In the modern digital marketplace the place and role of Affiliate Marketing is growing day by day. This article has been created to provide a basic knowledge and outline of the industry as it exists, the role of content and technology in the present market.
The global digital marketing and advertising ecosystem is growing and affiliate marketing is an important key part of the value chain.
Affiliate Marketing connects a business that has a product to sell with a marketer who can sell it.
Affiliate Marketing is a promotional model that connects merchants with independent marketers who are willing to invest time and money to sell a merchant’s products.
Affiliate marketing is the sale and exchange of revenue between advertisers, merchants, and online publishers.
This is a way to promote the web-based business by bringing buyers and sellers together and rewarding intermediaries who have pointed out the connection.
Best part is that almost anyone can start with it and its configuration is almost FREE !
You can start earning without any product manufactured by your own !
Affiliate marketing started in 1996 with Amazon.com when it launched its affiliate program. Today, the company is available in 17 countries.
The basic idea is that small website owners register with Amazon. The owner of the website displays links, banners and product descriptions on his website.
When visitors to your website click on a book and buy it, the site owner receives a commission for the easily generated sale.
After the success of Amazon, other companies followed the same approach.
What Is Affiliate Marketing?
Let’s start at the beginning with a simple definition :
Affiliate Marketing is the practice whereby a digital publisher or website promotes an online retailer and earns a commission based on the sales or leads that the advertising generates for that online retailer.
What Is CPA?
C.P.A. : this payment metric is termed as Cost Per Action in short CPA.
What is the meaning of the term “Action” ?
Action: Typically an ‘Action’ is a sale of an online good or service, but it can also be a lead or registration, a call, a download or any other trackable action that is desired of the end customer. Nowadays this has grown to even include an offline sale, provide they can be tracked back by a coupon or barcode.
How C.P.A is Set ?
Flat Rate: A fixed amount is paid for every action. This is typically used for registration type of action with no cost.
Revenue Share: A percentage of the selling price of the product is paid to affiliate. This is generally favoured by advertisers.
It’s a versatile channel and is very effective at driving actions for merchants selling consumer products or services across a wide range of verticals, including apparel, travel, electronics, health and beauty, telecommunications, finance and groceries.
Generally the terms ‘Affiliate’ or ‘Publisher’ to define the website that is promoting the brand or products.
What Is Misconception?
let’s just dispel a common misconception: Affiliate Marketing isn’t just banner advertising, in fact, most campaigns will get less than 10% of their sales as a result of banner advertising.
With time consumers have learned to ignore these banners, so successful affiliates employ smarter, more engaging tactics to generate sales for the advertisers they work with.
With most sales coming from ‘text links’ often hidden behind ‘Buy Now’ or ‘Shop Here’ type buttons. A ‘text Link’ in the affiliate world is just a trackable URL that redirects to the relevant page of the advertiser’s website.
How To Generate Actions ?
This can be achieved by:
- Promoting on their own website or blog.
- E-mail marketing,
- Mobile apps,
- Paid search,
- Remarketing widgets or campaigns,
- Offline promotions and social campaigns.
The scope is almost unlimited. Any publisher or partner paid to promote on a CPA metric could be considered an affiliate.
How Does Affiliate Marketing Work Technically?
- Most advertisers will employ an Affiliate Network to administer the tracking of their Affiliate Campaign.
- The network will provide a set of Tracking Links to the affiliates that sit behind the banners and text links on the affiliates’ websites.
- When the customer Clicks on that link a Cookie is dropped onto their computer and that Click is Registered by the Affiliate Network.
- When that customer Completes a Purchase and reaches the advertiser’s confirmation page, the Affiliate Network’s Tracking Tag is fired.
- That tag checks for the relevant cookie and if the customer has come from one of the Affiliate Network’s publishers, the Sale is Recorded by the Affiliate Network in their platform.
- Via that platform both the advertiser and affiliate should be able to see that the sale has tracked and a Commission can be Awarded.
The tracking tag is always with all of the information relevant to the sale, typically the Price and Order ID are always included, then additional fields such as the Product Stock Keeping Unit (PSKU) or Promotion Code can be added and tracked to assist with analysis of the campaign’s performance.
What is Basic Tracking Model ?
Basic Tracking Model:
There is a wide range of complications and options to improve on the basic tracking model.
The advanced networks are able to provide cookie-less tracking, so that sales can still be attributed to affiliates when the user has blocked or deleted the affiliate cookie.
This is important and becoming more popular as some browsers automatically block third-party cookies.
What Are The Types Of Affiliate?
When we talk about Affiliate Marketing, it is very important to note that there are different types of affiliates. The method chosen by the affiliate to promote the advertisers’ products is the key differentiation.
- Reward sites: With online marketing becoming increasingly popular, reward sites have seen a surge in popularity. This type of affiliate drives sales by rewarding its members through a share of the commission it earns from an advertiser.
- Content sites and blogs: These types of websites are often focused on a niche interest and feature unique content. A few examples are product review sites, blogs and online forums. The unique content suggests editorial credibility and often has a positive impact on an advertiser’s search engine optimization (SEO) efforts. Content sites can also help reach a new audience. A great way to engage and optimize activity with content sites is by providing fresh content or an exclusive offer. Recently it is also seen an increase in integrated content pieces as well as affiliates who are using video to monetize a product.
- Email: An Email Affiliate sends targeted emails to its own or third party data base to drive conversions on behalf of a brand.
- Comparison Websites: As the name suggests these sites offer consumers the opportunity to compare products of different advertisers like credit cards or phone plans.
- Retargeting Affiliates: Affiliates retarget most commonly through tags that they place on the advertiser’s site and try to re-engage with consumers who have not completed their purchase.
- PPC (Pay-Per-Click) Affiliate: A PPC (pay-per-click) Affiliate is a search specialist who drives traffic to an advertiser’s site by bidding on relevant keywords via a custom-built landing page.
- Voucher And Deal Sites: These type of sites generate sales by offering their users a discount code that can be redeemed online against their purchase. They also often promote generic deals in a designated section. An exclusive code will usually increase exposure on the site, where a quick expiry date will create a sense of urgency for consumers and can be used as a strategic tool to drive quick sales.
- Social Affiliates:This type of affiliate works via highly targeted posts on social networks or sponsored tweets, etc.
Thanks For Reading !
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