What is Affiliate Marketing?

What is Affiliate Marketing?

Affiliate marketing is a marketing model which is based on performance, where a business will reward an external partners or affiliate with a commission for referring them with sales, traffic or leads.

Affiliate marketing is the digital equivalent of earning a finder's fee for recommending a product or service, with the process relies entirely on specialised tracking parameters to attribute the customer's action back to the correct promoter.

1. The Merchant or Business

A business or the merchant wants to sell its products or services and decides to recruit affiliates to help promote what it is offering.

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2. The Affiliate

The affiliate promotes the products and services of the merchant through their website, blog, social media and other marketing channels, using unique links to track and referrals to the merchant.

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3. The Customer

A potential customer clicks on the affiliate link and is redirected to the website of the merchant, where the customer will complete a desired action or simply browse and make a purchase.

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4. Tracking the Sale

The affiliate tracking system being used by the merchant will track the sale, linking it to the correct affiliate using the unique tracking link or cookies.

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5. Commission

Once the sale has been confirmed and any return or cooling off periods have passed, the affiliate is paid a commission based on the agreed rate.

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Technical Details

The affiliate tracking process relies entirely on specialised tracking parameters to attribute the customer's action back to the correct advertiser or affiliate.

  • The Tracking Link: When an affiliate joins a company's program, they receive a unique affiliate link.
  • The Tracking Cookie: When a customer clicks on the affiliate link, a small file called a cookie is saved to their browser, which typically has an expiry date to be deleted anywhere from 24 hours to 30 days.
  • The Commission: If the customer makes a purchase before the cookie expires, the affiliate gets credited with a percentage or a flat fee of the sale.

Affiliate Networks

Larger companies such as Amazon will operate and directly manage their own affiliate programmes but for businesses and merchants who don't have their own capabilities to track referrals to their website, they will use an affiliate network.

An affiliate network will not only provide the technical requirements to track and manage referrals and commissions, they will also match affiliates with merchants, acting as a 'Middle Man', between merchants and affiliates.

In Summary

A popular tool for individuals, content creators and businesses to earn money online, affiliate marketing allows people to earn a commission by advertising and referring the products and services of another business.

Further Information, Websites & Links

The following websites and links provide further information and resources if you would like to learn more.

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