Affiliate Marketing DOI

Affiliate Marketing is a form of performance-based advertising where a company compensates one or more affiliates each for every customer or visitor brought about by the affiliate's marketing efforts. This form of internet marketing enables affiliate marketers to earn commission based on the value of that visitor or customer. Affiliates are rewarded for referring visitors and customers who are looking for similar products and services. For every action that leads to a sale, the affiliate is paid a commission.

In affiliate marketing, advertisers usually pay a fixed amount to affiliates on the basis of the number of impressions or views their advertisements receive. The most popular forms of affiliate marketing include Pay Per Click (PPC), Pay Per Sale (PPS) and Pay Per Lead (PLO). Affiliates can also be rewarded for referrals of affiliate sites, such as merchants' own websites. A typical affiliate program includes Cost Per Action (CPA), Cost Per Milestone (CPM), or Cost Per Action and Cost Per Mile (CPM and PLO). Other types of affiliate programs are referred to as revenue share, performance affiliate network, and revenue multiple.

Cost Per Action (CPA) affiliate marketing displays relevant ads on a web page with the click of a user's mouse. Each time a visitor clicks on an ad, the advertiser pays the affiliate. Affiliates can choose to display one of many different CPA offers, including cost per click (CPC), cost per mile (CPM), or cost per action (CFA). To qualify for acceptance into a CPA network, affiliate marketing programs need to demonstrate a steady flow of traffic and a high level of conversion.

Pay Per Lead (PPL) affiliate marketing is an internet advertising method that provides advertisers with a way to track the progress of their advertisements. Through a PPL account, advertisers can obtain detailed information about which campaigns are paying visitors well and which are not. Advertisers can also get a snapshot of which keywords are generating the most traffic, which demographic groups are responding well to particular ads, and which keywords they are paying the least amount for. PPL programs include pay per click (PPC), pay per impression (PPI), and pay per play (PPI/PPP). PPC is considered the most effective of the three methods and provides advertisers with a captive audience; however, PPI costs more than PPC and CTR, and there is currently no strategy in place to mitigate the cost of PPC.

Cost Per Milestone (CPM) is similar to PPL, but it tracks only the amount of money an affiliate receives from an ad. The program is ideal for affiliates who have difficulty determining the amount of traffic their ad will generate. CPM is not associated with keywords or adware, and the program does not require affiliates to pay for display space. CPM does not have a minimum dollar amount, and it does not require an up-front fee from affiliates. However, many affiliate marketing programs ban affiliates from using CPM, stating that the money gained through CPM is used to fund illegal activity.

Referral Marketing is often considered the best form of affiliate marketing, because it is free. Unlike other affiliate marketing programs, referrals do not have to be paid to use this method. However, advertisers must provide incentives for affiliates to refer their site visitors. Advertisers may require affiliate marketing affiliates to post a link to a paid content or service (e.g., an eBook, video series, or service), or may require that the affiliate promote a coupon or discount to their site visitors.

Merchants can also use affiliate marketing to drive website traffic to their sites. Advertisers are able to target certain websites and generate revenue based upon the number of clicks that occur when a visitor goes to that specific website. Merchants and website owners can share advertising revenue or responsibility. Through merchant-sponsored links, affiliate marketing allows merchants to boost their online businesses and attract new visitors and customers to their sites. For example, if a merchant promotes its website on its affiliate's blog, affiliates who place the affiliate ads on their blogs may receive a commission.

Web sites such as Facebook and Twitter have become popular places to advertise affiliate products and services. These websites are popular among advertisers because they are relatively low cost, and many people use them every day. Many businesses have found that through affiliate marketing, they were able to increase their web site traffic and sales, and retain new clients. Affiliates play an important role in the success of web 2.0 websites.

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