As a merchant of any kind (tangible or intangible products), you would be looking for performance in sales. Looking to establish the marketing costs level to something you are willing to pay (and not more) has been always an ideal… until the appearance of internet affiliate programs. Merchants have been in search of performance based deals.

Internet is the media that actually can deliver fairly and offers greater measurability compared to traditional media (such as newspapers, radio, television, outdoor).

First off all, let me point out some things about affiliate programs, so that you all know how it works if you are not familiar with.

An affiliate program has two main sides: the advertiser (that want to promote his services / products and get leads) and the publisher (that promotes the services products on his own website / blog and generates leads to the advertiser). The affiliate program is hosted either by the advertiser, or in other cases it is provided by a third entity, the affiliate network, that acts also as a marketplace facilitating the meeting between advertisers and publishers.

Either way, the program offers incentives / commissions to publishers that promote an advertiser’s product or service, and it generates leads. This is the key factor in affiliate systems: leads, or in other cases action, sale. When a publisher refers a visitor that takes a certain action (registers with the advertiser or buys a product), he is entitled for a commission paid by the advertiser. The commissions can be a percent from the value of the transaction made by the referred customer, or a flat fee for each lead, or a combination of these two.

Now, as you got familiar with the idea of an affiliate program, let me list the reasons to use one:

• best way to promote and bust your sales, to get leads (no more paying for visitors w/o taking action)
• complete control over marketing expenses (the percent or flat fee will assure an easy to control marketing budget)
• high ROI, based on pay per performance
• promote over a network of publishers better engaged in selling the product or service
• publishers act as a sale team, paid only when results are achieved
• global reach or limited to a geographic area (as the merchant wish)
• enjoy optimization tools
• professional support if an affiliate network is used
• easy management tools of all affiliate partners

Of course, the affiliate marketing comes with some disadvantages as well, such as limited reach to customers (limited to the publishers’ visitors) or the fact that affiliation doesn’t help in developing your brand. Also, the commissions paid to publishers must at an attractable incentive level for them to chose promote the merchant.

If you, as a merchant, need to get the expected ROI, than affiliation is recommended (CPA based), while for increasing brand awareness the other advertising methods (based on CPC, CPM, CPV) are a must.

To see a list of potential affiliate networks that could be used by merchants in boosting their sales, click here.