Some Internet Marketing Terminology explained..............What is affiliate marketing?

What is affiliate marketing?

the days when the guy from the insurance company would come and sit in your kitchen and try to sell you insurance? The “older” generation reading this will remember. When he sold you some, his boss – the insurance company – would pay the sales guy say, 10% commission. That is affiliate marketing the old fashioned way. I guess you could also call it commission marketing because that’s what it is: somebody gets paid commission for selling somebody else’s product. The insurance company is the affiliate merchant, or vendor, and the sales guy is the affiliate as he gets commission from a sale.
Now imagine this scenario on the internet: the insurance company has a website that sells insurance. The sales guy has a website that tells you the pros and cons of insurance and here and there on his website he puts a link that, when you click on it, you have the chance to buy something. If you buy via that link, the insurance company will pay the sales guy commission.


So in this case you are the sales guy that will be selling for other companies, and every time you sell something, the company will pay you commission. You are the affiliate (the one who receives the commission) and the insurance company that will pay you is called the merchant or the vendor. All you need to do is put the same affiliate links on your website that refer to the insurance companies’ website, and you get paid when somebody buys via that link. Where and how to get your money making affiliate link will be covered later in the book. Everything else is automated. Commissions range from 1% to 75%. Physical products usually pay between 2% and 25% commission but https://www.Clickbank.com, which sells mostly digital products, can pay up to 80% commission or even more.

A merchant is an online retailer with a website where you can buy products or services.

An affiliate or online publisher is the person who drives visitors to the merchant’s website and gets paid commission when customers buy something by clicking on the link that is on the affiliate’s website. An affiliate drives buyers to the merchant’s sites and gets paid for it. The merchants pays the affiliate commission only when a sale is made. The affiliate will sell your product or services for a commission. Affiliates are other internet marketers or other website owners.
www.amazon.com is a good example of a successful affiliate merchant business, which it started in 1996. They now have over 400,000 affiliates (Amazon calls them associates). A vendor is the person who is selling his goods on Amazon and Amazon gets paid commission (or a vendor’s fee) every time the vendor sells something. The vendor of course gets the money for the purchase of the goods (minus Amazon’s commission). All administration and collecting of the money is done by Amazon.

www.amazon.com and www.comparethemarket.com are probably two companies that you have heard of before but never realised that they made money in affiliate marketing.

Amazon is a merchant as you can sell their products as an affiliate but in a way Amazon is also an affiliate network as all administration is done by them.
Affiliate marketing is literally everywhere on the web. Websites without any money-making links are hard to find these days.

Affiliate networks are automated websites on which merchants can put their name to say they are looking for affiliates to drive traffic to their websites. You, as an affiliate, go to the affiliate network to grab an affiliate link to put on your website. The affiliate network pays you your commission. All you need to do is stick a link on your site and drive traffic, all the rest is done automatically for you. I will give some examples of trustworthy networks later in this book.

Affiliate marketing is the whole automated set up to do with affiliates, merchants and affiliate networks.