You may have heard of webmasters who have turned their websites into "cash cows". You may also have heard these same people talk about the affiliate programs they've enlisted in, and how joining these affiliate programs was one of the best money-making decisions they'd ever made.

So what is an Affiliate Program? How does one of these programs work? And how can you get in on the action?

An Affiliate Program is a referral marketing strategy, which is often revenue-sharing, whereby a merchant website increases its' traffic and/or sales by paying a commission to referring websites. The commission is normally paid after the referred site visitor makes an action, such as signing up or making a purchase on the merchant's site.


How Does An Affiliate Program Work?

As the diagram below illustrates, there are three entities involved in typical affiliate program: the Merchant, the Affiliate and the Customer.

For example, if you join an Affiliate Program, you will be paid a referral fee for each visitor who (1) is directed to the merchant website through a link on your website and (2) who subsequently makes the required action on this merchant website. In this scenario you would be referred to as the affiliate, and the website hosting the affiliate program is referred to as the merchant.

Affiliates have quickly become veritable sales forces for merchant websites. As in a typical sales force, the affiliate sites receive their income from a pre-determined referral fee or commission rate that is based on a measurable action by the site visitor. This measurable action could be clicks, leads, an outright sale or any other action a merchant would like to reward.


How Can You Become An Affiliate?

It's simple. Visit a merchant or an affiliate network website and fill out the online application. Next, install the provided banner or text link onto your site and hook this up to the unique tracking link provided by the merchant.

The tracking link includes a unique identifying code that allows the merchant to correctly track the actions the referred customer makes on the merchant website.

The banner/text link represents a visual packaging of the merchant site. This is the equivalent of a merchant's storefront window in the affiliate's site. It also becomes the point of transfer from the affiliate site to the merchant site.

Signup now and start earning big bucks.