Affiliate Marketing is a phenomenal avenue, for ecommerce especially, to gain additional exposure, leads and most importantly, revenue!  It is known as another spoke in the wheel of online marketing and relies on a unique relationship between a Merchant (store owner) and an Affiliate (website owner).
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Affiliate Marketing starts with a Merchant, or someone who has a product or service they are willing to pay others to promote for them.  Affiliate marketing relies heavily on quality merchants that offer high pay-outs and on savvy affiliates with content-rich sites.
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The most common commission structures are:
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• PPA (Pay Per Action) where a visitor clicks through and is lead to a form to fill out
• PPC (Pay Per Click) occurs when a visitor clicks through to the merchants site
• PPS (Pay Per Sale) based on a percentage of goods sold to visitor�
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*Due to click fraud the most used commission structure is the PPS structure because it is tracked the best with merchandise sold.
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The Affiliate is the owner of a site or blog and agrees to post and maintain text links, banners and other promotional information on their site.  They obtain promotional materials from the Merchant that includes a unique Affiliate ID used to identify their visitors to the merchant.  Affiliates copy and paste the code for the promotional material into their site for use.  When clicked, these banners/links will take a visitor to the merchants’ site (click-through), and when the sale or desired action is completed, the affiliate gets credit for it.
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When the visitor clicks through to the merchants’ site from an Affiliates link, a cookie is installed on the users computer.  This cookie has a “Cookie Life” that varies, but a typical cookie expires in 30 days of initial click-though.  So, even if the user returns to the merchants’ site directly, the affiliate will still get that credit as long as the cookie is still live.
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Good merchants will provide a good product or service while giving a high return making it worth the affiliates time and energy to participate in their affiliate program.  Merchants who provide their affiliates with a variety of good quality banners and links will have more success too.�
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Good affiliates are willing to invest time and energy into making and maintaining their site to increase qualified traffic.  Many affiliates start out as part-time affiliates, but with much research and testing they become full-time profitable affiliates that can resign their full-time jobs.  Again, this takes much doing and many hours developing an attractive site with positioning to attract visitors that will convert sales for them.