Affiliate marketing is a business strategy in which an affiliate or a business agent is rewarded for every customer or visitor that is welcomed in by the affiliates efforts.
Origin of Affiliate Strategy
Before the advent of the Internet, many organizations practiced the payment of commission for any business referral. Four years after the World Wide Web started in 1994 this revenue sharing with the affiliated penetrated e-businesses. Cyberrootica was the first innovator for affiliate marketing where the affiliate received revenue for every click on the program.
Next CDNOW started the concept of clicking and purchasing to go one more step towards this type of marketing. They published lists of music albums and also offered links which would take the interested customer to CDNOW to purchase the albums.
This idea originated with Geffen Records in 1994 where they wanted an affiliate to sell the CD's. They asked CDNOW to act as their agent. The customer would click on the artist or album on the CDNOW website and would be directed to Geffen's website.
The Next Major Step
The next step was made by Amazon.com where the Amazon affiliates gave links on their site leading directly to the Amazon home page. When any customer came through the affiliates link and bought any book, the affiliate received a commission.
Although Amazon was not the first to launch Affiliate marketing they were the most popular model. Amazon further acquitted patents for the specifications of an affiliate program. Others having this patent are PC Flowers & Gifts.com, AutoWeb.com, EPage, and many others.
History of Affiliate Marketing Development
Affiliate marketing has grown stupendously since its modest beginnings. The total amount of sales through in 2006 was 2.16 billion pounds in UK. Through the world affiliates have earned $ 6.5 billion worldwide in the form of missions and gifts.
This amount was gained through selling a variety of products covering a whole range such as education, telecom, travel, games, gambling, and finance and so on. The affiliate marketing became a source for generating leads as well as programs for giving context related advertising.
Affiliate marketing today is most popular in the fields of gambling, adult, and retail sectors. It is projected that finance, travel, and mobile phone sectors will receive a boom expansion. Entertainment and services relating to the internet such as broadband sectors will follow closely. It is also predicted that marketers as well as advertisers will use this tool extensively.
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Source by Naga Nandini