Thursday, February 16, 2006

Affiliate Marketing Payment Types Defined

So you've decided you want to take the leap into affiliate marketing, but all those terms are so confusing. You want to know exactly what you'll make each time you sell a merchant's product. Well, look no further, here's a tip sheet with all those options defined.

Percent of Sale

When you sell a merchant’s product, you receive a percent of the sales price. The range for this can be from three percent to as high as seventy-five percent. The majority of programs are set up using this method.

Pay per lead

Some merchants that have a longer sales cycle will offer this type of program. They pay you for the prospect who has come to their website via your affiliate link when the prospect takes a certain action such as filling out a form to get on a mailing list. The range for pay per lead programs is typically from fifty cents to fifty dollars.

Recurring Income

Common among membership sites. The merchant pays you a set amount (or percentage) on a continuing basis as long as the customer you referred remains a customer.

Residual Income

Commissions that continue to pay you each time the customer you referred buys from the merchant. You actually become the virtual "account manager" for the customer except there’s no ongoing work involved. Once your customer is referred and buys the merchant’s product, the merchant remembers who referred the customer and you get commission for all the future sales.

Two Tier

Good if you not only want to promote the merchant product, but also the merchant’s affiliate program. In a two-tier program, you get paid when anyone who joins the affiliate program using your affiliate link makes a sale.

Ad revenue

The premier network for serving text ads on a website is Google AdSense but there are many ad networks that offer a variety of options including both MSN and Yahoo! If you're looking for long term consistent cash flow sources, recurring income, residual income and two tier programs provide good opportunities for you. However, any affiliate program promoted properly has the potential to provide you with good passive income.

Denise O'Berry is a small business expert who helps small business owners take action to grow their business. Visit http://www.whatspossible.com to get your free copy of her Success Strategies Guide: 10 Keys to Success for Small Business Owners.

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