Affiliate marketing is the term used to describe a revenue-sharing plan where an online automated marketing program lets Webmasters place an advertiser's banner ads or buttons on their own Web site. Webmasters will receive a referral fee or commission from conversions when a customer has clicked the affiliate link and performs the desired action, such as make a purchase or opt-in for downloads or newsletters on the advertiser's site. Advertisers invest in affiliate programs for lead generation, and, of course, sales.
Not all affiliate plans work in the same way or pay the same rates. Some enable you to place text or image hyperlinks to products or a Web site, others allow you to set up a shopping or store page that offers products related to the content of your Web site, and others require you to simply place general advertising banners or buttons.
Affiliate marketing is internet advertising that allows any online business to affiliate themselves with web site owners (known as affiliates or publishers) using affiliate programs. Affiliates make money by generating sales, leads and traffic for the Merchants business. Merchants who sell goods and services online or seek other affiliate business activity typically use one of the affiliate program commission payment models below:
Cost Per Sale (CPA):
A visitor referred by the Affiliate purchases goods and services from the Merchant. This payment structure is referred to as - cost per sale or cost per acquisition (CPA).
Cost Per Lead (CPL):
A visitor referred by the Affiliate completes a form on the Merchants web site. This payment structure is referred to as - cost per lead (CPL).
Cost Per Click (CPC):
A visitor to the Affiliates web site clicks on a Merchant's banner and visits the Merchant's web site. This payment structure is referred to as - cost per click (CPC).