Affiliate Marketing is a technique used by a variety of web site businesses in which a person or business called an “affiliate” is compensated for sales, visitors, or subscribers provided to another company through the affiliates’ advertising efforts. The affiliate might set up their own, independent storefront, or simply make sales from links placed on their personal web site pages. Merchants that set up affiliate marketing programs are attracted to the business model because they do not make payments to the affiliates until after the results have been made- whether that be from the completion of a sale or the subscription of a new web site visitor.
It is not known exactly which company had the idea for affiliate marketing first; however, the first affiliate program launched in 1994 by CDNow (www.cdnow.com). It was called their “buyweb program”, and consisted of a new concept in which an associate or affiliate would be rewarded for generating purchases for the CDNow website. CDNow allowed other music themed sites to review music or place links to the CDNow site from their own, to allow web site visitors to make purchases.
Soon after CDNow’s affiliate program, Amazon.com created an affiliate marketing program based on the need of a guest at a cocktail party in July of 1996. Jeff Bezos, the CEO and founder of Amazon.com, thought about how he could help a party guest who wanted to offer books for sale through her own web site. He decided he could let the woman link from her site to Amazon’s, and that Amazon would pay her a commission on any books she sold. This became known as the “Amazon Associates Program”, and it allowed other site owners to link directly to specific books and products for sale on Amazon.com to earn a commission on the sales their site generated.
When affiliate marketing first began, the merchants did not have very much control over what their affiliates were doing to advertise. The web was littered with false advertisements, tracking cookies installed on users’ computers that forced the users to click on certain links, and the dreaded adware that causes ads to pop up on people’s computers, unwanted.
Thankfully, over the last few years affiliate marketing programs have learned ways to “look after” their affiliates and make sure they are marketing products and services appropriately. There are third party companies who manage affiliate programs for other companies, including some of the most known affiliate management programs, ClickBank. (www.clickbank.com), LinkShare (www.linkshare.com) and Commission Junction (www.commissionjunction.com).
Currently, one of the fastest ways to earn money online is by using affiliate marketing. In fact, affiliate marketing is the fastest growing industry within the Internet as it is one of the easiest ways to earn a living online. For merchants who offer affiliate programs, it is the most cost-effective opportunity for them to increase their online sales.
Posted by David Olsen - Owner/Editor
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