Affiliate Marketing FAQ(#2): How does Affiliate Marketing Work

If you want to make money from affiliate marketing, you must firstly find a product or service to promote. Since there are almost any product out there online, it is not difficult for you to find a great many products you want to sell. Let's say you finally find a merchant selling this product or service. This merchant has an affiliate program and provides a 20% commission for the sales amount.

You need to sign up this affiliate program by filling out an affiliate application form. Once you are accepted by the affiliate program and become an affiliate member, you will get at least one affiliate link which contains your affiliate ID. The affiliate link can be a text link, an image link or a javascript code.

Now you need to promote the products or services by promoting your affiliate links. You can place this affiliate link on your website or send this link to your potential customers by email, or promote this link on others' websites. But before doing so, you must read the affiliate agreement carefully, some merchants don't allow you to promote their products or services in certain ways. for example, you are forbidden by some merchants to promote your affiliate links in email, or bid their trademark as a keyword in search engine PPC campaigns.

As your affiliate links display many times because of your effective promotion, a percentage of potential customers will click your affiliate links and will be redirected to the merchant's website. During this progress, a tracking cookie is set on the visitor's computer. A tracking cookie is a small text file created and stored in your visitor's computer telling your merchant that this visitor is referred by you, but not other affiliates.

And some of these visitors will surely take required action, maybe make a purchase or leave their valid contact information to the merchant. Then you finish your job and your commission will be credited.

Normally, merchants pay their affiliates on a period basis. let's say, an affiliate program pays its affiliates by check or Paypal every month and the minimum payout is $50. So if your account balance exceeds $50 this month, you will get your payment in next month. This is a very simple example, but in order to prevent fraud, most affiliate will keep your commission pending for a certain period, for example, 30 days or 45 days.

Why the affiliate can only get commission when the visitor referred take required action? Because Affiliate marketing is mainly performance marketing, which is also called CPA (Cost Per Action). There are 3 types of required actions:

1. Pay-Per-Sale (PPS): the merchant pay their affiliates a percentage of sales amount or a fixed amount for the sales generated from their affiliate links.

2. Pay-Per-Lead (PPL): the affiliates earn a fixed amount when your visitor leaves his valid contact information and fills out a survey or requests a quote or information.

3. Pay-Per-Click (PPC): you get paid when you visitor clicks your affiliate link and go to your merchant's website.

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