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The primary difference between the two is that affiliate marketers provide little if any influence on a possible prospect in the conversion process once that prospect is directed to the advertiser's website.
The sales team of the advertiser, however, does have the control and influence up to the point where the prospect either a signs the contract, or b completes the purchase.
Some advertisers offer multi-tier programs that distribute commission into a hierarchical referral network of sign-ups and sub-partners. 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 publishers "B" and "C" to sign up for the same program using his sign-up code, all future activities performed by publishers "B" and "C" will result in additional commission at a lower rate for publisher "A".
Two-tier programs exist in the minority of affiliate programs; most are simply one-tier. Referral programs beyond two-tier resemble multi-level marketing MLM or network marketing but are different: Merchants favor affiliate marketing because in most cases it uses a "pay for performance" model, meaning that the merchant does not incur a marketing expense unless results are accrued excluding any initial setup cost.
Some merchants run their own in-house affiliate programs using dedicated software, while others use third-party intermediaries to track traffic or sales that are referred from affiliates.
There are two different types of affiliate management methods used by merchants: Payouts to affiliates or publishers can be made by the networks on behalf of the merchant, by the network, consolidated across all merchants where the publisher has a relationship with and earned commissions or directly by the merchant itself.
Uncontrolled affiliate programs aid rogue affiliates, who use spamming ,  trademark infringement , false advertising , cookie stuffing , typosquatting ,  and other unethical methods that have given affiliate marketing a negative reputation.
Some merchants are using outsourced affiliate program management OPM companies, which are themselves often run by affiliate managers and network program managers.
Affiliate websites are often categorized by merchants advertisers and affiliate networks. There are currently no industry-wide standards for the categorization.
The following types of websites are generic, yet are commonly understood and used by affiliate marketers. Affiliate networks that already have several advertisers typically also have a large pool of publishers.
These publishers could be potentially recruited, and there is also an increased chance that publishers in the network apply to the program on their own, without the need for recruitment efforts by the advertiser.
Relevant websites that attract the same target audiences as the advertiser but without competing with it are potential affiliate partners as well.
Vendors or existing customers can also become recruits if doing so makes sense and does not violate any laws or regulations such as with pyramid schemes.
Almost any website could be recruited as an affiliate publisher, but high traffic websites are more likely interested in for their sake low-risk cost per mille or medium-risk cost per click deals rather than higher-risk cost per action or revenue share deals.
If the above locations do not yield information pertaining to affiliates, it may be the case that there exists a non-public affiliate program.
Utilizing one of the common website correlation methods may provide clues about the affiliate network.
The most definitive method for finding this information is to contact the website owner directly if a contact method can be located. Since the emergence of affiliate marketing, there has been little control over affiliate activity.
Unscrupulous affiliates have used spam , false advertising , forced clicks to get tracking cookies set on users' computers , adware , and other methods to drive traffic to their sponsors.
Although many affiliate programs have terms of service that contain rules against spam , this marketing method has historically proven to attract abuse from spammers.
In the infancy of affiliate marketing, many Internet users held negative opinions due to the tendency of affiliates to use spam to promote the programs in which they were enrolled.
A browser extension is a plug-in that extends the functionality of a web browser. Most modern web browsers have a whole slew of third-party extensions available for download.
In recent years, there has been a constant rise in the number of malicious browser extensions flooding the web.
Malicious browser extensions will often appear to be legitimate as they seem to originate from vendor websites and come with glowing customer reviews.
Typically, users are completely unaware this is happening other than their browser performance slowing down. Websites end up paying for fake traffic number, and users are unwitting participants in these ad schemes.
As search engines have become more prominent, some affiliate marketers have shifted from sending e-mail spam to creating automatically generated web pages that often contain product data feeds provided by merchants.
The goal of such web pages is to manipulate the relevancy or prominence of resources indexed by a search engine, also known as spamdexing. Each page can be targeted to a different niche market through the use of specific keywords, with the result being a skewed form of search engine optimization.
Spam is the biggest threat to organic search engines, whose goal is to provide quality search results for keywords or phrases entered by their users.
Google 's PageRank algorithm update "BigDaddy" in February —the final stage of Google's major update "Jagger" that began in mid-summer —specifically targeted spamdexing with great success.
This update thus enabled Google to remove a large amount of mostly computer-generated duplicate content from its index.
Websites consisting mostly of affiliate links have previously held a negative reputation for underdelivering quality content.
In there were active changes made by Google, where certain websites were labeled as "thin affiliates".
To avoid this categorization, affiliate marketer webmasters must create quality content on their websites that distinguishes their work from the work of spammers or banner farms, which only contain links leading to merchant sites.
