What type of Affiliate Marketing is {for you}?

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Affiliate Marketing has become so very popular nowadays that is it has become very detailed and multi-faceted. Having clarity to the many ways one can be an affiliate marketer is very useful as you can pick and choose the styles that work for you.

The benefits of affiliate marketing are more pronounced today than ever before. If you live in the UK, you only need to look at the changes within the Highstreet Brands, you’ll see one of the main reasons for the immense popularity of affiliate marketing programs among so many thousands of internet marketers.

Latest web technology has enabled Affiliate Marketers to get their statistics and income figures the moment they make an affiliate sale. It is now possible to use companies like Payoneer and PayPal for invoice and payment processing. This has highly reduced the time that an affiliate marketer needs to wait for his payments to be collected from the merchants.

The Power of Affiliate Marketing

Both Affiliates and Merchants have now realised that Affiliate Marketing is effective for both. The Merchants perceive Affiliate Marketing as an opportunity to advertise their products at a much lesser cost. On the other hand, Affiliates see affiliate marketing as an uncomplicated way of earning profits online by doing something which they like most, and that is web publishing.

Just as the popularity of affiliate marketing has boomed, similarly the outlook of people has changed for the better about affiliate marketing. Affiliate Marketing is no longer considered as a secondary method of marketing by the merchants, or as an additional income source by affiliate marketers. For merchants and affiliates alike, affiliate marketing is now considered as the main source of profits and revenues.

Nowadays we need to analyse what type of affiliate marketing will work best for any person? Are there any differences in affiliate marketing programs? Are the paybacks from these programs the same? Which programs work better than the others?

Are You a PPC or PPP Affiliate?

There are two Categories that any Affiliate Marketing endeavour will fall into and these categories are Pay Per Click known as PPC and Pay Per Performance PPP

1. Pay Per Click (PPC)

PPC is the most popular type of affiliate marketing for affiliates with small websites, and probably the easiest way for an Affiliate to earn money. In this affiliate marketing type, the merchant pays his affiliate whenever a visitor is referred to his site, that is whenever someone clicks through the merchant’s banner or text ads. The affiliate gets paid a certain amount even if the visitor he referred does not purchase anything from the merchant’s site. Typical fees for PPC affiliate programs are small, usually not exceeding a dollar for every click. An example of PPC ads is Google AdSense ads, Contextual ads by Media.net and many more.

2. Pay Per Performance (PPP)

PPP affiliate marketing is well-liked among merchants and is also the most rewarding type for the affiliates. In this type of affiliate program, the merchant pays the affiliate only when his referral converts into an action – that is whenever the visitor he has referred buys something from the merchant’s site or when the visitor becomes a lead. This means that the merchant saves a lot on his own direct marketing efforts. On the other hand, this type of affiliate marketing becomes financially most rewarding for the dedicated affiliate, for commissions in PPP affiliate marketing usually comes in the range of 15% to 20% of the actual product sales. And, in the case of e-products, the affiliate commission can go as high as 70 – 75% of the sale price

Pay-per-performance affiliate marketing can further be classified into two types: Pay Per Sales (PPS) and Pay Per Lead (PPL). Both of these methods are highly popular.

a) Pay Per Sale (PPS)

the merchant pays the affiliate a commission fee whenever the visitor he has referred to the merchant’s site buys something from the merchant’s site Commissions for a generated sale are generally higher than the fee paid to affiliates in a pay-per-click affiliate program.

b) Pay Per Lead (PPL)

The pay-per-lead type of affiliate marketing is a slight variation of the PPS type and is often used by insurance and finance companies and other companies who rely on leads for their company to grow. In this type of affiliate marketing, the affiliate is paid whenever the visitor he referred to the merchant’s site fills up an application form or any similar form related to the business of the company. Compensation for this type of affiliate marketing is based on a fixed fee whose rates approximate that of the fixed fee in the PPS type. Generally, the sales conversion rate is the highest in the case of PPL, because, the visitor is not required to purchase anything but only complete a non-financial transaction, like, filling up an application form, subscribing to a newsletter, etc

Below I will list some of the methods Merchants use to reward their Affiliate Marketers for bringing them clients and increasing their revenues. These Methods are classed based on the depth of the Affiliate Network, it can be classified as single-tier, two-tier, multi-tier and recurrent or passive income.

Single-Tier, Two-Tier, Multi-Tier and Passive Income

These types of affiliate marketing are based on the different levels or tiers in the affiliate network by which payments are made.

i) Single Tier

In a single-tier affiliate marketing program, the affiliates are only paid based on the direct sales or traffic he has referred to the merchant. All the previously mentioned affiliate marketing types (i.e. PPS, PPL, and PPC) fall under the single-tier classification.

ii) Two Tier

In two-tier affiliate marketing programs, the affiliates are not only paid for the direct traffic or sales that he brings to the merchant’s site, but also on every traffic or sales referred by other affiliates who joined as sub-affiliate of the above affiliate marketer.

iii) Multi-Tier

Multi-tier affiliate marketing works the same way, although the affiliate gets an additional commission for a greater number of levels of affiliates in different tiers in the affiliate network. An example would be FlexRev$hare where you get incremental revenue at various levels.

iv) Residual Income Affiliate Marketing

In this type, apart from the affiliate getting paid for every customer, he has referred to the merchant’s site, the affiliate is also paid whenever the customer he has referred goes back to the merchant’s site and purchases another product. Commission for such type of affiliate marketing is based on either percentage of sales or based on a fixed fee. An example would be the Wealthy Affiliate referral program

The above types of Affiliate Marketing revenue channels work differently and may not be suitable for some people. It is very important to be aware of what works for you personally. I know some people will argue and wrestle with this: Multi-level Marketing also known as MLM is a Multi-tier Affiliate Marketing method. It is a highly difficult type of internet marketing and it does not work for everyone, in fact, many legitimate marketers consider MLM as illegal or something which is undesirable.

As an Affiliate Marketer especially at the beginning, you may have to try out different methods and decide which will work best for you. You can then concentrate on those Affiliate Marketing methods that are suitable for your internet marketing business style.

Please leave me some comments and questions below, I love receiving your feedback. Thank you so much for reading my post.