What is Affiliate Marketing?

Affiliate marketing pays outside partners a commission for every visitor, lead, or sale they send you.

How does affiliate marketing work?

Each partner gets a tracked link or code. Software credits the conversion, holds it through a return window, then pays a percentage of the sale or a flat fee per action. You can run the program in house or through a network that handles tracking, contracts, and payouts.

Why does affiliate marketing matter?

You pay after the result, so the cost of customer acquisition is capped by design. It buys distribution without headcount. The catch is credit: partners can claim sales you would have won anyway, so your attribution rules decide whether the channel actually makes money.

Where did affiliate marketing come from?

PC Flowers and Gifts ran the first commission program on Prodigy starting in 1989. Amazon Associates launched in July 1996, and its terms became the template the rest of the web copied.

How do you run affiliate marketing well?

Set commissions off contribution margin, not revenue. Write the attribution window and credit rules before you sign anyone. Ban bidding on your brand terms. Audit coupon sites and browser extensions that intercept checkout. Judge partners on repeat purchase rate, not raw volume.

Bottom line: Affiliate marketing is only cheap when your attribution rules are honest.

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