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What is an affiliate program? - Beginners guide

Written/updated by Thomas Skov Iversen

Definition: An affiliate program is the link between you and the online advertisers

Affiliate programs is build upon the market strategy called affiliate marketing. Affiliate marketing can be described using the figure below.

Affiliate marketing figure

As the figure illustrates an affiliate program is the link between your website and the company or brand that wants to advertise. The affiliate program makes sure that the adverts of the advertiser will be shown on your website. You hereby become a partner of the affiliate program and affiliate network. This is also why this kind of network advertising is called partner networks.

If a visitor should drop by your website and click on an advert, the company providing the advert will pay you a certain amount of money in commission for that click. You can use an affiliate program for free, because you will as a partner help display the adverts of the network.

Some affiliate programs and networks do not allow you to choose what companies you want to advertise for. Usually it is the affiliate program that decides what adverts to put on your site. Google Adsense will as an example look at your content and decide based on that which company/brand adverts that should be shown on your site.

Often the adverts shown on your site is also dependent on what campaigns the affiliate network is running at the given moment. Always remember that affiliate programs and the related network also earn money every time someone clicks an advert on your site. For that very same reason they also have an interest in having the right adverts on your site.

Consequently you should also expect the affiliate program to take a large share of every click earning you generate. To explain this look at an advertiser. He pays 1$ for each click leading to his site. But the affiliate network also needs some revenue to survive, so they will take a certain percentage of that 1$. The rest will be left to you, and depending on the affiliate program, this remanding percentage varies a lot.

So pick your affiliate program and network carefully, as it is not all who have your best interest in mind!

Sources: E-Business and E-Commerce management by Dave Chaffey , www.google.com/adsense , www.tradedoubler.com


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