[dropcap]A[/dropcap]ffiliate marketing is a commission-based referral partnership, typically between a website owner and an online retailer who wants to promote their product.
a website owner puts links or ads on their site that promotes the retaile;s product to the visitors of the site, ideally potential customers for the retailer. In exchange for the promotion, the retailer agrees to share a percentage of the profit with the website owner or affiliate, if the transaction generates a lead.Depending on the agreement, affiliates can earn commission each time a visitor clicks the ad.Commissions are usually paid as either a percentage of the sale or as flat fixed price.
An affiliate network acts as an intermediary between publishers (affiliates) and merchant affiliate programs. It allows website publishers to more easily find and participate in affiliate programs which are suitable for their website (and thus generate income from those programs), and allows websites offering affiliate programs (typically online merchants) to reach a larger audience by promoting their affiliate programs to all of the publishers participating in the affiliate network.
Traditional affiliate networks enable merchants to offer publishers a share of any revenue that is generated by the merchant from visitors to the publisher’s site, or a fee for each visitor on the publisher’s site that completes a specific action (making a purchase, registering for a newsletter, etc.). The majority of merchant programs have a revenue share model, as opposed to a fee-per-action mode.
Affiliates are generally able to join affiliate networks for free, whereas there is generally a fee for merchants to participate. Traditional affiliate networks might charge an initial setup fee and/or a recurring membership fee. It is also common for affiliate networks to charge merchants a percentage of the commissions paid to affiliates.