Affiliate marketing is gaining popularity day by day because of the increasing consciousness amongst the masses about it. Merchants as well as the affiliates have realized that this form of marketing proves beneficial for both of them. It gives the merchant the opportunity to advertise their products at a low cost while the affiliates find this type of business as an easy way to earn money online and that too by doing something that they enjoy -- developing websites.

People's perception about this form of online marketing has changed along with its rising popularity. Today, no one considers it as merely an alternative method of advertisement of products by a merchant or as a source of additional income. As of now, affiliate marketing has become the main source of profits and revenues for the merchants as well as for online entrepreneurs.

Now, there can be a number of questions that could be asked about this business. For example, what type of programs should one consider? Do they all accrue the same benefit? Are they all the same deep down or are there some programs that prove to be more beneficial than the others?

It is true that there are different types of programs but these types surely depend on the way one classifies them. However, fundamentally programs can be classified two main ways -- pay per click (PPC) and pay per performance (PPP).

Pay Per Click (PPC) And Pay Per Performance (PPP)

PPC is the most popular as well as the easiest way of earning money for affiliates having smaller websites. Payment is made when a visitor is referred to his site when a user clicks through the merchant's banner or text ads. This payment does not depend on whether the visitor makes any actual purchase on the merchant's site. Contrary to that, under PPP marketing one gets paid only if the referred visitor actually makes any purchase or if the referred visitor turns into a lead. Due to this difference, the returns on PPC would be comparatively less than PPP. PPP marketing is considered a better bet for both the merchant as well as for the affiliates.

Pay Per Performance (PPP) has been further classified into two categories: Pay Per Sales (PPS) and Pay Per Lead (PPL). As the name suggests under the PPS system, money is made only if actual sales are made. In contrast, under a PPL system, payment is made if the visitor fills out an application form or any such similar form related to business of the company. This kind of system is used by companies which depend on leads for their growth like finance and insurance companies.

Single Tier, Two Tiers And Multi-Tier Affiliate Marketing

These are different types of marketing programs depending on the depth of the affiliate network. In the case of single tier marketing, an affiliate only gets paid on the basis of direct sales or traffic that he has referred to the merchant's site (for example PPS, PPL and PPC). In two tier systems, he gets paid for the direct traffic that he has personally referred and also for traffic or sales that has been made by other entrepreneurs recommended by him. In multi-tier programs, the affiliate gets paid like in two-tiers but besides that he also gets paid for other people in different tiers in the sales forces.

Residual Income Affiliate Marketing

A final form of marketing involves residual income. In this type of program, money is made not once but every time the referred customer makes a purchase on the merchant's site. The payment may be made as a fixed amount or as a percentage of the sale amount depending on the program.

Thus, we find that there are a number of affiliate marketing programs and the choice that one makes must depend on one's own convenience and requirements. There is money to be made in all forms these programs and joining some of them is a great way to start any online business.