Affiliate Marketing is an Internet-based marketing practice which allows a company to sell its products or services by signing up other websites ("affiliates") who market the company's products for a commission. Essentially, the affiliate markets the advertisers products/services to its users, driving targeted traffic to the advertiser's website.

The affiliate is compensated using one of the following payment models:

• Cost per sale (CPS) shares the completed sales revenue generated between the advertiser and the referring website/affiliate. Typically the affiliate will receive a mutually-agreed percentage of the sale.

• Cost per action (CPA) requires that referred visitors complete a particular action (e.g. fill out a contact web form) in order to be compensated. This provides an incentive for the affiliate to send closely-targeted traffic.

• Cost per impression or cost per mille, requires only that the affiliate displays the advertising in order to receive a commission. This model is less used in affiliate marketing today, but remains popular in display advertising and paid search.

 

Tags: SEO, Search Engine Optimisation, Marketing 19-Jan-09