Affiliate Marketing definition

Affiliate marketing is performance-based marketing in which a business rewards one affiliate for each successful purchase from a customer brought by the affiliate's own marketing efforts.
There are three sides of an actual affiliate equation: Product seller (merchant) and Affiliate and Customer. Both merchants and affiliates benefit from the idea of sharing revenue. Merchant offers affiliate a win-win relationship when the merchant can increase sales while affiliate get a reward in form of commission.



The merchant: Sometimes known as the seller, creator, vendor or retailer,... they are the ones who create the product. From a solo entrepreneur to a big brand, anyone could be the merchant in the affiliate model. The purpose of merchants when joining Affiliate marketing model is to advertise their product to customers in order to increase revenue.

Affiliate: Also known as Publisher, Influencer. Affiliate can range from a single person to an enterprise, from a professional affiliate, a social media influencer to a customer who makes a purchase on the merchant website. Affiliate's main role is to attract and convince potential customers of the value of the merchant's product.
There are various ways in many channels that affiliate can promote merchant's website such as running ads on Facebook, sharing posts on Social media, embed links on their website, running an email marketing campaign or seeding on suitable forums,...

Customer: Customers are the key to every business, their activity decides the success of a business. Thanks to affiliate promotion activities, potential customers can approach the merchant's product easier. The order made by the customer through an affiliate's marketing action will become a referral order, which is the base to calculate the affiliate commission.

Updated on: 23/06/2020