Affiliate marketing is a powerful form of online marketing, and it is both cost-effective and easily quantified.
Affiliate marketing is a specialized form of online marketing that involves the promotion of web businesses through an affiliate. It differs from multilevel marketing in that there is usually only one tier, that is, one level of affiliates involved, and no further recruitment is required. There are many familiar examples of affiliate marketing. A lot of it is done through a pay per click system, where a website (the "affiliate") displays an ad for certain advertisers or merchants, and then receives commission from the advertisers based on the number of users who have clicked on the ad. It overlaps heavily with some other online marketing techniques, since most online marketing strategies involve the same principle: generating the most amount of traffic, and then re-directing the traffic to where it is needed. Therefore, affiliate marketing can also take on many forms depending on the online community that is targeted.
Since the advance of the Internet has given rise to many new online communities such as blogs, forums, and other social networking communities, affiliate marketing can be done on a more interactive and personal level. The advertisers can now get even closer to their affiliates, and the affiliates can have more open communication with each other. Instant feedback and easily tracked results are two main reasons for advertisers or merchants to include affiliate marketing in their online marketing plans. It is also a great way to build brand awareness, since the brands can reach a very specialized audience, especially when combined with other online advertising techniques such as SEO.
Some negative aspects of affiliate marketing stem from the nature of the Internet. The lack of regulation, while ensuring free communication o the Internet, can result in unwanted spam and decrease consumer response. There are also no fixed industry standards or training courses available in this relatively new field, and most of the knowledge associated with affiliate marketing has to be learned via real life experience. Regardless, someone who are familiar with the online subculture and have the know-how of website optimization can combine their expertise to succeed in this fast paced marketplace.