Affiliate marketing is a marketing arrangement wherein an online retailer pays commission to an external website for the sales generated from its referral traffic. This means that a company incentivizes third-parties to drive traffic to its website in return for a commission that is only paid when transactions are made through the referral traffic. The most significant point here is that the retailer has to pay commission to the third party only when the visitor converts into a customer by making an online purchase; and not only when the visitor clicks to go to the site. Therefore, affiliate marketing is much more effective and preferred as compared to other online marketing strategies like PPC marketing and content marketing because it is comparatively lesser expensive, involves lesser risks, requires lesser efforts put in from the retailer himself, and pays only when a sale is made.
Although it may sound new to you, but the basic concept of affiliate marketing dates back to the 1990s when eCommerce introduced sales strategies by sharing revenue with third parties that helped drive sales to the store. This tool gained immense popularity and spread across like fire because it saved the hassles on the store owner’s part, and put the stress into the hands of the affiliates. Today also, affiliate marketing can prove to be an amazing sales channel because of the lowest possible risks involved with higher rewards generated. It is the perfect strategy to sell a product/service while blocking the least possible revenue.
How does affiliate marketing work?
The affiliate marketing program begins by the affiliates choosing products they want to sell, after which they are provided with a unique affiliate code that they can use to refer traffic to the eCommerce site. There are ready text links, banners, and other creative copies whereby the affiliates only have to copy the code and place it on their website to start referring traffic. Interested visitors them click on those links and get redirected to the product site. And, if they purchase the product, the referrer then gets a commission for the same. So, you can say that affiliates work like real estate agents who get commission on the sale of a plot/home.
How transparent are affiliate marketing programs?
Any business requires clarity and transparency between two parties for its success. Understanding this importance, affiliate marketing programs come with several features for both merchants and affiliates that make things simple and transparent. The owner of the eCommerce store can track the performance of the affiliates through an affiliate ID and software. Similarly, the affiliates can also have complete real-time access to all sakes and commission statistics.
How are payments made with affiliate marketing programs?
As mentioned above, affiliates are paid not for clicks made, but for actual transactions, which is why it is considered one of the best marketing strategies as compared to other channels, where the store owners have to spend tons of money only on clicks, without producing any actual conversions. Another thing to understand here is how the payments are made. There are two main types of payment strategies used – pay per sale, and pay per lead. Pay per sale is where the store owner has to pay a decided amount of percentage of the sale price to the affiliate when the purchase is completed. Whereas, pay per lad involves the store owner paying for the visitors who provide their contact information on the target site by filling out a simple contact form. In any case, it is definitely beneficial for the store owner.
Whether yours is a big or small online business, you must take advantage of an affiliate marketing program that will not only help you make more revenue, but will also help in advertising your brand to various sets of audiences. And, if you haven’t even set up a good eCommerce store yet, your first step should be hiring a professional eCommerce Web development company in India to have your website built, keeping the latest trends in mind, so as to attract a large set of audience, whether or not you use an affiliate marketing program.Social tagging: Ecommerce Website Development Company in India > Web Design Company in India > Web Developers in India > Website Designing Services in India