Affiliate Marketing - All The Basics You Need To Know

by Anson Hall

There are various types of online advertising and one of the most of popular types is undoubtedly affiliate marketing. More and more advertisers are now adopting this mode of advertising. Yet do you know exactly how does it work?

It is not difficult to understand the notion behind affiliate marketing. A company, say Ebay, may place a banner or text link on a website. If someone clicks the links or banners to visit Ebay, Ebay will in turn pay some commissions to the website. This is just an easy concept right?

At this point we may talk about the history of affiliate marketing. The music website was the first website which used this method to advertise. And this can be traced back to the year 1994. After the pilot experiment of this music site, other sites such as Amazon started to launch various affiliate programs. More and more companies, from small companies to very big ones, have developed their own affiliate programs and most of them are running very well. Some people believed that it is the most famous mode of advertising online today.

But why so many companies adopt this type of advertising? Do they have other choices? Of course companies always have various choices on internet marketing. However, affiliate marketing is still the most popular one. It is mainly because this method of advertising is a performance based advertising and the advertiser will only pay if the hosting website, or the publisher performs well. And advertisers do not need to spend a buck if the publisher cannot perform as well as it should be performing.

The advertisers will usually count the number of visitors by counting the unique IPs. It will probably count the number of unique IPs within a 24-hour period. On the contrary, there are also advertisers which count the number of impressions of the banners or text links. However, most advertisers will prefer the former since the number of impressions cannot guarantee the number of visits to the company websites. And no one in the world would like to spend on advertising which has little or no effect.

You may have a feeling that the mode of affiliate marketing described above is not the one you have encountered. Yes this is true. In fact the most famous mode of affiliate marketing is a bit different from the above. Only referring visitors is not enough, what the advertiser wants are sales. As a result, advertisers will only pay if visitors referred purchase products or services. This of course will make the publisher harder to earn the commissions but the fact is that most affiliate programs will be running under this mode.

Affiliate marketing becomes extremely popular in recent years since both the advertisers and publishers can earn and make money from it. And it is expected that it will still be the most popular way of online advertising in the future.

About the Author:

Anson Hall is an author. He shares Beginners Affiliate Marketing Tips from his website. Be sure to check his Free Web Statistic Analyser.