Affiliate marketing is the hottest, most exciting thing in e-commerce these days.
Why is this? Well, everyone wins! Any company selling a product or a service, particularly those that can be marketed at a distance has access to a new marketplace, where they can essentially buy new business at a clearly defined cost, with no extra sales or marketing effort by themselves.
Anyone with a website or any type of publication on the Internet, can sign up with any company looking for affiliates, usually in an areas closely connected to the subject matter of their pages. Adverts can be placed on the affiliates website providing something that is likely to be of interest to the average reader of the webpage. An occasional reader notices something he or she is genuinely interested in, follows the link in the ad and maybe buys something from the company which had been advertising. The company pays the affiliate for bringing the two parties together and everyone is happy.
This mechanism has clear advantages over almost all conventional means of advertising.
The company advertising knows its cost per sale precisely - compare that to TV advertising! Generally a company does not really have more than a guestimate of whether a particular form of advertising is even effective, and companies often lose money by advertising using the wrong mechanism. Affiliate marketing is highly scalable. If a company with a good product pays affiliates well, they can expect exponential growth as their adverts become popular. Two tier affiliate marketing systems provide the potential for even more rapid growth of markets through secondary recruitment of affiliates.
The affiliate has a useful trickle of income, supporting his business even if it otherwise involves nothing more than providing information for free (a common feature of specialised websites).
The customer is better informed and is being provided with precisely the opportunities that he or she is most likely to be genuinely interested in, because that is in the interest of the affiliate.
Is affiliate marketing the future of advertising?