Affiliate marketing is the marketing technique in which a commercial relation is established between smaller entities with a larger one in which the larger entity doesn’t directly control the small one. It can be well understood by considering this example. Suppose a bigger company selling a particular product asks a smaller company to help it sell the products and in return the smaller company will have a percentage share in the amount of sale that it will generate. This is the core of affiliate marketing but it also involves several other complexities and procedures at a bigger level.

The entire process of affiliate marketing involves three key players who function together as a complete business model. The first one is a merchant who is the seller of a particular brand or business. The second one is an affiliate or the publisher who builds

the second line of marketing for the merchant. The last one is the customer who buys the marketed brand or product. The entire process of affiliate marketing goes step by step. First a deal is signed between the merchant and the publisher or affiliate which outlines the various terms and conditions. The affiliate then sets out to bring customers through its own network to the merchant. Upon successful completion of deal, the affiliate gets the reward as laid in the agreement. A proper setup is made to track every visit of a visitor from the affiliate’s network to the merchant’s network. This ensures that there is no biasness in giving sale share to the affiliate. Several affiliate marketing websites are now available on the internet which provides such facilities. Affiliate marketing also uses the regular internet marketing features like displaying advertisement, Search engine optimization, pay per click, e-mail marketing etc. The web 2.0 has greatly increased the scope of affiliate marketing with the concepts of blogging, forum, social media etc. Both the affiliate and merchant should make sure that they share a common interest base. For example it is useless to have a health insurance affiliate for a technical product sale. Successful affiliate marketing involves considerable effort from both merchant and the affiliate. With proper strategies, affiliate marketing can prove beneficial for merchant as well as the affiliate or the publisher. In the recent time relatively new outsourced program management companies have mushroomed which perform affiliate program management for the merchants thus facilitating their work process.

Even though affiliate marketing is widely used over the internet still there have been several negative issues related to it. There have been several incidents where the affiliates use spam, adware, false clicking and other illegal means to drive traffic to the merchant website. Hence the merchants should make policies that can prevent them from such fraud cases. Affiliate market is rising continuously and statistics foresees an increment in this domain of marketing.