Affiliate Marketing-Consistent And Profitable
In November 1994, just after the world wide web was born, a company called CDNOW came up with an online way of selling called “BuyWeb” – a click through purchasing set-up that functioned independently from the storefront. This was the first profitable form of affiliate marketing, and many other online and e-commerce sites soon followed suite with similar programs (Amazon.com being an example.) Affiliate Marketing has now become a consistent method of advertising and selling, and now forms a large part of many company’s marketing strategies. It is cheap, effective, and has little to no risk for all involved.
— Chip McLendon (@Twistedplanets) December 7, 2018
Traditionally, affiliate marketing functioned on cost-per-click systems, which means that the ‘affiliate’ was paid for every advert or email clicked on or from their website. However, due to many fraudsters taking advantage of this system by using spam techniques, doing false advertising, creating ad-ware, using forced click techniques, doing SEO ‘keyword stuffing’, using tracking cookies and many similar techniques, the cost-per click system is not as popular as it once was. Merchants now rather use CPA (Cost-per-action) or CPS (cost-per-sale) techniques – both being very similar in that an affiliate receives commission or a revenue share when a person subscribes to the merchant or buys a product from them from being referred by the affiliate’s site. These methods present little to no risk for both the merchant and the affiliate, and are therefore preferred. However, Google’s new Latent Semantic Indexing could mean that CPS will become risk free as well (Latent Semantic Indexing will automatically fish out websites with nonsensical content, or that have keyword stuffing or are advertising sites that are not comparison or shopping sites.)
Affiliate Marketing-Highly Cost effective, Highly Efficient
The Internet has fast become an efficient and trusted way for companies to market and sell their product. One of the reasons for this has been the rise of “Affiliated Marketing” – which is when a website directs traffic to itself through adverts on other (usually related) websites. Affiliated marketing either pays the affiliate through a pay-per-click program (the affiliate receives money every time an advert is clicked) or a pay-per-sale program (the affiliate receives commission every time a posted advert on their site generates an actual sale or subscription.) Generally, the pay-per-sale program (also called cost-per-sale, or CPS) is the tried and trusted form of affiliate marketing used.
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— Affiliate Marketing Knowledge (@affmarknowledge) December 7, 2018
Affiliate marketing began just four years after the world wide web was launched, originally popularized by well known companies such as CDNOW or Amazon.com. Google’s Adsense is also a very well known type of affiliated marketing, but is not really considered as true affiliate marketing as the adverts usually centers around the theme of the website they are displayed (known more as contextual advertising.) Google does not also directly sell a specific product, but generates money in other ways.
Affiliate marketing is highly cost-effective, and in effect costs both the advertiser and the affiliate nothing, while having the potential of bringing in a very large form of income for both parties. While pay per click (or cost-per-click) mentioned above can present a risk to the advertiser, the cost-per-sale (CPS) system has very little or no risk at all for both parties, and is therefore preferred.
Affiliate Marketing-Simple, Yet Effective
Affiliate Marketing has increasingly become an integrated and large part of a company’s marketing plans – most notably for companies that wish to use the internet to gain revenue or sell products. For this reason, e-commerce owes much of its rise to the idea of affiliated marketing, which includes websites such as CDNOW (BuyWeb) or Amazon.com.
The idea of affiliated marketing is profoundly simple yet incredibly effective. Basically, a webmaster will display a merchant’s adverts on a site, and be paid for those websites in one of three ways. Either, he will be paid per click (known as Cost-per-click, CPC for short) which means that every time the advert is clicked, the affiliate is paid. This is not the favored form of affiliate marketing due to many fraud click sites, the rise of adware, and other fraudulent schemes.
Another method of payment is Cost-per-Action (CPA) which is when the affiliate receives income based on either a sale, registration, or the ‘action’ of the person who has clicked the advert from the affiliate’s site.
The last form – and most favored form – is the Cost-per-sale method (CPS) which is based solely upon sales or purchases generated on the merchant’s site, that have come through the affiliated site. CPA and CPS are very similar in this respect, and represent a form of revenue sharing or commission plan.
Affiliate marketing has many benefits for both the affiliate and the merchant, one being that there are no real risks at all for both parties – and both parties find it very beneficial. Merchants enjoy affiliate marketing, and it has become a favored form of advertising for e-commerce business.