Affiliate Marketing – Most Cost Effective Way to Generate Sales

[28-12-2010]

Affiliate marketing is a powerful online marketing technique many websites are adopting to generate leads or achieve sales. An affiliate is a website owner who, by advertising a company's product or service in his website, redirects his customers to a company's site. Affiliates can place advertiser's links on their websites or email campaigns to promote a company. The company that places the advertisement is the advertiser. The affiliate gets commission based on each lead or sale made by the redirected customer.

The basic idea behind affiliate marketing is that popular sites are in an advantageous position to refer customers. Their referral is sure to have an influence on the customer and the lead to conversion rate increases making popular websites an ideal outlet for online merchants to advertise on.

Affiliate marketing is a low risk business practice that benefits both the advertiser and the affiliate marketing site. It can lead to business for the advertiser as well as building brand image and, for the affiliates they can earn revenue.

Affiliate Marketing is probably the most cost effective way of generating leads and business. It’s mostly based on cost per sale or cost per lead. Statistics indicate 80% of affiliate programs today use cost per sale (CPS) as a payment method. 19% use cost per action (CPA) and the remainder adopt cost per click (CPC) or cost per thousand (CPM) for arriving at commission.

It involves carefully identifying and partnering with affiliates who would be promoting your product and services on their website. Choosing the ideal affiliate involves the consideration of various factors such as whether the products and services match or complement your company product and services and the customers visiting the sites. So, getting professional assistance is vital in planning an online affiliate programme to get quality leads that translates into business. Affiliate marketing involves customised solutions that suit and attract customers to the clients' site. Tracking and reporting to monitor performance is another service professionals take care of. Level of investment is zero in affiliate marketing as the advertiser only pays when a sale is made. Affiliate marketing should therefore be an integral part of an online marketing strategy for reaping maximum benefits.