How does Affiliate Marketing Work?

It doesn't matter whether your a Newbie looking to make some money online, a store looking for extra sales, or a product developer trying to promote a new product, Affiliate Marketing can work for you!

So Just How does Affiliate Marketing Work?

Although there are different compensation methods in Affiliate Marketing the fundementals are the same.

A Seller offers payments to individuals for either finding Customers "Pay Per Sale" or Prospects "Pay Per Lead". The concept is simple Affiliates join the Sellers affilliate program & are given a special URL Link that has an "identifying" tracking code inserted.
The Affiliate then publishes this individual URL Link on their blog, webpage or any medium they choose.
When a visitor clicks on the Affiliates link & is sent to the vendors site, a Cookie is automatically set on the visitors computer.
Once the cookie is set this visitor is assigned to the Affiliate that sent them to the site.
If the visitor buys the product or products the Affiliate will be credited with the sale & receive a % of the sales value, as a reward for sending the customer to the seller. The cookie on the visitors computer also ensures that if this potential customer does not buy on their initial visit but returns & buys within a set time period the affiliate will still receive credit for the sale.

Advantages of Affiliate Marketing

Vendors not only increace their online presence with many more links pointing to their site but they can also greatly reduce their advertising costs while increasing sales.

Affiliates can make money online without having a product, or needing to offer customer support. If you are considering online marketing as a suplimentary form of income, (Second Job) the requirement of offering customer support can be very difficult, Affiliate Marketing solves that issue & is great for Newbies.

Ok so where do you start?

Affiliates - Affiliate Promotion can be incorporated into almost any form of online media, some not even requiring a website, Squidoo Lenses, Twitter & Yahoo Answers to name just a few.
If you are thinking of building your own website I suggest you follow the "Start Here" tutorial. Then become a member of several Free to Join affiliate Programs. Browse through these Affilate networks for products that compliment your websites content. If you have a paticular product in mind also perform a web search for "product name affiliate" or "product name partner" this will find the Vendors that are running their own programs.

Affiliate Software
If you already have a store but wish to incorporate an Affiliate Program then I suggest - IDevAffiliate or Post Affiliate Pro Affiliate Management Software. 

Affiliate Networks
Joining an Affiliate Network saves vendors the trouble of finding their own affiliates, these networks have thousands of active affiliates looking for products to promote. I would recommend Share a Sale for physical products & Clickbank for Digital Products.