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Abstract
Purpose - This article seeks to explore the inner workings of affiliate marketing.
Design/methodology/approach - Defines the affiliate marketing marketplace including some of the participants and explores the characteristics of a successful long-term relationship.
Findings - The key to successful affiliate marketing lies in the construction of a win-win relationship between the advertiser and the affiliate. Affiliate
marketing is likely to become the principal mainstream marketing strategy for e-commerce businesses in the future.
Originality/value - Looks at the inner workings of affiliate marketing, defines the affiliate marketing marketplace including some of the participants and explores the characteristics of a successful long-term relationship.
Keywords Internet marketing, Marketing strategy
Paper type Case study
Overview
Affiliate marketing has become a major strategic consideration for all companies participating in e-commerce. The concept has certain technological complexities that have been made simpler through the development of several network companies that facilitate the tracking and settlement of payments between various companies on the internet. The strategy represents the ultimate in genuine pay for performance marketing and, as a result, represents one of the most promising long-term marketing strategies for e-commerce. In this article we will explore the inner workings of affiliate marketing, we will define the affiliate marketing marketplace including some of the participants and we will explore the characteristics of a successful long-term relationship.
Affiliate marketing overview
Many marketers, even those involved in e-commerce, know little or nothing about affiliate marketing. Some understand the basic concepts - as pure pay for performance marketing. But often the understanding stops there. Let's explore what affiliate marketing is and how it works. To draw a simple comparison, I will remove the complexity of the technology and the internet and use a more traditional marketing tactic to illustrate the concept of affiliate marketing.
Imagine that you are a catalog marketer. You have hundreds or thousands of products that you sell. You process customer orders over the telephone and through the mail. You generate customer interest by mailing printed catalogs with pictures, descriptions and prices of the various products you sell. You fund the marketing expenditures that are required to get the customer to pick up the phone and place an order. You bear the risk that the sales and gross profits associated...