Affiliate Marketing
Affiliate marketing is when a website sells a service or product of another company. It varies from traditional marketing because affiliates are only paid when a specific action is performed; you only pay for impressions or clicks.
To some degree, affiliate marketing overlaps with other online marketing methods. Those methods include organic search engine optimisation (SEO), paid search engine marketing (PPC – Pay Per Click), e-mail marketing, and in some sense display advertising. On the other hand, affiliates sometimes use less orthodox techniques, such as publishing reviews of products or services offered by a partner.
The process of affiliate marketing is composed of three basic elements;
- The Owner – the seller of the service or product,
- The Consumer - that is going to buy the service or product,
- The Affiliate – who will market what the owner is offering.
The most successful way to utilise affiliate marketing is to meet the needs of the consumer. Consider what you, the owner, provide and who this most appeals to. Ask yourself why people are coming to your site and ensure that what you are providing a solution to what the consumer is looking for.
Affiliate marketing is considered a relatively cost effective method of marketing because the affiliates are doing the hard work for you.
As the affiliate, it is wise to change the ads around frequently, use different graphics and text and run split tests to see which ad is working best. Reports can be generated which will track the source of customers and this will give you an idea to which ad, whether it be colour scheme, call to action or text is working best.
It may take several months before you know which ad performs better and generates clicks.
Change the ads around every month to be noticed more, people take notice of change.
Affiliate marketing for the owner will give more exposure and is a cheap way of advertisement, however affiliate programs aren’t a get rich quick plan – it provides the opportunity to make passive income in the future.
A report from; The eConsultancy Affiliate Marketing Merchants Report 2007 revealed that Affiliate marketing in the UK grew by an estimated 45% during 2007, taking the total value of online sales generated by this channel for that year to over £3 billion. With a conservative estimate of commissions and fees paid out to affiliate networks amounting to £186 million, an increase of 40% on 2006.
The same report found that UK merchants involved in affiliate marketing drive 16% of their online sales via this channel and that 78% of them expected to be “more reliant” on affiliate marketing by 2009.
To benefit from affiliate marketing it is vital that the profit margin on the product or service is large enough to accommodate commission payments. However, it is wise to take into consideration that if your customers make regular repeat purchases, it may be worth sacrificing the profit on one sale to continue to make more sales in the future.
About jadecoleman:
Jade graduated with a Bachelor of Arts with Honours in Journalism and Editorial Design in 2010, since then Jade has worked within the Marketing sector experiencing, SEO, PPC, Link Building and Advertising along with Copywriting and Print Design.
