History Of Affiliate Marketing.

History Of Affiliate Marketing.

Like many digital marketing innovations, the beginnings of affiliate marketing

are to be found in the Adult industry. Cybererotica was probably the first to run

an affiliate campaign with its CPC programme, where it would reward referrers

for each clickthrough to its website.

Affiliate marketing moved closer to the mainstream, with programmes offered

by companies such as CDNow (its BuyWeb programme launched in 1994), PC

Flowers & Gifts.com, AutoWeb.com and a handful of others. But the story that

is most well-known, and ensured that affiliate marketing hit mainstream press

articles, is that of the Amazon.com Associates Program.

Legend has it that Jeff Bezos (the CEO and founder of Amazon.com) was at a

cocktail party where a woman told him that she wanted to sell books through

her website. She did not have the infrastructure to sell the books, but Jeff

Bezos realised that she could send her targeted traffic to Amazon.com where

users could buy books, and she could get paid for each successful referral.

From this, Jeff Bezos launched Amazon Associates, the Amazon.com affiliate

marketing programme. Referrers are rewarded for successful sales that occur

as a result of their marketing efforts. The growth experienced by Amazon.com

as a result of their affiliate programme is well documented, and probably

accounts for about 40% of their revenue (according to information in Amazon.

com discussion forums).

According to Jupiter Research (2008), total sales generated through affiliate

networks in 2008 was an estimated £2.16 billion in the UK alone. And the same

report estimates that in 2012, affiliate marketing spend is to reach $3.3 billion!

Affiliate networks, which act as intermediaries between affiliates and

merchants, came onto the scene in 1996, with the launch of LinkShare and

Be Free. Commission Junction, another big player, launched in 1998 and was

bought by ValueClick (Nasdaq: VCLK) in 2003 for about $58 million.