AFFILIATE MARKETING

Affiliate Marketing is not and should not be confused with pyramid selling.  It is a popular method of promoting web businesses in which an affiliate is rewarded for every subscriber and/or customer provided through his efforts. It is a modern variation of the practice of paying finder's-fees for the introduction of new clients to a business. Compensation may be made based on a certain value for each visitor ( Pay per click), registrant (Pay per lead), or a commission for each customer or sale (Pay per sale), or any combination.

Some e-commerce sites run their own affiliate programs while other e-commerce vendors use third party services provided by intermediaries to track traffic or sales that are referred from affiliates. Some businesses owe much of their growth and success to this marketing technique, although research has shown in general the increase to be approximately 15-20% of online revenue.

Some advertisers offer multi-tier affiliate programs that distribute commission into a hierarchical referral network of sign-ups and sub-affiliates.

Snowballing, this system rewards a chain of hierarchical publishers who may or may not know of each others' existence, yet generate income for the higher level signup.

In its early days many internet users held negative opinions of affiliate marketing due to the tendency of affiliates to use spam to promote the programs in which they were enrolled. As affiliate marketing has matured many affiliate merchants have refined their terms and conditions to prohibit affiliates from spamming.

 This is an edited article from Wikipedia. The full article can be viewed here.

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