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Table of Contents Expand. What Is Affiliate Marketing? Understanding Affiliate Marketing. Types of Affiliate Marketing. Affiliate Marketing Pros and Cons. Examples of Affiliate Marketing. Frequently Asked Questions. Key Takeaways Affiliate marketing is a marketing scheme in which a company compensates partners for business created from the affiliate's marketing tactics.

Digital marketing, analytics, and cookies have made affiliate marketing a billion-dollar industry. Firms typically pay affiliates per sale and less frequently by clicks or impressions. The three main types of affiliate marketing are unattached affiliate marketing, involved affiliate marketing, and related affiliate marketing. Pros Access to a broader market Better accounting of qualified leads Low-cost advertising. Cons Subject to fraud Less creative control Vulnerable to theft.

Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.

Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace. Related Terms Digital Marketing Digital marketing is the use of the internet, mobile devices, social media, search engines, display advertising, and other channels to reach consumers.

Affiliates: Everything You Need to Know The term affiliate is used to describe the relationship between two entities wherein one company owns less than a majority stake in the other's stock. Reading Into Affiliate Networks An affiliate network is a group of companies that sometimes offer compatible or complementary products and will often pass leads to each other. Affiliate Fraud Affiliate fraud is false or unscrupulous activity conducted to generate commissions from an affiliate marketing program.

Micromarketing: Advertising Focused on a Specific Group of Customers Micromarketing is an approach to advertising that tends to target a specific group of people in a niche market.

With micromarketing, products or services are marketed directly to a targeted group of customers. Cost per click is an online advertising revenue model by which publishers charge advertisers each time a user clicks on a display ad. Partner Links. Related Articles. Lifestyle Advice eBay vs. Amazon: What's the Difference? Personal Finance What can you actually buy with bitcoin? Investopedia is part of the Dotdash publishing family. Your Privacy Rights.



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