Affiliate program

Name of the pattern:

Affiliate program
Associate program

Summary:

In a nutshell, an affiliate program is Internet-specific commission-based selling. Specifics come from the way it’s done. An affiliate (advertiser) puts links to the merchant site in a special “hoplink” format, which has the ID of the affiliate embedded into it, so the merchant know who earned the commission from the specific sale. The sale itself is processed by the merchant, affiliates just send prospects using the hoplinks.

A popular way to run an affiliate program is through an intermediary like ClickBank or CommissionJunction. This way affiliates are more protected from potential cheating on the side of the merchant, and it takes care of technicalities, accounting and commission payments for the merchant, which may be a substantial effort for a small Internet business.

When to use this pattern:

A merchant: When you want more sales. That’s pay-per-sale advertising

An affiliate: To make profit without overhead. Affiliate marketing requires no inventory, no direct selling, no payment processing, no customer service. All you need is traffic, enough eyes to show the advertising to.

Attribution:

Simple commission sales are probably as old as commerce, going back to the times of Babylon and Egypt. The first noticeable successful affiliate program I know of, was Amazon Associates launched in July 1996, but attempts to run some MLM sales and adult advertising in a similar manner existed earlier than that. The first known non-adult affiliate program on the Internet seems to be CDNOW in 1994, but the pattern was not widely recognized until Amazon implemented it.

Related patterns:

Referral, ACE (Affiliate Cash Engine), MLM (boundary with anti-pattern), all affiliate patterns

Related anti-patterns:

See affiliate anti-paterns

Comments:

A number of training programs are available for training in affiliate marketing. I am now working on locating proper ones that I can recommend. However, John Reese’s Opportunity sound like a good way to go.