Question by Gregy: what is a “two-tier system” in affiliate marketing and in general?
I’ve stumbled upon this term in one of affiliate program manuals.
Best answer:
Answer by Ed Atun
You have to pay additional money to be moved up to Gold Status. That lets you do more things and make more money. That is the 2nd tier.
What do you think? Answer below!
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Affiliate System – How Does it Work?
Article by Herman L King
Online marketing strategies of products and services extensively use a combination of direct sales, auctions, and affiliate system. An affiliate system is a popular marketing strategy which involves four elements or actors. Firstly, it includes the merchant or the seller who wishes to enhance the sales of the products/services. Then there is a network of websites, blogs or e-mail marketing platforms that hosts the promotional contents relating to the same. The affiliate system also includes an affiliate, someone who joins this network and does the promotional activities.
Lastly and most importantly, the affiliate system includes the customer, who, by the affiliate is directed/redirected to an appropriate sales page or website and completes the purchase. Through the affiliate system:
- The buyer gets his desired item- The seller earns a profit through the sale- The affiliate earns a commission by acting somewhat as a sales agent in the process.
Why Affiliate System?
Affiliate marketing strategies or affiliate system is becoming increasingly popular with the expansion of e-commerce. Affiliate system is found to be more effective marketing method than direct sales since it involves less marketing overheads such as:
- A sales page or website which is much cheaper than a sales outlet.- A less expensive marketing agent or the affiliate who is paid a small promotional commission.- A cheaper advertisement or promotional activity such as PPC, SEO, PPM etc.- A larger and more prospective customer base than real world market.
Compensation Methods Involved in Affiliate System
Present trends in affiliate system include some or all of the following compensation methods:
- Pay-per-click (PPC): The affiliate hosts banner ads in his website/blog and draws the customers to click on the ads. For each click of the visitor, affiliate (or the publisher) gets paid. This affiliate system involves high risks since a visitor may ultimately end up doing nothing after the click.
- Pay-per-sales: This compensation method in the affiliate system requires the redirected visitor to be converted as a customer and complete a purchase.
- Search Engine Optimization: The affiliate or publisher displays SEO contents in websites where traffic is generated by search engine results.
- Cost-per-mille (CPM): In this method the affiliate system relies on a ‘thousand page/ad view’. The affiliate or publisher earns specific revenue by generating one thousand page views of the ad in the webpage. Thousand page views mean thousand visitors or a number of visitors viewing the ad for a thousand times. The affiliate system using this method has a high probability in converting visitors into customers.
Where to Start?
In contemporary trend of e-commerce, affiliate marketing is growing significantly. There are hundreds of programs in different affiliate systems where you can subscribe and earn affiliate commissions on a regular basis. For becoming a successful affiliate in these affiliate systems you need to:
- Understand how an they works.- Understand your own potential as a publisher against the merchant’s affiliate system requirements.- Understand different compensation methods and their earning potential in your affiliate program.- Be imaginative, innovative and persuasive.- Be patient and strive for continuous development in affiliate skills.- Know about “super affiliate’s” success stories shared in different affiliate forums.- Identify affiliate secrets from a host of affiliate publications, stories and trends.- Take an affiliate course or lesson if necessary before subscribing to a program.
Affiliate marketing is shaping today’s e-commerce much more than any other marketing strategies. Understanding the mechanism of affiliate system including tips, tricks and methods is essentially the first step you should take before getting into this diverse system. After gaining sufficient knowledge, you can ensure steady revenue earning which could even become your primary income
About the Author
Herman is a former professor and administrator, who have spent the past few years navigating the waters of affiliate marketing. To be guided on how to become a Super Affiliate, get more information from Secrets from Affiliate Marketers
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