There are basically three different
types of affiliate programs:
Pay-per-click - You pay your affiliates money for every
visitor that they send you. This is typically pennies per click.
Be very careful
with this method due to the fact that it is very easy to cheat you.
There are quite a few 'hacker' programs that have been designed to
over-inflate the number of click-thrus to sites. You can end up spending
your entire advertising budget on false clicks.
Pay-per-lead - You pay your affiliates based on the number of
actual leads that you get from their site. This will usually be based on
the number of sign-in forms that are filled out by visitors originating
from their site, or number of email addresses that signup for your
newsletter. This method typically pays from $1 to several dollars per
lead. You are then able to follow up on those leads to try and make a
sale.
Pay-per-sale - This is the preferred method, especially if you
have your own product to sell. This form of affiliate program only pays
if a visitor from one of your affiliate sites actually purchases
your product. This method typically pays a percentage of the sale, and
can pay as high as 60% of the purchase price. The nice thing
about this method is that you only pay when you actually get a sale! If
a particular affiliate sends you 1000 visitors, but only one of those
visitors actually buys your product, you only pay for that one sale.
