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Affiliate Internet Marketing – Why it Works
How Affiliate Marketing has evolved as the Internet Powerhouse Tool

My father (as fathers will do) tells a story about the incident that forever changed his way of thinking about making money. One day in his youth, while at work cutting down trees, he noticed the foreman talking to a man with a handful of red ribbons. This man then proceeded to tie his red ribbons around choice trees. Upon finishing, he walked away in his nice suit, having never broken a sweat.

My dad asked the foreman, “Who was that guy?”

The foreman answered, “That’s the salesman!”

“The moral of this story is…” says my dad with a winsome smile, “…it’s better to be the man with the red ribbons.”

Perhaps it is, perhaps not, but this much is true: some of us chop trees and some of us tie ribbons. The fact is we need each other. There will always be those that make widgets and those who sell them. The sellers don’t know how to make them and the makers don’t know how to sell them. So, sellers and makers historically enjoy a symbiotic, “win/win” relationship.

The question over the past decade has been how to apply this truth to the Internet. The first attempts at Internet marketing were based on the traditional advertising concept of selling space/time - as in the magazine, billboard, TV and radio models. Hence, Internet banners and pop-ups were born, and merchants paid high prices for space/time on choice websites. This resulted in a bubble effect which soon deflated, leaving Internet marketing confusion and mistrust in its wake.

Jakob Nielsen, often referred to as “Sun’s web design guru” says, “Well, banner ads don't work. … I think the basic point about the web is that it is not an advertising medium. The web is not a selling medium, it is a buying medium. It is user controlled, so the user controls, the user experiences. My hand is on the mouse. I decide where I want to go. If I don't like it here, I will go a lot of other places instead.”

If it is not an “advertising medium” how can we use it to sell? People hate banners, spam, and pop ups. They even buy software to stop it. It seems hopeless.

However, while we were barely watching, the Internet was growing into its own. It refused to be forced into the marketing model we chose for it. Like a rebel child with a spirit of its own, it developed, with little help from marketers, into what it was born to be – a community - something billboards, magazine spreads and radio spots cannot be.

The adolescent Internet grew through its lanky, awkward, failed marketing stages and developed a life force of its own. It became a community – and it’s a community that wants to talk! Chats, blogs, forums and informational content sites grew in prominence until the era of the Internet became known as the “Information Age.”

How do you sell on the Internet? Easy, talk! The Internet is a talking community, full of friends, advice and experts. The time/space model doesn’t work here, the word-of-mouth principle (also called viral marketing) does. As gossip spreads exponentially through progressive multiplication, so does a personal recommendation on the Internet. Far from being a marketing failure, this baby has grown into a marketing powerhouse. Even banners and pop-ups are more acceptable when perceived as a “tip” from a friend (offering a personal recommendation for further information about a popular subject).

“Each one reach one” is the adage at the heart of the affiliate model. Ironically, the Internet is not separating people as its early naysayers warned. Rather, it is spawning dynamic communities and, as marketers know, communities are inherently targeted groups.

The affiliate model works because the widget maker (who is generally not a community maker) enjoys the benefit of the powerful word-of-mouth, personal recommendation of a successful community maker/ widget seller/ “affiliate.”

This affiliate hosts a popular community or content site and has gained the confidence of his/her readers. The affiliate’s personal recommendation inspires the readers to check out the widgets on the recommended site. If the affiliate’s reader goes on to buy a widget, the affiliate gets a commission on the sale. Win/win.

So, whether you happen to chop trees or sell them, affiliate programs are one of the most powerful sales tools available for today’s Internet marketing expert. If you make widgets, affiliates are your sales associates who literally go to the ends of the earth to sell your product. If you are a community maker, start adding those “red ribbons,” i.e. affiliate’s banners, to your websites. Soon you too will be reaping the self-replicating rewards of viral marketing.