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A way to earn money online: Affiliate marketing

Posted on February 1, 2021

Affiliate marketing is an online marketing strategy that is based on the following principle: an advertiser, whether a company or an eCommerce, pays another company to help them sell and promote their business. And an affiliate who agrees to promote the product or service, billing follows the principle of commission mediation.

It is based on the "pay for results" model and works as a channel through which small or large scale brands, which seek to promote their products and services, pay in an agreed manner to those who help promote them on their websites, blogs, fanpages, etc.

This model involves 2 parties:

The merchant (advertiser) aims to market his products or services on external websites, for which he uses advertising media such as banners and offers a commission.

The affiliate makes its advertising space available to the merchant and therefore the scope of its website. The affiliate acts as an interface between the merchant and potential customers by including advertising in the form of banners or so-called affiliate links in the publications.

Benefits of affiliate marketing

  • Profitable: The advertiser only pays if the customer performs a specific action that interests him. You can request to increase clicks to certain links, conversion of the customer into a user, either subscribe, get customer data, etc.

  • Simple analytics: Affiliate programs can be easily tracked through statistics and data with which to perform metrics, comparisons and studies.

  • Constant income flow: Even without being behind the computer, being a job that depends on traffic, redirects and purchases over the Internet you can make money at any time.

  • Safe work: There is practically no risk, you do not have to invest in products or services to market but "promote" the items of other companies. In the same way, affiliate marketing does not pay if the process does not work.

  • Simply sell what is related to your sector: If you happen to have a very well positioned blog about sports, the most logical option is to sell sports products. If you have good content you can get adequate traffic to channel towards the ecommerce with which you maintain the affiliation. Don't sell products that have nothing to do with your theme.

How does Affiliate Marketing technically work?

It is based on a well known but little explained technology: "cookies", which allow to track information and data from the Internet, in this case links and banners, in a proper way. A cookie is a technology, programming code, with which browsers work to store different sets of data about the behavior and actions of users when browsing the web: from which pages they have visited, the records they have made, passwords they have saved or the content they have dumped into a virtual shopping cart.

Affiliate marketing uses this technology to remember the link or ad that a visitor has clicked to go to another website. They store the date and time, what types of content and sites the user frequents. 

Surely you are wondering which are the payment models that this program presents, very well, here we will detail all the models that can be presented.

There are several ways to obtain remuneration in terms of membership.

Payment models

Pay per sale

The pay per sale or pay per order model is the best known in affiliate marketing. Payments take place if a customer is obtained. In this case, the commission is paid when a user clicks on the affiliate link or banner on the merchant's website, buys a product or places an order. A fixed amount or a certain amount may be paid depending on the product, but a combination of both options is also possible. Generally, for customers who do not buy immediately, the affiliate also receives a commission. In this sense, cookies help test the validity of the product link (30-60 days).

Pay per click

In the pay per click model, as its name suggests, payment is made according to the number of clicks achieved. This is a model that is used less and less, despite the diffusion it enjoyed in the initial period of affiliate marketing, mainly because of its simple technical implementation. Over time, it has shown that the return on investment (ROI) is relatively low for the merchant, as are the prices that have to be paid for each click.

Pay per click out

In the case of pay per click out, the visitor must click at least one second on the merchant's website. In this way, the disadvantages of the pay-per-click model are reduced. A second action by the potential customer will result in the payment of the commission.

Pay per lead

In the pay per lead model, the remuneration is paid each time a customer contacts the advertiser, e.g. when filling out a contact form or requesting information material. Pay per lead is often used for products that require intensive advice, such as insurance or cars. Since customers do not usually sign such contracts immediately, another payment model would not make much sense for these products that require thought. The merchant pays the commission to the affiliate for the established contact or lead.

Payment by registration

Pay per sign up is one of the pay per lead types in which the affiliate receives a commission when the user signs up on the merchant's website. 

Payment by installation

Pay per install is a form of the pay per sale model. The user will pay a commission the first time a software is installed, which is often set in the browser toolbars or in the free trial versions. 

Pay per link

Pay per link is often used in advertising features and sponsored messages. For example, a blogger will receive a commission when he links to a merchant's product in one of his posts.

Lifetime compensation

In the case of lifetime remuneration, the affiliate receives remuneration even after the customer's first action. The concept of "lifetime" refers to the period of time in which the new customer remains loyal to a company. Merchants often use this type of remuneration when they offer subscriptions (e.g., in the case of contact portals). The affiliate is remunerated at the end of the subscription and each time the current contract is extended.

Remuneration by duration of communication

The principle of remuneration by duration of communication is found in the telecommunications sector and is used, for example, by cell phone operators. In this respect, the affiliate receives a commission (for a certain duration) for every minute paid by the customer for each operation.

Are you in affiliate marketing or want to try it? In Gila CMS we are looking for new partners who will find the right leads for our products and services. Check out our referral program description and contact us.