The benefits of affiliate marketing is more pronounced today than before. This is one of the main reason for the immense popularity of affiliate marketing programs among so many thousands of internet marketers.
Latest web technology has enabled the affiliate marketers to get their statistics and income figures the moment they make an affiliate sale. It is now possible to use companies like PayPal for payment and receipt processing. This has highly curtailed the time that an affiliate marketer needs to wait for his payments to be collected from the merchants.
Both the affiliates and the merchants have now realised that affiliate marketing is effective for both of them. The merchants perceive affiliate marketing as an opportunity to advertise their products at a much lesser cost. On the other hand, the affiliates see affiliate marketing as a uncomplicated way of earning profits online by doing something which they like most, and that is web publishing.
Just as the popularity of affiliate marketing has gone into overdrive, similarly the outlook of people has changed for the better about affiliate marketing. Affiliate marketing is no longer considered as a secondary method of marketing by the merchants, or as an additional income source by an affiliate marketer. For merchants and affiliates alike, affiliate marketing is now considered as a main source of profits and revenues.
We now need to analyze what type of affiliate marketing will work best for any person? Are there any differences in affiliate marketing programs? Are the paybacks from these programs the same? Which are those affiliate marketing programs that work better than the others?
There are actually varieties of affiliate marketing, and the types will depend on how you are going to classify them. The primary classification of affiliate marketing programs falls under two categories: pay-per-click (PPC), and pay-per-performance (PPP).
1. Pay Per Click (PPC)
PPC is the most popular type of affiliate marketing for affiliates with small websites, and probably the easiest way for them to earn money. In this affiliate marketing type, the merchant pays his affiliate whenever a visitor is referred to his site, that is whenever someone clicks through the merchant’s banner or text ads. The affiliate gets paid a certain amount even if the visitor he referred does not purchase anything from the merchant’s site. However, typical fees for PPC affiliate programs are small, usually not exceeding a dollar for every click. The most popular types of these are Google Adsense.
2. Pay Per Performance (PPP)
PPP affiliate marketing is well liked among merchants and is also the most rewarding type for the affiliates. In this type of affiliate program, the merchant pays the affiliate only when his referral converts into an action – that is whenever the visitor he has referred actually buys something from the merchant’s site or when the visitor becomes a lead. This means that the merchant saves a lot on his own direct marketing efforts. On the other hand, this type of affiliate marketing becomes financially most rewarding for the dedicated affiliate, for commissions in PPP affiliate marketing usually comes in the range of 15% to 20% of the actual product sales. And, in the case of e-products or e-goods, the affiliate commission can go as high as 70 – 75% of the sale price.
Pay-per-performance affiliate marketing can further be classified into two types: pay-per-sales (PPS) and pay-per-lead (PPL). Both these are highly popular.
a) Pay Per Sale (PPS)
In a pay-per-sale type of affiliate marketing, the merchants pay the affiliate a certain fee whenever the visitor he has referred to the merchant’s site actually buys something from the merchant’s site. Affiliates are often paid on commission basis, although other merchants would opt to pay a fixed fee. But no matter what the basis of the fee is, it is generally higher than the fee paid to affiliates in a pay-per-click affiliate program.
b) Pay Per Lead (PPL)
The pay-per-lead type of affiliate marketing is a slight variation of the PPS type and is often used by insurance and finance companies and other companies who rely on leads for their company to grow. In this type of affiliate marketing, the affiliate is paid whenever the visitor he referred to the merchant’s site fills up an application form or any similar form related to the business of the company. Compensation for this type of affiliate marketing is based on a fixed fee whose rates approximate that of the fixed fee in the PPS type. Generally, the sales conversion rate is the highest in the case of PPL, because, the visitor is not required to purchase anything but only complete a non-financial transaction, like, filling up an application form, subscribing to a newsletter, etc.
Aside from these three specific types of affiliate marketing, a lot of other affiliate marketing types exist. If the classification is based on the depth of the affiliate network, it can be classified as single-tier, two-tier, and multi-tier affiliate marketing. There is also another type of affiliate marketing that pays the affiliate each time the customer he has referred purchases something from the merchant’s site.
Single-Tier, Two-Tier, and Multi-Tier Affiliate Marketing
These types of affiliate marketing are based on the different levels or tiers in the affiliate network by which payments are made.
A) Single Tier
In a single-tier affiliate marketing program, the affiliates are only paid based on the direct sales or traffic he has referred to the merchant. All the previously mentioned affiliate marketing types (i.e. PPS, PPL, and PPC) fall under the single-tier classification.
B) Two Tier
In two-tier affiliate marketing programs, the affiliates are not only paid for the direct traffic or sales that he brings to the merchant’s site, but also on every traffic or sales referred by other affiliates who joined as sub-affiliate of the above affiliate marketer.
C) Multi Tier
Multi-tier affiliate marketing works the same way, although the affiliate gets additional commission for more number of levels of affiliates in different tiers in the affiliate network.
D) Residual Or Recurring Income Affiliate Marketing
In this type, apart from the affiliate getting paid for every customer he has referred to the merchant’s site, the affiliate is also paid whenever the customer he has referred goes back to the merchant’s site and purchases another product. Commission for such type of affiliate marketing is based on either percentage of sales or based on fixed fee. Recurring income occurs when someone pays for a service on a monthly or annual basis and you receive a percentage of those fees as long as they continue with that service.
Every affiliate marketer finds that these different affiliate marketing methods work differently for each of them.
An affiliate marketer has to try out different methods and decide which will work best for him or her. He/she should then concentrate on those affiliate marketing methods which are suitable for his/her style of internet marketing business.
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#1. Creating A High Converting Lead PageA sales funnel is the process visitors go through when the click on your affiliate link. Usually the first place they are sent to is a lead page or capture page which is designed to collect their email and add it to your list. Once they enter their email they are taken to the offer where hopefully the buy it which earns you a commission.
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#2. Building An Email List Of People Interested In Your Productmost professional online marketer will tell you that "the money is in the list". although that is only partially true (you will learn why in the training). What they know is that most do not buy a offer when they first see it. They want to know if it will work for them, might be a scam or simply does not do what they ad promises.
Usually visitors will have one or more objections as to why they should not to purchase the offer. You need to as a successful affiliate markerter is be able to provide more information that answers any questions and removes the objections that they may have. This will result in substantially more conversions and means more comissions and earnings for you.
With your very own email list you will be able to follow up with anyone who have expressed interest in your product or offer. Also it gives you the opportunity to send them new offers whenever you choose.
#3. Getting The Right Kind Of TrafficWithout the right kind of website traffic visiting your offers you will not make many sales or any sales at all. Targeted traffic is the most important part of affiliate marketing. You need prospects who are interested and will gladly pay for what you are promoting. You will be shown two sources that can provide the targeted traffic you want.
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