Affiliate marketing is a term that has been growing recently within the web, and it is due to its great boom in online commerce, but we must know that this discipline is not new, since it is part of classic online marketing, only that 20 years later it has become a powerful tool.
To begin we must know that, in a simple way, affiliate marketing is a model based on sales and billing that follows the principle of commission through mediation, it has two main components that are:
"Affiliate marketing is a model based on sales and billing that follows the principle of commission through mediation"
- Merchant: also known as an advertiser, is responsible for marketing their products or services on other people’s websites, through advertising spaces within these same pages such as banners, offering a commission for each sale.
- Affiliate: also known as a page manager, it is one that makes the advertising space available to the merchant within its website using its scope to guarantee potential customers.
To guarantee this method, there are affiliate networks or affiliate providers that act as intermediaries between merchants and affiliates, they are software that ensures that the process occurs and thus commission billing can be obtained.
Now, there are several payment models to obtain the remuneration, which are the following:
- Payment per sale: or pay per order (cost per sale), is one of the most used methods since payment is made only when a customer clicks on the link or banner of the merchant on the Affiliate website, whether or not the affiliate completes the purchase, the affiliate will receive a commission.
- Pay per click: is when the remuneration is obtained when the client clicks on the link or banner, it was one of the most used methods in the past but, it has been shown that its return on investment is low.
- Pay per click out: it is similar to the previous model but, unlike pay per click, this model requires the customer to make a second click within the merchant’s website.
- Pay per lead: in this case the remuneration occurs when the client contacts the advertiser, for example, by filling out a form.
- Registration payment: pay per sign up, is part of the above and only occurs when the customer registers on the merchant’s website.
- Pay per installation: is part of the pay per sale model and remuneration only occurs when the client installs a software.
- Pay per link: remuneration occurs when a merchant’s product is linked on the website, it is often used by bloggers.
- Lifetime remuneration: normally this model is used when the merchant offers subscriptions and the affiliate receives the remuneration during the time that the customer is subscribed to the merchant’s service.
Image from Sugarrae.com.