In modern digital marketing, the concept of affiliate marketing is nothing new. Basically, it is the work of a salesman. But it is done through digital mediums, and the pay is much better than a typical salesman. But how does an affiliate marketing payment system work? The affiliate payment policy could be a little tricky to understand. But in this article we will try to accomplish that task with as much simplicity as we can.

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  1. The basic concept of affiliate marketing and network

Affiliate marketing is a commission-based service that a person or a group of persons provide. Usually, there is a producer or company. The company has the products that they need to sell. But reaching the customer and convincing them to buy the product is not an easy job. That takes skills and other manipulating methods. So the company then hires affiliates who promote their product. The role of the affiliate is to sell as much product as they can or drive the customer towards the company in order to increase sale. The affiliate gets commissioned pay by the company per transaction or the revenue earned. This is affiliate marketing in a nutshell. The affiliate network works between the affiliate merchant and the website publishers.

  1. Classification of the payment system

There are various types of affiliate payments available in the affiliate network. But the main four of them are- PPC (pay per click), PPL (pay per leads), PPS (pay per sales), and again, PPC (pay per calls). To avoid fraud, you should stay away from pay per click if you can. Because this type of payment includes a considerable risk factor that could lose you money big time. Because this type of fraud is mostly untraceable. The other methods are relatively safe considering the risk factors and the revenue gain.

  1. Why affiliate networking?

Affiliate networking is a business that has a little start-up cost. The business can run with very little resources. You don’t have to think about the production. That is the job of the merchant. He produces the product. You are the intermediary between companies and a large number of audiences. The affiliate network will promote the product to all the publishers of the websites. They will then advertise using their own means to gain sales or views for the concerned company. This is a fast way of making money with just using your brain to manage the business and keeping up the sales.

  1. Payment per clicks

In this method, the publisher gets paid by the number of clicks he produces through the advertisement he provides. But this kind of payment is highly discouraged because the publisher could produce fake clicks and claim money. But that would not benefit the company at all because the clicks would not bring any sale or revenue for the company. So it is better to not to use this kind of payment system.

  1. Payment per leads

In this system, the publisher gets paid by the lead of a potential customer. In other words, the company receives the contact information of the interested consumer. The publisher would get paid by the lead count.

  1. Pay per calls

Service-based businesses are mostly benefitted by this kind of affiliation. The publisher gets paid by the number of calls he can produce for the organization. It is a good deal for services like law firms.

  1. Pay per sale

This method is by far the safest and most convenient for the merchant. The publisher gets paid by the number of sales he could make for the company. It is as simple as that. Sell my product and get your revenue share. That’s it. The merchant is benefitted the most from this kind of payment. Because the ultimate goal of the merchant is to sell his product. This gets the job done directly.

  1. Affiliate Network’s role

So, what does the affiliate network do then you might ask. The merchant is busy producing and improving the product of their brand. The affiliate network manages the publishers and their payment for their service. That way, the merchant does not have to bother dealing with each individual publisher. The network can do that.

  1. Payment of affiliate network

The affiliate network’s payment is not very tricky. He collects the due money from the merchant or the company he is working for. Then he pays out the publisher’s due. And he gets his cut of the revenue for managing and earing the customers and sales. That’s the method of payment for the affiliate networking personnel.

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  1. Policies regarding the payment

There are various modes of payment involved in affiliate networking. Such as net-30, net-7, cookie life, locking period, etc. These modes ensure that the company is getting the sales they need, and the payment is being made rightly. Net-7 means that the publisher gets his cut seven days after the invoice date. Net-30 is the same thing with the day count being thirty.

  1. Invoicing interval

The affiliate network can invoice the publisher monthly, bi-monthly, or weekly. The contract between the concerned parties decides this and produces the invoice accordingly.

  1. Referral bonus

Referral bonus is a special kind of payment made to the publisher to gain other publishers. This could benefit both the merchant and the affiliate network.

Affiliate marketing is part and parcel of today’s digital marketing and e-commerce. Back in the day when the internet was not around, a similar kind of system was there. Marketing is a massive sector in the business world. By affiliation network, the merchant can easily cut down the cost of marketing and gain more sales of their product thus earning more revenue. Payment of the affiliate system of marketing can be tricky. But with the right measures, the revenue-share can be beneficial for every party involved in the business. But to gain this revenue, proper management of monetary expenses is very crucial.