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An Introduction to the Different Types of Affiliate Programs

Today, affiliate marketing programs is seen as one of the most important methods by online companies and merchants to market their products and services because implementing an affiliate program doesn't cost much money and it helps generate a consistent stream of online profit.

On the other hand, the affiliates see affiliate marketing as a feasible and low cost method to make online online by promoting other people products using a website or without a website (using Google AdWords PPC advertising program).

There are many affiliate programs on the Internet and not all of them are similar. The most basic affiliate programs fall into 3 categories:

  • Pay Per Performance
  • Pay Per click
  • Residual Income Affiliate Marketing Programs
Pay Per Performance
Pay per performance (PPP) affiliate programs are what most companies and online merchants likes to use. The companies only need to pay when an affiliate referral translates into an action. The action can be a purchase or a lead. The affiliates will spend their own money to promote the affiliated company's products, This save a lot of money for the company. PPP affiliate programs can be futher classified into 2 sub-categories:
  • Pay Per Sale (PPS) The title says it all. The company only pays the affiliate when a visitor referred by the affiliate make a purchase.
  • Pay Per Lead (PPL) PPL is a little different to PPS. PPL affiliate programs usually used by finance and insurance companies. In this type of affiliate marketing, the affiliate will be paid a fixed commission whenever a visitor referred by him/her to the merchant's website requested a quote or filled up an online application form.
Pay Per Click (PPC) Affiliate Programs
PPC affiliate programs are most popular. You should have heard them a lot. PPC programs are probably the easiest way for web publishers to make money from their websites and blogs. The affiliate gets paid a certain amount ($0.05 to $0.50 usually) whenever a visitor click a banner or text ad displaying on the affiliate's website. PPC typically used by contextual advertising companies like Google AdSense, Yahoo Publisher Networks and much more.

Residual Income Affiliate Marketing Programs
In this type of programs, the affiliate not only compensated for every customer referred to the merchant's website, the affiliate is also paid whenever the referred customer returns to the site and buy another product.

The different types of affiliate marketing programs would deffinitely work differently for merchants and affiliates, and each would have their own advantages and drawbacks. To find out which types of programs work best for you, you'll have to know which one of them suit your need and characteristic most. And then start testing them.
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