Affiliate marketing is a method of earning money by recommending and promoting somebody else’s products or services. For every sale that is made directly from your promotions, you will receive a commission payment.
This reward model is commonly known as Cost Per Action (CPA) and is more transparent than for example the Cost Per Click (CPC) model.
How much you earn depends on the commission levels set by the advertiser and how many products you sell, advertisers only payout on results.
Whilst CPA is the most common form of payment, some publishers receive payments for leads (CPL), clicks (CPC) or impressions (CPM).
How affiliate marketing works:
1. Potential customer lands on the website of the publisher (the affiliate)
2. Customer clicks an affiliate link that takes them to a landing page detailing the advertiser's product
3. Customer makes a purchase
4. The publisher earns a percentage of the sale as a commission
The affiliate link the customer clicks on has a unique code recognized as belonging to the publisher. The advertiser (the merchant whose product is being promoted by the publisher) tracks the code and pays out accordingly.
Affiliate marketing starts with the advertiser and ends with the customer. The publisher acts as the middleman, promoting the advertiser’s product or service to the customer.