This document provides an overview of affiliate marketing. It discusses how affiliate marketing works as a pay-for-performance model where affiliates are paid a commission only when they drive a sale or desired action for the merchant. It also outlines some of the key benefits of affiliate marketing programs such as being a win-win model for merchants and affiliates, providing predictable returns, and allowing merchants to outsource marketing efforts. However, the document also notes some potential problems such as loose control over how affiliates promote products and possibility of click or lead fraud.

1. Affiliate MarketingRef: CHAP 6 Online Marketing Inside Out by SitePoint > Individual Media Plan presentations > Affiliate Marketing – Detailed Overview > Term Project Discussion Class Presentation | Session 14 | 1 Oct 2010

2. Affiliate Marketing Ref: Chap 7 – Online Marketing Inside Out by Sitepoint Concept of Affiliate Marketing Pay only for Sales Win-win model Have been used effectively particularly in E-businesses NOT for Everyone: Dynamics to be understood carefully In recent years, concept of partnership/partner programs is used by different E-businesses. It is almost same as conventional Affiliate marketing program E-Marketing 2

3. Affiliate Marketing Concept of Affiliate Marketing Most mature option in Online Advertising/Marketing in terms of payment models Pyramid model to explaingraduation from clicksto sales Pyramid represents decrease in number ofimp-clicks-leads-sales E-Marketing 3

4. Affiliate Marketing Concept of Affiliate Marketing Contract with third-parties to: Promote your product/website/business Send traffic to their website Get paid when there is some successful action Successful action can be: Sales (actual purchase of product) Filling of form (getting registered) OR any other action required by business Generally action is at a more mature stage than click E-Marketing 4

5. Affiliate Marketing Key features of Affiliate Marketing Automated process The whole process of Affiliate Marketing in Online world is automated or should be as automated as possible Give a link/banner to affiliates. They place it on their website. Traffic coming by clicking on banners will be tracked for entire activity Mainly cookies are used for tracking Marketing to Affiliates To acquire more affiliates, marketing has to be done separately to them Approving affiliates may be required to ensure that quality sites promote your business only E-Marketing 5

6. Affiliate Marketing Benefits of Affiliate Marketing Win-Win Pay only when there is sale No other obligations It may be slightly tailored to make it more attractive Fixed ROI With known payments / sale, ROI is predictable Extended Reach More and more affiliates can be added without any cost (except marketing to affiliates) Cover more geography even Outsource Marketing – Focus on core business Affiliate marketing is like outsourcing marketing Traffic will be ‘automatically’ coming E-Marketing 6

7. Affiliate Marketing Problems of Affiliate Marketing Loose control on Marketing Program Affiliates can engage in any form of communication with prospective customer and may jeopardize brand Control is very hard to maintain on affiliates as to how they promote it Doubling up of Leads Some leads coming through affiliates might be your customers otherwise Now, you have to pay even for generic traffic Click frauds Affiliate may be involved in click fraud or other fraudulent transactions to increase their commissions Hard to do in Sales based activity but relatively easier in other forms Affiliates may be hard to acquire It is more attractive for businesses than for affiliates More and more businesses offering affiliate programs makes it competitive E-Marketing 7

8. Email Marketing Ref: CHAP 6 Online Marketing Inside Out by SitePointAddl. Rdg.: CHAP 2 Textbook on E-Marketing by Quirk Biz > Fundamental concepts in Email Marketing > Different Types of Email Communication > Concept of Permission > Building up Email Lists > Comprehensive Quiz on Online Advertising Class Presentation | Session 15 | 5 Oct 2010