What is an affiliate program?

The concept of affiliate program is based on the age-old business practice of referral service. This is quite common in many industries. An attorney, for example, gets a certain percent of commission if he refers a client to another lawyer.

Back in 1996 Amazon.com started the first widespread use of referral service on the Internet. If a client comes to Amazon.com and buy a product using a link provided by Amazon, from a website which signed affiliate partnership agreement, that site receives 10 to 15% commission from the sale. The Amazon Affiliate Program became so successful that it prompted others to follow the suit. Today, affiliate programs became ubiquitous on the Internet making them one of the primary methods of online marketing of products and services.

Affiliate Program can be defined as Internet marketing system where a company allows and helps third party websites, called affiliates to post link and refer clients in return for a predetermined flat-fee or percentage-based commission.