketing has many benefits for both the affiliate and the
merchant, one being that there are no real risks at all for both
parties – and both parties find it very beneficial. Merchants
enjoy affiliate marketing, and it has become a favored form of
advertising for e-commerce business.
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