The Definition of Affiliate Marketing

Affiliate marketing is when one business pays another for generating traffic, leads, or sales. On the Internet, the affiliate sites host banner ads, text links, and graphics that entice visitors to click on them and visit the sponsor site. The sponsor site keeps track of how many visitors come from each affiliate site and what they do when they get there.

Payment can be made based on clicks, sign-ups, or registrations for newsletters, opening accounts, purchases (or anycombination of these things). The merchant site generally provides the graphics, offers special discounts or coupons, and does what they can to support their affiliate sites. Performance is measured automatically (typically through the use of cookies that are installed on visitor's sites). Payment is typically made once a month once a certain dollar amount has been earned.