Affiliate Marketing
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Affiliate Marketing
Affiliate Marketing ÐŽ§is a popular method of promoting web business in which an affiliate is rewarded for every visitor, subscriber and/or customer provided through his efforts. It is a modern variation of the practice of paying finders-fees for the introduction of new clients to a business. Compensation may be made based on a certain value for each visit (Pay-per-click), registrant (Pay-per-lead), or a commission for each customer or sale (Pay-per-Sale)ÐŽÐ (Affiliate Marketing, 2006).
According to Harwood (2005), It takes more than the affiliate just generating traffic to get paid. Most affiliate networks are run on an a CPS (cost-per-action) basis so the customer may have to make a purchase or sign up for a service. ÐŽ§There are a number of affiliate network vendors, including TradeDoubler, DGM, Commission Junction, Affiliate Window and Affiliate Future, which sit between the advertiser and affiliate providing the underlying technology. This includes tracking and reporting on sales made through affiliate programs. The network also receives a commission on a CPA basis. The benefit of running an affiliate program is that its a cost-efficient method of acquiring customers, while enabling smaller Web publishers to monetize their sites. The affiliates can be any size but they tend to be experts at online marketing and customer acquisition, particularly in the field of search engine marketing. Affiliates will optimize their sites and use paid search to gain traffic, which they then pass on to the merchantÐŽÐ (Harwood, 2005, p.24).
Affiliate E-Marketing Companies
Various large affiliate e-marketing companies like Commission Junction, LinkShare, and AssocTrac provide e-marketing and revenue potential for both online advertisers and publishers. Each company is summarized below.
Commission Junction (www.cj.com). Commission Junction allows the bundling of several affiliate merchants through a central tracking system. Promotion of brand name products can be accomplished through text links, banner ads, and product links. The company also offers e-marketing tools to help increase sales and leads. The company offers a suite of marketing products and multi-channel online marketing solutions that assist advertisers in meeting their revenue goals. Advertisers only pay for successful responses and that means risk is low. Advertisers can also increase or decrease their pay rates. Publishers make money by placing on their site, which are used to maximize revenue.
LinkShare (www.linkshre.com). LinkShare provides a web-based suite of tools and services and a pay for performance program. Linkshare provides access to a large number of advertisers who offer programs to affiliates. Advertisers also have access to a large group of publishers who are looking for affiliate marketing opportunities. Advertisers make money by selling services and products. Publishers make money through site traffic and the promotion of advertisers. Advertisers pay publishers a commission in exchange leads and sales as a result of these promotions.
AssocTrac (www.assoctrac.com). AssocTrac is an affiliate management solution that enables online businesses to start and run their own affiliate program. The program allows advertisers an easy way to mange thousands of affiliates. Most tasks are automated. Affiliates can have personalized admin pages. User-based cookies are used to give affiliates credit for future purchase. In addition, publishers can make money with a tiered- based program, which allows them to grow their affiliate programs more rapidly.
Kitguy Website
Kitguy.com offers visitors access to hundreds of do-it-yourself project kits and plans like dollhouses, desks, sailboats, etc. Instead of looking in the back of popular magazines for these kits ÐŽV they all can now be found in one easy place. Kitguy uses affiliate programs link the visitor to manufacturesÐŽ¦ kits, plan, and other products. According to Rosalik, ÐŽ§At KitGuy, I offer the core service – all kinds of information and links to all kinds of kit manufacturer website ÐŽVbundled with links to many related products and services like tools, supplies, home decorating, etc. If, for example, KitGuy can get over $6 – on the average – from one out of 100 visitors (ÐŽ§visitor-to-sales conversion rateÐŽÐ) – then KitGuy can drive millions of visitors to the site at 5 cents per visit – or a cost of $5 per 100!ÐŽÐ (R. Rosalik, EBUS 520 lecture, January 23, 2006).
Kitguy.com and similar websites shows that affiliate marketing is significant as to how commerce occurs on the Internet. There are now many merchants who