Newbie "big picture" questions

[randy]

I'm new to the affiliate world (as in days, not even weeks) and appreciate the efforts here and have gotten a lot of good information fromt the forum in the short time I've been lurking. I plan on designing a content based site with pay for lead links embedded and maybe a sprinkling of adsense...nothing new.

Where I'm having a little confusion during my research is on the different roles/tiers in affiliate marketing. If I'm understanding correctly, there are affiliate managers (CJ, Linkshare, Partnercentric...etc.) who contract directly with the merchants to manage an affiliate program for them and then go out and find a group of affiliates to send them leads. Then the affiliates send traffic/leads...etc to the merchant sites and the management company tracks it and pays them their cut. I'm assuming the affiliate manager probably sends the merchants their own leads too (hence, doesn't have to pay a cut to anyone) which, in essence, makes that affiliate role a "tier 2" role?

This is where it starts getting hazy. If you look at a site like amwso.com, they appear to be an "affiliate management" company but going through their site, they have areas where they refer you to CJ or Partnercentric to sign up for that company's programs...huh? If amwso is a manager why would they want me to be sign up as an affiliate for another management company and not them? I'm assuming there's a revenue stream I'm missing but I'm not sure.

Also, I've signed up as an affiliate on a site and in the control panel it lets me add and keep track of MY affiliates...again, huh? When and why would I have affiliates under me? And why would they be an affiliate to me and not just go directly to the manager and set up their own account? I understand that I'm probably going to get some sort of kick back from the manager but why would someone want to be my "sub-affiliate" when they can work directly with the company.

Alright, I think I've reached my question max for one thread. Sorry if these are too newbie of questions but my head is spinning with all these incestuous relationships in the affiliate world. thanks.

[JAmieF]

It is great that you have such good questions about tiered affiliate programs.

A 2 tiered affiliate program allows you to bring in other affiliates to the affiliate program. That means if you tell your friend to sign up to the same affiliate program as you and they sign up under your affiliate link you will earn commissions on their activity. So basically you are the 1st tier and your friend is the 2nd tier. Having a 2 tiered progrm allows you to earn extra commissions.

There are some affiliate programs that have more than 2 tiers but you usually see them in online gaming.

[Linda Buquet]

Hi Randy,

Welcome to 5 Star and boy did you kick it off with a whopper. More issues here than you know.

1st of all PartnerCentric and AMSO have a strategic alliance and essentially work together, so that can cause confusion. However if you join an AMSWO program and it's on CJ or LinkShare that's a different story and has nothing to do with 2 tier affiliate programs or sub affiliates. AMSWO and PC are management companies. They manage the affiliate programs but the programs are hosted on different affiliate networks. Affiliate managers get paid monthly to RUN the programs and networks are the infrasture for reporting and banner serving.

Some programs are 2 tier. The affiliates that join from your link get the same commission they would if they went direct, so no need to bypass you. So you are getting a commission for referring them.

Hope this helps to clarify, I know it can get confusing!

[randy]

Thanks Linda, and that helps a lot. The whole scene is still pretty muddy but I'm new and that's a day to day challenge for me in general