Starting an Online Business All-in-One For Dummies®, 3rd Edition

Establishing an Affiliate Advertising Program

One of the most effective ways to take advantage of online advertising to enhance your income online is to set up an affiliate program. An affiliate agreement enables other sites to refer traffic to your Web site, usually in exchange for a small commission on each sale that originates from its referral traffic. You can set up an affiliate program that's based on one of these methods:

• Pay per click: You pay each time a link to your site or product is clicked.
• Pay by lead: You pay whenever a referred customer completes an online form, for example.
• Pay by flat rate: You pay a set fee as opposed to a percentage of each sale.

You might be interested in becoming an affiliate for others as a way to earn revenue, too. In Book IV, Chapter 2, we show you how to start adding existing affiliate programs to your Web site.

A big benefit of establishing your own affiliate arrangement is that you maintain control over how your product is distributed to your customers. You're still the one handling and shipping the product, even though both you and your affiliate are likely to have contact with the customer. Another inherent benefit is that affiliate programs serve as a cost-effective marketing tool for building awareness about your product or Web site.

Setting up an affiliate program isn't complicated, although you're responsible for keeping up with some critical functions:

• Create and review affiliate guidelines. You establish your terms and conditions ...