Affiliate Marketing is classified into many types. All types fall below two fundamental categories. They are pay/click and pay/performance.
 
Pay/Click

It is also called PPC. It’s considered to become the simplest and most popular affiliate marketing method. This is the greatest point for small websites.  With this technique the affiliate marketer places the banners and text advertisements of retailers on his website. The affiliate is paid for every click created on these banners. When any visitor clicks on these banners and visits the merchant web site, the affiliate will get credited. It is not important that the visitor makes a purchase. However, the standard earning for just one click is really little, usually much less than 1 dollar.

Pay/Performance

Pay/performance affiliate marketing, also known as PPC, is extremely well-known among big affiliates and all kinds of merchants. In this method the affiliate will get credited only when any visitor from their affiliate id performs the required action. This needed action may be a buy or turning out to be a member of the merchant website. This method is very great for that retailers simply because they’ll only pay when they’re paid. For affiliates, it is appealing because they’re obtaining a great reveal within the sales of vendor products. The typical reveal is about 15-20% of sale.

If we classify the affiliate marketing about the basis of depth, then it can be divided into 3 classes. They are single-, two-tier and multi-tier programs. Another kind is the 1 by which an affiliate marketer is paid for every sale that’s created by a individual referred by him. This really is called residual income affiliate marketing. Let us study these types in detail.
 
Affiliate Marketing: 1-Tier, 2-Tier & Multi-Tier

In an affiliate program of single-tier nature, the affiliates get the commission, only, for the visitor’s traffic or sales to the merchant’s website. Pay/performance and pay/click fall under this category.

Talking about Two-tier marketing, the affiliate gets the commission for every action done by the visitors referred by him. Plus he will get the profit whenever some other affiliate, referred by him, will get the commission. So in this way affiliate is earning directly as well as indirectly.

The multi-tier marketing is the same as two-tier marketing. But in this kind, the affiliates get the commission for that sales made by their affiliated affiliates in multiple tiers. The depth of this kind might be unlimited.

Residual Income Marketing

In this kind of marketing, affiliates get the commission for each and every sale that his referred individual can make about the vendor website. The only requirement is that about the first time visit, the person should come from the affiliate link of the affiliate. Next time if the same person visits the merchant website, even without using the affiliate link, the affiliate will be paid for every sale created by the visitor. The question that arises is how the merchant will know the affiliate id. The answer is really simple. On the first visit of the person from the affiliate website, a cookie is developed about the computer of the visitor. This cookie stores the affiliate id of the affiliate. This cookie usually expires after 3 months. In some cases it might be longer.  Whenever a visitor visits the vendor web site, the visitor’s computer is checked for the existence of any previously created cookie. If the cookie is found, the affiliate id is retrieved from it and the affiliate gets credited for any buy created by the visitor.

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