Some commentators originally suggested that affiliate links work best in the context of the information contained within the website itself.
For instance, if a website contains information pertaining to publishing a website, an affiliate link leading to a merchant's internet service provider ISP within that website's content would be appropriate.
If a website contains information pertaining to sports, an affiliate link leading to a sporting goods website may work well within the context of the articles and information about sports.
The goal, in this case, is to publish quality information on the website and provide context-oriented links to related merchant's websites.
However, more recent examples exist of "thin" affiliate sites that are using the affiliate marketing model to create value for Consumers by offering them a service.
These thin content service Affiliates fall into three categories:. The implementation of affiliate marketing on the internet relies heavily on various techniques built into the design of many web-pages and websites, and the use of calls to external domains to track user actions click tracking, Ad Sense and to serve up content advertising to the user.
Most of this activity adds time [ citation needed ] and is generally a nuisance to the casual web-surfer and is seen as visual clutter.
The use of specific entries in the HOSTS file to block these well-known and persistent marketing and click-tracking domains can also aid in reducing a system's exposure to malware by preventing the content of infected advertising or tracking servers to reach a user's web-browser.
Although it differs from spyware , adware often uses the same methods and technologies. Merchants initially were uninformed about adware, what impact it had, and how it could damage their brands.
Affiliate marketers became aware of the issue much more quickly, especially because they noticed that adware often overwrites tracking cookies, thus resulting in a decline of commissions.
Affiliates not employing adware felt that it was stealing commission from them. Affiliates discussed the issues in Internet forums and began to organize their efforts.
They believed that the best way to address the problem was to discourage merchants from advertising via adware. Merchants that were either indifferent to or supportive of adware were exposed by affiliates, thus damaging those merchants' reputations and tarnishing their affiliate marketing efforts.
Many affiliates either terminated the use of such merchants or switched to a competitor's affiliate program. Eventually, affiliate networks were also forced by merchants and affiliates to take a stand and ban certain adware publishers from their network.
Affiliates were among the earliest adopters of pay per click advertising when the first pay-per-click search engines emerged during the end of the s.
Later in Google launched its pay per click service, Google AdWords , which is responsible for the widespread use and acceptance of pay per click as an advertising channel.
An increasing number of merchants engaged in pay per click advertising, either directly or via a search marketing agency, and realized that this space was already occupied by their affiliates.
Although this situation alone created advertising channel conflicts and debates between advertisers and affiliates, the largest issue concerned affiliates bidding on advertisers names, brands, and trademarks.
Some advertisers, however, did and still do embrace this behavior, going so far as to allow, or even encourage, affiliates to bid on any term, including the advertiser's trademarks.
Bloggers and other publishers may not be aware of disclosure guidelines set forth by the FTC. Guidelines affect celebrity endorsements, advertising language, and blogger compensation.
Affiliate marketing currently lacks industry standards for training and certification. There are some training courses and seminars that result in certifications; however, the acceptance of such certifications is mostly due to the reputation of the individual or company issuing the certification.
Affiliate marketing is not commonly taught in universities, and only a few college instructors work with Internet marketers to introduce the subject to students majoring in marketing.
Education occurs most often in "real life" by becoming involved and learning the details as time progresses. Although there are several books on the topic, some so-called "how-to" or " silver bullet " books instruct readers to manipulate holes in the Google algorithm , which can quickly become out of date,  or suggest strategies no longer endorsed or permitted by advertisers.
Outsourced Program Management companies typically combine formal and informal training, providing much of their training through group collaboration and brainstorming.
Such companies also try to send each marketing employee to the industry conference of their choice. Other training resources used include online forums, weblogs, podcasts , video seminars, and specialty websites.
Members of the marketing industry are recommending that "affiliate marketing" be substituted with an alternative name.
Performance marketing is a common alternative, but other recommendations have been made as well. In April the State of New York inserted an item in the state budget asserting sales tax jurisdiction over Amazon.
Amazon challenged the amendment and lost at the trial level in January The case is currently making its way through the New York appeals courts.
Cookie stuffing involves placing an affiliate tracking cookie on a website visitor's computer without their knowledge, which will then generate revenue for the person doing the cookie stuffing.
This not only generates fraudulent affiliate sales but also has the potential to overwrite other affiliates' cookies, essentially stealing their legitimately earned commissions.
Many voucher code web sites use a click-to-reveal format, which requires the web site user to click to reveal the voucher code.
The action of clicking places the cookie on the website visitor's computer. In the United Kingdom, the IAB Affiliate Council under chair Matt Bailey announced regulations  that stated that "Affiliates must not use a mechanism whereby users are encouraged to click to interact with content where it is unclear or confusing what the outcome will be.