How Do Affiliate Programs Work
Affiliate programs are a great way of giving website owners a share of the profits of the products that they advertise. Affiliate programs are also extremely rewarding for intangible products such as software or online training programs. These products do not generally attract delivery costs or costs per unit, and therefore merchants typically offer affiliate incentives of up to 75% of the sales price. If an item was sold for $100, the affiliate would earn $75 of that sale!
In summary, an affiliate program works as follows:
- The affiliate adds a link to a product on their website. This link is often backed up with a comparison, review or a call to action.
- A visitor clicks on the link and is directed to an affiliate service, such as Clickbank or PayDotCom.
- The affiliate service drops a cookie on the visitor’s machine recording the source of the visitor.
- The visitor is automatically redirected to the product website.
- The visitor clicks the buy button and is directed back to the affiliate service.
- The visitor makes the transaction.
- The affiliate service interrogates the cookies on the visitor’s machine to determine the initial source of the visitor.
- The affiliate program pays the affiliate.
So let’s look at a case study for a particular piece of software to see how this works.
SpinChimp is a new spinner released by Aktura Technology. They sell the software for US$35 and offer the affiliate 50% of the sales price. Aktura Technology use Paydotcom to track their affiliates. Affiliates must therefore be a member of Paydotcom. Most affiliate services are free job.
Once signed up, you need to search for the product in the market place. Clicking on the product link will direct you to a page where you are presented with your personalized product link. This link is used by Paydotcom to determine who to award the sale to (as in step C above).
Next you need to include the link provided above on your website. Most people write an article about the product, pointing out is strengths and weaknesses – you should always be truthful otherwise your visitors will not trust any information that your site offers. The SpinChimp website also has banners on the affiliate page to help affiliates attract clicks. This is common practise for most products.
SpinChimp is a little unique here in that it offers a free three day trial period. Therefore, most people who click on the add will probably not buy the product on that day. Luckily though, most cookies have a long life span – Paydotcom cookies live for 6 months. This means that when the trial period expires, the visitor will either buy the product or discontinue using it. If they click the buy button, they are directed to Paydotcom, and hence the affiliate will still get paid.
So although the process is fairly complex, it is transparent as far as the visitor is concerned, and only requires the addition of a link on the affiliate’s website.
This is a great write up Mark!!