When you search for ways to make money online you will come across opportunities in affiliate marketing and network marketing. If you are not sure how these two business models work you will enjoy this article on understanding the differences between both of them.

The main difference between network marketing and affiliate marketing lies in building a downline of distributors. As an affiliate marketer you will primarily make your money selling products or performing a specific action for an affiliate merchant. This could include getting paid by a click or by the lead.

Some affiliate marketing programs have a 2 tier feature. This means that you can also make money on the sales of anybody you personally recruit. However you will not make any money on people that they recruit.

You cannot build a downline of affiliate marketers that you make money on. If building a large organization is something that appeals to you then you want to look at the network marketing business model.

In network marketing you get paid to sell products. You also make money as products move through your downline.

This not only includes people that you personally sponsor, but it includes your downline distributors which can go several levels deep. Exactly how many people you earn money on will vary from one MLM company to the next.

Each one has its own compensation plan. However many network marketing companies also pay you a bonus on the overall volume of the entire company.

This is a great feature becomes as the company grows you get to share in the profits. This does not happen with an affiliate marketing company.

With an affiliate marketing company you can make very high commissions on products you sell. This is especially true if you are selling digital information products.

Some of theses products will pay you as high as 75% in commissions. You can find thousands of them to sell at affiliate networks such as ClickBank.

Affiliate programs are free to join. Therefore they tend to draw thousands of people into them who never do anything with their business.

Network marketing programs require a fee to get started. Therefore you will not have as many people join them.

However, the amount of money it takes to join an MLM company is generally pretty low, so you still have a large number of people who will join and then again not do anything with their business.

One final point to bring up is with network marketing you can generate a residual income. This means you continue to get paid long after you stop working. That is virtually impossible to do with the affiliate marketing business model.

Affiliate Marketing is just about the Biggest Home Business technique used today. It is Huge and Still Growing. Research shows that Affiliate Marketing is a $6.5 Billion Business worldwide and it is expanding fast. There are thousands of people who are making affiliate marketing their full time jobs and are earning thousands of dollars a month doing so.

So why is Affiliate marketing so popular? Simply because the Affiliate business Model has some distinct differences and advantages from any other business model. The main advantage would be the lack of inventory needed to be carried in order to be an affiliate marketer. Which means the affiliate does not require worrying about inventory, storage, delivery, or unsold stock.

Which leads to the second advantage. If you don’t need inventory, that means you don’t need a huge startup capital in order to purchase the inventory before you can start your business. Thirdly, an Affiliate does not need to worry about customer support. All support is given by the merchant directly. The affiliate only helps to promote and makes the sales and the rest is taken care of by the merchant.

Fourth, with affiliate marketing as opposed to any other business model, No physical shop address, no warehouse and cost of the rent, No inventory is ever needed. Plus, since there will be no need for employees, the need of payroll will also vanish. In some cases all is needed is a computer and internet connection and nothing more.

Fifth, with affiliate marketing, one does not have to commute to and from work. They could do it from the comfort of their own homes and this is very quickly becoming the lifestyle many people are dreaming of.

Sounds so simple doesn’t it? Put bluntly, Affiliate marketing is a great way to start business with little or NO setup cost at all. And seeing how well people are doing in this sector of the business model and how fast and vast affiliate marketing is growing, I’d say YES…it definitely is the WAY to go. However, coming to my next point which is, Is it for everyone? If not who is it for?

Well, I’d say its definitely NOT for every single one of us. As simple as Affiliate marketing is made to seem, and I think after reading the above analogy, even I have made it sound exceptionally easy to do, I have to say that affiliate marketing is Far from Easy and does not work for every single person that tries it. A&P(advertising & Promotion) as well as to keep up with the latest trends in the market for getting people to buy from you. You cannot possibly do all of this in 15 minutes a day and will require some time and effort on your part. Although affiliate marketing can be started without any initial capital, it is of course good if you have at least some money to invest in a great manual to guide you along with your affiliate marketing as well as a little for cheap paid advertising if you have the resources for that. There are 2 kinds or groups of affiliate marketers. The successful ones are those who will put in every effort, learn from the experts and overcome ALL obstacles that they come across on their journey as affiliates. This makes them become really successful and go on to become super affiliates.

Affiliate marketing is a symbiotic internet based business relationship between a merchant web owner and an affiliate. The affiliate, or affiliate marketing associate attracts business to the merchant web owners site by posting links from their web pages to the merchant site. Any business that is generated through the affiliate marketing site is then rewarded with the merchant web owner paying commission to the affiliate for referred business through their personal set up of affiliate web marketing.

Once the traffic has been directed to the merchant web owners site, the responsibility of luring the business in is no longer in the hands of the affiliate marketing associate, but in the hands of the web site owner. But the affiliate will be compensated for the referral of business by way of whatever is agreed upon prior to setting up their affiliate web marketing relationship.

If you owned a website you could turn it into an affiliate marketing site just by back linking to various affiliate web sites and having them link to your site in return. Back linking creates a more optimal chance of your site being spotted by search engines and also creates the impression that your website is well renowned and trusted as an affiliate marketing support site. By offering a percentage of whatever profits you make from your affiliates referrals, they can benefit from your product without having to put in any effort, and you can benefit from the increase in traffic and potential buyers directed to you from them.

By constructing solid relationships with decent, trustworthy and business minded affiliate marketing associates, you could easily set yourself up with a thriving business brought in by affiliate marketing for a number of different niche markets.

There are three ways in which affiliate web marketing can occur:

1.Pay per click
2.Pay per sale
3.Pay per lead

By opting for pay per click affiliate marketing business, you would pay your affiliate a pre-arranged amount every time a person clicks on your product through the affiliates website. Pay per sale business would present the affiliate with a fixed amount or a percentage of the total sale price for every item bought that was directed to you through your affiliates marketing website. Pay per lead would be a percentage paid to your affiliate for every potential customer that they brought to your website for future business.

Affiliate web marketing has a structure of revenue sharing that can be extremely beneficial for the web owner and the affiliate, especially if the product or service you are promoting is in demand. Once the structure is in place, there is a minimal amount of work that needs to be implemented to maintain it. Changing your website into an affiliate marketing site will make it work for you, allowing you to generate infinite amounts of income from your daily flow of traffic into and out of your site.