You have probably heard the term ‘affiliate program‘ many times. People talk about them, advertise them, and promote them.

Every marketer and their pet hamster (including me) have recommended you start your online career by being an “affiliate”.

But has anyone actually defined an affiliate program for you?

Do you understand what being an affiliate is all about?

Whether you’re a newbie or just a little overwhelmed by all the information floating around online, I’d like to help you understand what affiliate programs are and what they can do for you.

An affiliate program (sometimes called an associate program) is basically defined as an arrangement in which an online merchant (such as Amazon.com) pays you a commission to send them traffic.

The term “traffic” simply means visitors.

So, you sign up to be an affiliate of a website and you send visitors to that site. When those visitors take a specific action (most commonly – when they buy something) you get paid.

Simple!

Every affiliate program out there will provide you with what is called an “affiliate link”. This is a special link that identifies you (the affiliate) as the source of traffic.

More about affiliate links in an upcoming article.

Each time someone uses your link or website to click onto the merchant’s website and buys something, you are paid a certain percentage of that purchase.

But how does the site know that YOU sent that visitor? Most sites use a technology called “cookies.” This simply means that a small file is placed on the visitor’s computer identifying you as the source of the referral.

That way the company can know for sure that you should be paid the commission when the visitor buys something.

Most major affiliate programs, including Clickbank, use cookies to identify which affiliate sent which visitor.

There are at least three parties involved in any affiliate transaction:

1. The company who sells the product (or vendor as Clickbank calls them)

2. The affiliate who sends the traffic (that’s you!)

3. The person who visits the site by clicking your affiliate link (the visitor)

Affiliate programs do not bring good profits without some form of effort and organization on your part.

To make money with affiliate programs you will need to learn how to “drive” traffic. Driving traffic simply means sending visitors to a website you are promoting using paid advertising or free marketing methods such as article marketing or social media like Twitter.

Affiliate marketing can be very profitable if you learn the system and promote it the right way. To maximize their profits, most affiliates choose more than one to promote.

There is usually nothing complicated about signing up for an affiliate program. Most programs are free to join.

But there is a downside here that you must avoid.

Since most affiliate programs are free to join, there is a temptation to join many at one time thinking you will be able to promote them all. This can lead to confusion.

My advice is to find a product you believe in and promote it with all your heart.

Become an expert at promoting product X and you will learn how to promote any product. Then you can move on to promoting other products easily.

You see, the success is in the process and in the products you choose to promote.

Once you sign up for a program, you are usually free to place links on your website and in other places.

Affiliates are paid according to a legal arrangement agreed to upon sign-up. Affiliate commissions are based on the number of people the affiliate sends to the merchant’s site, or the number of their referrals who make a purchase or take some other type of action.

There are three basic structures for how affiliates are paid:

1. Pay Per Sale: The most common arrangement. When someone you send to the business’ website buys something, you earn a certain percentage or designated dollar amount.

2. Pay Per Visit: Some companies pay you based on the number of people your link sends to their website, whether they make a purchase or not.

3. Per Lead: You are paid when someone uses your affiliate link to visit the company’s website and opts in, entering some required information (like an email address) the business can use as a sales lead.

Generally speaking, if your affiliate link on your website or other location brings their business traffic or money, the merchant will pay you accordingly.

As an affiliate, you help bring in the customer and the company does everything else: order processing, collecting payment, shipping, etc.

For you, promoting an affiliate program or programs almost adds up to free money. Just look at the benefits you get when promoting as an affiliate.

As an affiliate you never have to …

• Create a product

• Provide customer service

• Have a website of your own

• Provide a download page

As an affiliate you simply promote and get paid. It is simply the easiest way to earn money online.

The company wins too! For businesses, offering an affiliate program is not only an excellent way to sell products online, but also serves as a powerful and cost- effective marketing strategy.

Why? Because you (the affiliate) solve their number one problem – getting enough traffic to their website!

You get paid, and the company gets you to promote for them. A classic win-win!

Now that you know what an affiliate program it’s time to find the right program(s) for you. And that is the subject of my next article!