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The Story Regarding Affiliate Networks
An affiliate network is essentially an intermediate between publishers and merchant affiliate programs. Affiliate networks help publishers or affiliates as they are usually recognized, to easily find out the affiliate programs that will generate more traffic and hence more income for their websites. It also allows the online merchants to promote their affiliate programs to all publishers who are participating in the affiliate networks. It is a mutually helpful scheme for publishers and internet merchants to gather at one place and reap in the benefits.
Affiliate networks are based mostly on the concept of revenue sharing that is, they let merchants offer a part of revenue generated to him from visitors to the publisher's site. There might be a fee for each visitor on the site that undertakes and performs a particular action like making a purchase, or for signing up and subscribing for a newsletter or a magazine. But generally revenue sharing is the common method as compared to or opposed to a fee-per-action model. Affiliate networks with many advertisers also attract a large group of the publishers. Big affiliate networks usually do not need to recruit publishers as the publishers already head to them on their own. Normally websites that attract the same kind of target audience as the advertisers but without any competition in them are typical affiliate network partners.
Affiliate networks have grown very quickly since their debut. Viewed as marketing toys in early days of internet, they have develop into an essential part of business plans of many organizations around the world. In fact they have been so successful that they have grown into bigger businesses than the present offline business. The total revenue amount generated according to one source by affiliate networks is £2.16 billion in UK alone for the year 2006. And In the same year for the USA the total bounty amounted close to US $ 6.5 billion.
Affiliate networks are primarily used in variety of sources like retail, gaming and gambling, personal finance, travel, education, telecom and also publishing. Typically the affiliates are allowed to join the network free of cost while there is mostly a nominal fee for the merchants to participate. The network also charges an initial setup or a membership fee which can be recurring. Although affiliates join free of charge, but they pay a particular percentage of their earnings as commission to affiliate network.
Affiliate networks are a huge conglomeration of publishers and merchants working towards a common goal; profit realization. Merchants derive benefits like tracking technology, payment processing, reporting tools and a large pool of publishers out of the affiliate network. However, affiliates derive services and benefits like affiliate programs, reporting tools and also payment aggregation using the network.
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