In an affiliate program, an online business or merchant pays an affiliate or associate a commission after it has successfully brought a visitor or customer to its website or e-commerce site. Typically, merchants offer this type of marketing program with the main object of increasing its sales revenue. The affiliate acts as a third party marketing agent whose main role is to connect buyers to sellers. This means that for affiliate marketing to work, three parties are necessary to be involved, and they are the merchant, affiliate, and customer.

With the goal of increasing the customer base and market share, many companies today are positioning their brands online and one of the most effective strategies in doing this is through affiliate marketing. They tend to choose this type of marketing primarily because of the lower cost of investment, typically ranging from $1,000 to $5,000 per year (this is the amount a company needs to join an affiliate network partnership program).

The easiest way to know if a company or business owner is engaged in an affiliate program is through its website. Those ad banners placed on different sections of the website or web pages are an indication that the site owner is running an affiliate marketing campaign. To gain a better understanding on how the parties involved benefit from this program, one must understand the aspects of affiliate program administration and affiliate linking methods.

Affiliate Program Administration

For an affiliate to earn success on the program, they needs to invest time, money and energy. One effective approach is by designing marketing strategies that would convince visitors to do something on the site that is worth converting into sales. This is known as “conversion marketing,” the process of converting qualified leads to buyers or customers. There are three ways on how to determine if a conversion has occurred in an affiliate’s website and they are:

* When a visitor clicks the merchant website’s link (ex. ads banner, text or image links)

* When a visitor buys something or avails a product or service (on this case the visitor is considered a customer)

* When visitor sees the merchant website’s banner or link (referred to as an “impression”)

Any activity that satisfies any of the above conversion marketing criteria is considered as a “hit”, and that has an equivalent amount which the merchant (through the affiliate network) has to pay to its affiliate.

Affiliate Linking Methods

Other than advertisement banners, affiliate program uses other methods in linking the affiliate’s website to the merchant’s product page or landing pages. With the emergence of various internet marketing techniques such as Search Engine Optimization (SEO), Inbound Marketing, Email Marketing, and Paid Search Engine Marketing, the following linking methods become widely used in affiliate marketing.

* Text Links
* Banner Links
* Search Box
* Vendor Storefront
* Product-specific Link

“Hit” Tracking Methods

Anyone who wants to become an affiliate should at least have the basic understanding on how “click,” “purchase” and “impression” (or “hit”) are being tracked. The following methods of tracking affiliate conversions are mostly used in affiliate programs today:

* Cookie Tracking
* Simple Direct URL Links
* URL Query String Tracking
* Self Replicated Pages
* Sub Domain Tracking
* Database Record Match Tracking

How to Become an Affiliate

To become an affiliate, you will be requested by the affiliate marketing network to fill out online forms and submit your site for evaluation. Affiliate network, sometimes called “affiliate brokers” take the following broader roles:

* Processing applications of affiliate applicants which include information verification, site evaluation, and arrangement of payment methods

* Setting up an affiliate program for the joining merchant which includes creation and distribution of banners and links to the affiliate’s websites, and recruiting affiliates

These days, you can find lots of companies offering affiliate programs. If you own a website, register for an affiliate program and once approved, setting up the banners and links would be easy. Simply copy the affiliate’s HTML code provided to you by the affiliate network and paste it into your site’s HTML code box. You have the options to add that banner or link on your website’s sidebars, header, footer or within the text of a post.

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