Affiliate Marketing, Discovering the Differences
Affiliate Marketing Programs are at an all time high in popularity for the internet marketer. You may question, why? There may be several reasons why but the most probable reason is the fact that the benefits of Affiliate Marketing are understood by more people today the ever before.
In today’s environment, both the producer and the affiliate can clearly see the benefits of affiliate marketing are a win-win for both the affiliate as well as the producer. From the producer’s point of view, he/she can advertise their products at a much lower cost and on the other hand the affiliate can see that affiliate marketing is a lucrative way of generating profits online by doing what they like best,
Because of the increased popularity of affiliate marketing, more and more producers and marketers have changed their viewpoint and view affiliate marketing in a new light. Today, the producer no longer sees affiliate marketing as an alternative method to advertise his products, as well, the affiliate as a source of income. For both affiliate and producer alike, they both consider affiliate marketing as a major source of profits and income.
Now you may ask yourself, what is the best type of affiliate marketing program best suited for my needs? You may also ask, are all affiliate programs the same? What about their benefits, are they the same? Are there some affiliate programs that are better than others?
Actually, you will find different types or categories of affiliate marketing, and the number of types will depend on how you may categorize them. The most fundamental affiliate marketing programs, however, will fall into two categories: pay-per-click (PPC), and pay-per-performance (PPP).
Pay Per Click
The most popular type of affiliate marketing for affiliates that have small websites and yields the best and probably the easiest way to generate income is PPC. In this type of program, the producer or advertiser will pay the affiliate every time someone clicks the advertiser’s ad on the affiliates website. On the affiliates website you will find either a banner advertisement or a text advertisement. The affiliate will be paid regardless to the fact that a visitor clicks and buys the product or decides that they don’t want to by the product. The affiliate will be paid. One thing to remember is that with PPC, the fees are typically very low, most times less than a dollar per click.
Pay Per Performance (PPP)
PPP affiliate marketing is the most prominent among producers and is likewise the most profitable type for the affiliates. In this kind of affiliate program, the producer only pays the affiliate whenever his recommendation equates into an action– that is whenever the visitor that clicks the advertisement purchases something from the producer’s website or when the visitor becomes a lead. This indicates a great deal of savings for the producers business. On the other hand, it becomes the most rewarding type for the dedicated affiliate, for commissions in PPP affiliate marketing usually comes in the array of 15 % to 20 % of the actual product sales.
Pay-per-performance affiliate marketing could be more categorized into two preferred kinds: pay-per-sales (PPS) and pay-per-lead (PPL).
Pay Per Sale (PPS)
In a pay-per-sale type of affiliate marketing, the producers pay the affiliate a fee whenever the visitor that was referred to the producer’s site actually purchases something from the producer’s website. Affiliates are often paid on commission basis, although other producers would choose to pay a fixed fee. However no matter what the basis of the fee is, it is normally higher than the fee paid to affiliates in a pay-per-click affiliate program.
Pay Per Lead (PPL)
The pay-per-lead type of affiliate marketing is a small variation of the PPS type and is often utilized by insurance and finance companies and various other companies who depend on leads for their company to expand. In this type of affiliate marketing, the affiliate is paid whenever the visitor he referred to the producer’s site completes an application or any comparable form connected to the business of the company. Payment for this sort of affiliate marketing is based upon a fixed charge whose rates approximate that of the fixed fee in the PPS type.
Aside from these 3 types of affiliate marketing, there are a number of other affiliate marketing types that exist. If the classification is based upon the depth of the affiliate network, it can be classified as single-tier, two-tier, and multi-tier affiliate marketing. There is additionally another type of affiliate marketing that pays the affiliate each time the consumer that he has referred purchases something from the producer’s site.
Single-Tier, Two-Tier, and Multi-Tier Affiliate Marketing
These types of affiliate marketing are based upon the various levels or tiers in the affiliate network by which payments are made. In a single-tier affiliate marketing program, the affiliates are just paid based upon the direct sales or traffic he has described the business. All the previously mentioned affiliate marketing types (i.e. PPS, PPL, and PPC) fall under the single-tier category.
In two-tier affiliate marketing programs, the affiliate is not just paid for the direct traffic or sales that he refers the producer’s website, and also on every traffic or sales referred by numerous other affiliates who signed up with the affiliate program through his suggestion.
Multi-tier affiliate marketing works the exact same way, although the affiliate gets extra commission for a wider number of affiliates in various tiers in the affiliate network.
Residual Income Affiliate Marketing
In recurring income affiliate marketing, the affiliate gets paid not only once for every customer he has referred to the producer’s site. Rather, the affiliate is likewise paid whenever the consumer he referred goes back to the site and purchases another item .Payment for this type of affiliate marketing is based on either sales percentage commission or fixed fee basis.
The different affiliate marketing types would essentially work differently for producers and affiliates alike, and each would normally have their very own list of advantages. Which sort of affiliate marketing will work best for you? It is not actually for me to tell. Rather, it is for you to decide which type of affiliate marketing program will match your requirements and style most effectively.