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About affiliate marketing:
Cost per mille (thousand) (CPM/CPT) requires the publisher only to load the advertising on his website and show it to his visitors in order to get paid a commission, while PPC requires one additional step in the conversion process to generate revenue for the publisher. Visitors must not only made aware of the ad, but also pursue them to click on it and visit the advertiser's website. Cost per click (CPC/PPC) used to be more common in the early days of affiliate marketing, but diminished over time due to click fraud issues that are very similar to the click fraud issues modern search engines are facing today. Contextual advertising, such as Google AdSense are not considered in this statistic. It is not specified yet, if contextual advertising can be considered affiliate marketing or not.
CPM/CPC versus CPA/CPS (performance marketing)
Internet marketing affiliate program internet based business in practical terms:
publisher "A" signs up to the program with an advertiser and gets rewarded for the agreed activity conducted by a referred visitor. If publisher "A" attracts other publishers ("B", "C", etc.) to sign up for the same program using her sign-up code all future activities by the joining publishers "B" and "C" will result in additional, lower commission for publisher "A". Snowballing, this system rewards a chain of hierarchical publishers who may or may not know of each others' existence, yet generate income for the higher level signup. This sort of structure has been successfully implemented by a company called Quixtar.com, a division of Alticor, the parent company of Amway. Quixtar has implemented a network marketing structure to implement its marketing program for major corporations such as Barnes & Noble, Office Depot, Sony Music and hundreds more. Two-tier programs exist in the minority of affiliate programs; most are simply one-tier. Referral programs beyond 2-tier are multi-level marketing (MLM) or network marketing.
Even though Quixtar compensation plan is network marketing & wouldn't be
considered 'affiliate marketing', the big company partners are considered and call
themselves affiliates. Therefore, you may argue that the Quixtar company is the affiliate
marketer for its partner corporation. |
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