Affiliate Marketing, another marriage of marketing and technology.

I was in IT for about 7 years before I realized my love of IT was more a respect for the technology that brought such a level of creativity to communication. My real love is internet marketing, and although it is not so technically challenging as application development, you really need to be able to grasp new technologies to be able to market them properly. Otherwise, there’s an added learning curve every time a new marketing technology comes bounding along.

A good example of this marriage of technology and creativity is Affiliate Marketing, which by the way, I always type as “affilaite” before my spell checker fixes it. I know how to spell it, but my hands go another direction. Ok, back to the point. In affiliate marketing, there is an entire technology process that supports it, which affiliates and advertisers must be aware of. It is not rocket science, but I know from experience dealing with so many new online marketers, that it is sometimes an obstacle for them to get past before they can start to apply it.

Let’s clarify what affiliate marketing is first. There are usually 2 parties, an advertiser and an affiliate, also known as a publisher. The advertiser has a product they need to sell. An affiliate is a webmaster, publisher, e-mailer, anyone who can distribute information on the net to either their readers or new audiences. Affiliates want to use their distribution to sell the advertiser’s products and make commission off of it.

Now, on to the technical stuff; as an advertiser or seller of the product, you need to be able to insert a pixel, which is an invisible image file, into the html code of the confirmation page in your order process. This allows the tracking of sales. We’ll get back to this later.

As an affiliate, you need to understand how to create html pages and insert the code which corresponds to the offers you are promoting for your advertisers. Whether you promote via emails, newsletters, blogs or entire websites, you still need some understanding of inserting code and possibly modifying it to be able to better track it.

Now onto the tracking; why do advertisers need to use pixels and affiliates need to insert code? Very simply, this is the technology that enables you to track your clicks and sales. Otherwise, how else would you know how much you get paid? It goes something like this….

Let’s say the advertiser is Booksellers and the publisher is JoeBookLover. Joe has a website where he talks about his favorite books and he signed up as an affiliate of Booksellers, so that he can make a commission from the books he promotes when his readers buy them. So Joe signs up as an affiliate by filling out a form with some details about his website, payment info and promotional methods, and he’s approved!

Next, Joe logs into his affiliate menu on Booksellers and he chooses Gone With the Wind as a book to sell. He can choose different sized banners, text links, or rich media to promote the book on his site. These are all called creatives. When Joe chooses the creative he wants to place on his website, a banner, Booksellers then gives him some code to copy and paste into his html page. This code does three things. It displays an image of the banner Joe chose, it links to the product, Gone With the Wind, so the visitor can purchase it and it tracks the fact that the buyer came from Joe’s site. Those are quite a few features!

Technically, what happens is the following:
1. A visitor reads Joe’s Gone With the Wind page and decides to purchase the book by clicking the banner on the page.
2. When the visitor clicks the banner, he/she lands on Booksellers’ product page.
3. The code in Joe’s page sends an ID number to Booksellers along with the user.
4. When the user finishes his/her transaction, a confirmation page appears thanking the user for the purchase.
5. That confirmation page holds a pixel that then receives the ID number from Joe’s tracking that tells Booksellers the purchase was from Joe’s site.
6. When Joe logs into his affiliate menu again, that transaction will show up with the amount of he sale and his commission from that purchase.

Voila, that is affiliate marketing; a beautiful combination of creative marketing techniques, such as using affiliates as your commission-based sales force, and technology, the ability to offer creative and track the entire process.