by Alastair Harris

Created on: February 19, 2007   Last Updated: March 15, 2007

What is Affiliate Marketing? Why is the internet a buzz about Affiliate Marketing? And why to dot com millionaires always seemed to be involved in some sort of Affiliate Marketing?

If you plan to build an internet business or internet empire without a doubt affiliate marketing is something you need to become involved with.

So let's answer the first question, What is Affiliate Marketing? Affiliate Marketing is selling on behalf of someone else in return for a percentage of the sale. You stock no product, don't need to package or handle, nor do you have the normal business overheads. What you do need with Affiliate Marketing is web presence. The internet is now so huge - 8 Billion pages and growing - that the chance of someone stumbling on your site is low to nil without doing some tricks of the trade. (see my article or website on generate traffic and create hits) for further on that topic.

The simple fact of the matter is you will not get sales if you don't get traffic. Think of it this way - an affiliate product is sold by advertising, therefore what will generate more sales? One ad or thousands of ads? That's pretty easy, the more ads, the more traffic, the greater the number of sales. Understand that the conversion rate on the internet is low. A conversion rate is the number of views before a potential sale. Normally this hovers around 1%. It tends not to matter what you are selling this rate tends to remain the same, your offer could be the very best on the net but still the conversion rate tends to be 1% - or one in hundred visitors will buy and make you money. Anyone with a conversion rate of 3% would be considered to be doing amazingly well and most people can not achieve this kind of result. Compare this with the conversion rate of people visiting the local shopping center, apart those teenagers who just love to 'hang', most people going to the shops buy at least something.

Obviously the internet is a different kind of market. People are in the comfort of their own homes. The psychology of the sale is very different. Whereas people going to the shops are buying necessities like the weekly groceries, online people are tending to buy luxuries. The spur of the moment sale is less demanding as well, because people can bookmark and know they can come back later - they can delay the purchase decision with no fear of losing their chance to purchase. Some internet marketers have tried to overcome this by saying only 50 left, only 33 left, etc, having a count down.

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