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| Affiliate
marketing is an Internet-based marketing practice
in which a business rewards one or more affiliates for each
visitor or customer brought about by the affiliate's marketing
efforts.
Affiliate marketing is also the name of the industry where
a number of different types of companies and individuals are
performing this form of Internet marketing, including affiliate
networks, affiliate management companies, and in-house affiliate
managers, specialized third party vendors, and various types
of affiliates/publishers who promote the products and services
of their partners.
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| Affiliate
marketing overlaps with other Internet marketing
methods to some degree, because affiliates often use regular
advertising methods. Those methods include organic search engine
optimization, paid search engine marketing, e-mail marketing,
and in some sense display advertising. On the other hand, affiliates
sometimes use less orthodox techniques, such as publishing reviews
of products or services offered by a partner.
Affiliate marketing—using
one website to drive traffic to another—is a form of
online marketing, which is frequently overlooked by advertisers.
While search engines, e-mail, and website syndication capture
much of the attention of online retailers, affiliate marketing
carries a much lower profile. Still, affiliates continue to
play a significant role in e-retailers' marketing strategies.
History
The concept of revenue sharing—paying commission for
referred business—predates affiliate marketing and the
Internet. The translation of the revenue share principles
to mainstream e-commerce happened almost four years after
the origination of the World Wide Web in November 1994.
The
consensus of marketers and adult industry insiders is that
Cybererotica was either the first or among the early innovators
in affiliate marketing with a cost per click program.
During November
1994, CDNOW launched its BuyWeb program. With this program
CDNOW was the first non-adult website to introduce the concept
of an affiliate or associate program with its idea of click-through
purchasing. CDNOW had the idea that music-oriented websites
could review or list albums on their pages that their visitors
may be interested in purchasing. These websites could also
offer a link that would take the visitor directly to CDNOW
to purchase the albums. The idea for remote purchasing originally
arose because of conversations with music label Geffen Records
in the fall of 1994. The management at Geffen wanted to sell
its artists' CDs directly from its website, but did not want
to implement this capability itself. Geffen asked CDNOW if
it could design a program where CDNOW would handle the order
fulfillment. Geffen realized that CDNOW could link directly
from the artist on its website to Geffen's website, bypassing
the CDNOW home page and going directly to an artist's music
page.
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Amazon.com
(Amazon) launched its associate program in July 1996. Amazon
associates could place banner or text links on their site
for individual books, or link directly to the Amazon home
page.
When visitors
clicked from the associate's website through to Amazon and
purchased a book, the associate received a commission. Amazon
was not the first merchant to offer an affiliate program,
but its program was the first to become widely-known and serve
as a model for subsequent programs.
In February
2000, Amazon announced that it had been granted a patent (6,029,141)
on all the essential components of an affiliate program. The
patent application was submitted in June 1997, which predates
most affiliate programs, but not PC Flowers & Gifts.com
(October 1994), AutoWeb.com (October 1995), Kbkids.com/BrainPlay.com
(January 1996), EPage (April 1996), and several others. |
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