Computer and Internet (Q&A)

Answer:

Affiliate Marketing is an Internet-based marketing  practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate's marketing efforts. Companies run affiliate programs to generate leads and sales from other Websites. They pay the sites who host their ads a commission for products sold through the links on their sites. For example, if a site owner signs up for Amazon.com's affiliate program, he will receive ad banners or links from Amazon.com that he can place anywhere on his site. Then, if a visitor clicks on the Amazon.com banner or a link on his site and buys something, he will receive a commission. Unfortunately for Website owners, affiliate commissions are seldom above 5%, since most Web sales are made with small profit margins.

The introduction of Website affiliate programs in the late 1990s brought Internet marketing to a new level. The first companies that offered these programs saw sales increase dramatically. After all, these companies basically get free advertising and only pay their affiliates a percentage of the sales they generate. It is a win-win situation for the company that runs the affiliate program. The only drawback is that the programs take a lot of work (and sometimes a lot of money) to set up and maintain. Thus, smaller companies may not find it very beneficial to offer an affiliate program.

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