To put it in simple words an affiliate program is nothing but a revenue sharing arrangement between two different parties. The party which offers the affiliate program is known as the affiliate merchant and the party that accepts the offer is generally known as the publishers, affiliates or sales persons.

How does an affiliate program work?

Affiliate program is strictly a performance based marketing program which involves the affiliate merchant paying out commissions to his affiliates for any sales leads generated by their referred visitors. There are may commission schemes like pay per click scheme, pay per sale scheme, pay per referral, life time commissions, two tier commissions etc that the business can decide to pay to its affiliates on a fixed time bases.

Why do businesses start an affiliate program?

The main reason why a company offers an affiliate program is to promote goods and services. There could be many related reasons like beating competition, following trends, experimenting with new techniques, decreasing marketing costs, increasing website traffic, developing product/service awareness etc. But the primary motive of any affiliate program is to promote products/services and generate sales.

Why join an affiliate program

Affiliate programs are a win-win marketing strategy with both parties taking benefits. A webmaster joins an affiliate program primarily to make money, to leverage his website potential, to provide value added to his visitors and to increase the value of his website.

Affiliate programs give benefits both to the affiliate merchant as his goods and services are promoted and his affiliates as he can earn good money increasing their popularity in the present context.