A website (publisher) which signs up to a merchant's affiliate program features advertisements (often known as banner ads) for the merchant's products or services on their website. Consequently the publisher, as an 'affiliate', earns a commission if a sale results (cost per sale) or simply if the merchant's website is visited (cost per action).
The shopper's origin is traced by a unique affiliate id which is associated with them once they click on the advertisement.
Affiliate Marketing allows a website publisher to earn extra revenue through advertising and the merchant to build a network of advertisers and generate sales revenue.
There are various software solutions that enable merchants to run their own programs independently. Among the advantages of these are they reduce the need to pay third parties for the use of their program running services. It should be appreciated however that running your own in house will be more resource & management intensive.
Conversely making use of third party affiliate program running services will incure associated charges, but they do present a lower entry level hurdle & can promote your program by adding your to their merchant directory etc.
In both cases there will be the need for merchants to design & create banner adverts of various standard shapes & sizes for the affiliates to feature on their websites.
On the left is a working example of an Affiliate advert. In this case we are in the role of the Affiliate, featuring the advert on our page. We have signed up to the affiliate program being run by Amazon, who are the merchant. As explained above, if you click on the link & buy 'The Complete Guide to Affiliate Marketing', we will get paid a small commission...no pressure.
More information on Affiliate Marketing can be found by clicking here.