A Brief History of Affiliate Marketing

Affiliate marketing has made its way to the business industry today. It is a digital way of earning money that allows you advertise or promote any services and products you want. With the power of Internet, combined with a generous amount of patience and then mix the willingness to learn, you can achieve your desired goals in this field. Since it seems to be an easy money, aren’t you curious on how it started?

Where it all started…

Most people assume that Amazon invented affiliate marketing but the truth is it started with the man named William J. Tobin. In 1989, he was the one who holds the proud title of the world’s first internet marketer. The idea of affiliate marketing was conceptualized by the founder of PC Flowers & Gifts; Tobin, and launched his program on the Prodigy Network. The model he launched involved paring the Prodigy network a commission on every sale. On the year 1993, it was already generating more than $6 million yearly for Prodigy. Because of this success, Tobin was encouraged to patent the idea in 1996 but it wasn’t issued until 2000.

Here is when Amazon entered…

Amazon arrived in 1996 with their associates program. Even though they are not the one who started the idea of affiliate program, they were the first to attract global interest. Their model became the model for many affiliate networks that followed. Amazon’s model involved paying a commission as a percentage of the sold product.

Johnson and Samuel Gerace established BeFree in the same year and Linkshare which was founded by Stephen and Heidi Messer.

Some students from the University of California Santa Barbara set up Commission Junction in 1998 which became the world’s biggest affiliate marketing provider. Then the Clickbank Network was also founded on the same year by Tim and Eileen Barber.

The aforementioned networks offered payment solutions and facilitated exchanges between affiliates and merchants. It also enabled smaller retailers outside of Amazon to get involved in affiliate marketing as well.

The Rules and Regulations of Affiliate Marketing

The U.S Federal Trade Commission published guidelines for affiliate marketing in 2000 with regards to disclosures. The regulations of “Dot Com Disclosures: Information about Online Advertising” drastically influenced the legitimacy of affiliate marketing in the world of online marketing. The legislation was updated in 2008 which requires bloggers to disclose their relationship with the companies they are promoting.

The Downfall of dot.com and Onwards

In 2001 dot.com created significant changes in affiliate marketing. During the commercial rise of the Internet, the rage of online business ventures that had been built came crashing down in early 2000. Business fundamentals reasserted themselves that caused the technology stocks to lose 60% of their value in just one year.

Making money online is no longer a sure thing. In order to succeed in the industry, online marketers realized that they would need a deeper understanding and become more knowledgeable in their field. With this realization, affiliate marketing guides and “secrets” of affiliate marketing started to spread out on online bookshops. They were offered to anyone who is willing to pay for them.

The Future of Affiliate Marketing

Affiliate networks were reported to be turning in approximately £2.16 billion in UK alone by 2006. The worldwide revenues estimated to have reached $6.5 billion which came mainly from personal finance, travel, and gambling, telecommunications, gaming, retail and lead generation. In 2012, UK’s whole online economy in affiliate marketing represented 6%.

It is evident that affiliate marketing will continue to rise especially with more and more online stores outperforming their offline counterparts. Consumers will continue to crave for more information and do some deep research before purchasing any product or services. Now that you have learned its history, are you ready to enter the world of affiliate marketing?

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