If you are planning to set up an online business and do not have a product to sell or if you are a webmaster in need of extra income, you may be interested in affiliate marketing as a solution. You will not have to worry about having products to sell, with affiliate marketing. All you really need is a website with relevant and sufficient content of the products of an online affiliate marketing merchant. You can begin to increase your income by a certain amount when you become a member of an affiliate program.

Affiliate marketing is a business relationship between a merchant and his affiliate. An affiliate marketer agrees to direct traffic to the website of a merchant. When that traffic is converted into some type of action, such as purchasing a product or a visitor becoming a lead for the company on the website of the merchant, the affiliate will be compensated. The application of the affiliate on a merchants affiliate program, will predetermine the type of compensation, whether it takes the form of being a fixed fee or a percentage of sales commission.

Affiliate marketing has become one of the most popular methods of online marketing, promising benefits for both the merchants and the affiliates. Fact is almost every retailer and merchant site will offer an affiliate program you can join. Most people are enticed into becoming members of their affiliate program by the promises of benefits, such as lifetime commissions, large commissions, click through incomes and several other benefits. However, are all these affiliate programs offering the same benefits?

Many affiliate programs pay their affiliates a one time commission for each lead or sale directed to the website of the merchant. This type of affiliate program generally offers large commissions, anywhere from fifteen to sixty percent. Other affiliate programs pay a fixed free per click onto their website, although these types are more likely to pay smaller fees, generally no more that fifty cents per click, sometimes less. However, no sale is required for you to make money when a visitor clicks on the link.

Then you have the residual income affiliate program, which generally pays a small percentage of sales commission for every sale you direct to the merchants website. This type of commission is generally paid in the range of ten to twenty percent sales commission. Residual affiliate programs are sometimes overlooked, because people may opt for the one time high paying commission affiliate program. Is this a mistake or the right decision.

Although, it is hard to tell if it is a mistake to choose a high paying one time commission affiliate program, it is a mistake to ignore the residual affiliate programs. Indeed they may pay a lower rate, however the merchant is offering to these programs would more than likely pay you regular ongoing commissions for a single affiliate directed sale. What this means is for the same efforts of promoting a particular affiliate program, you get paid once in a one time commission program, while the commission of a residual program is regular and ongoing.

Do you understand the benefits of promoting residual affiliate programs? This example, should clear things up.

Let us suppose that there are two merchants online, both offering web hosting services on their websites. Merchant A offers a one time commission type affiliate program, paying $80 for each individual affiliate driven sale. Merchant B also offers an affiliate program, only this time with a residual affiliate program that pays only $10 for each individual affiliate driven sale. Of course it is natural to be drawn to merchant A, since $80 is much more than $10. However, before taking either of them on, you must be able to see that merchant B is offering more of an opportunity to earn a larger amount of money in the end.

Now, let us suppose that you have driven traffic to the merchant and it converts into a sale, with Merchant A, you only get paid once. But with Merchant B, you get paid monthly as long as the consumer you referred to the merchant continues to do business with them. This means that the very same effort of convincing a consumer to use the service of a merchant pays you monthly with a residual affiliate program, while the one time commission type affiliate programs pay you, one time only.

Are residual affiliate programs worth promoting?  Yes, because in the end, you make more money with these types of affiliate programs. Will residual affiliate programs work well for you? Sometimes yes, sometimes no. Since it really depends on your own efforts. However, the benefits of residual affiliate marketing make it worthwhile and it is not wise to ignore such great programs.