The Nuts and Bolts of Affiliate Marketing

Affiliate marketing is a world that, as with many other internet-based industries, appears to be crammed with technical words and acronyms that may be confusing and even off-putting to someone without much of a technical background. However, once you`ve peeled back the layers and understood the basics, it`s easy to see how affiliate marketing can be a lucrative business that can either be run simultaneously with a full time job or alternatively be taken on as your main source of income. There are numerous success stories about ordinary people who now have lucrative businesses that originally started in a small way from home.

Affiliate Marketing is where a website (the “affiliate”) advertises another business (the “merchant”) via some form of link. When a customer completes a pre-agreed action (usually a purchase, but in some cases the completion of an enquiry form or survey), a payment is made to the site owner. Sometimes you will receive a commission just for driving traffic from your site to a merchant site, but more often you will receive commission only if the click through from your site results in a sale or other agreed action on the merchant`s site. Because Affiliate marketing is geared to payment on performance, no expense occurs without a successful outcome.

One thing that is not especially technical, yet is one of the most important factors in Affiliate marketing is the possession of a clear strategy. Simply put, this means a knowledge of your potential customer’s habits, interests and how best to communicate the values and benefits you have to offer. When this is clear, it greatly simplifies the construction of an effective affiliate website. There are several elements to consider far beyond the ability to produce interesting graphics and layouts which is where so many affiliate focus far too much of their energy at the expense of other more vital elements. Whilst clean and clear visuals are certainly among the criteria for successful sites, the importance of the site content itself cannot be overstated. It must communicate clearly and immediately the primary reasons why the visitor to the site should read on, also providing a clear call to action that will convert a seeker of information into a buyer. Unique, rich and regularly updated content is also vital in achieving presence in the search engines. The next major element is site functionality, including how you handle queries, orders, as well as other features. For example, newsletters and blogs are excellent tools to gain and retain regular site visits and relevant (usually free) software is available to handle these components, together with regular mailings to subscribers.

If you want to generate decent levels of traffic to your own site as a merchant then you might consider either building your own direct Affiliate marketing program, or alternatively use one of the popular affiliate networks that can take a lot of work out of the management and accounting elements of the process. Unless you have access to a large number of potential affiliates, perhaps through existing channel relationships, the network approach is more likely to be successful. The affiliate networks maintain relationships with affiliates in a wide range of sectors and handle the not insignificant management of these relationships. Depending upon the scale of your business you may decide to use more than one of the affiliate networks. Do, however, bear in mind that the networks tend to charge monthly management fees as well as a percentage of sales or commissions and these costs must be factored into your model. You may also want to use the services of a specialist affiliate management (“AM”) firm who will use the networks` communication tools, together with their own databases and contacts to promote your offering to the best affiliates.

If you are interested in learning Affiliate marketing from the experts then the best place to start is generally an affiliate marketing forum or blog wherein you will find other like-minded affiliates and merchants discussing current trends and hot topics. Most also provide a wealth of static advisory content to assist you in coming up to speed on both the affiliate and merchant sides of the equation.

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