An affiliate network is basically an intermediate amongst publishers and merchant affiliate programs. Affiliate networks assist publishers or affiliates as they are usually known, to easily know the affiliate programs that will get more traffic and hence more income for their web sites. It also allows the online merchants to market their affiliate programs to all publishers who are taking part in the affiliate networks. It is an equally beneficial scheme for publishers and online merchants to get together at one place and earn the benefits.

Affiliate networks are based mostly on the idea of revenue sharing that is, they let merchants offer a part of revenue produced to him from traffic to the publisher's web site. There may also be a fee for each visitor on the site that undertakes and completes a certain action such as making a purchase, or for signing up and subscribing for a newsletter or a magazine. But usually revenue sharing is the common method in comparison to or contrary to a fee-per-action model. Affiliate networks with many advertisers also draw in a large pool of the publishers. Big affiliate networks generally do not need to hire publishers as the publishers usually head to them on their own. Typically websites that attract the same kind of customers as the advertisers but without any competition in them are standard affiliate network associates.

Affiliate networks have grown rapidly since their inception. Regarded as marketing toys in early days of world wide web, they have develop into an important part of business plans of many organizations around the world. In reality they have been so profitable that they have grown into larger businesses than the existing offline business. The total sales amount produced according to one source by affiliate networks is £2.16 billion in UK by itself for the year 2006. And In the same year for the USA the overall bounty amounted close to US $ 6.5 billion.

Affiliate networks are mainly used in assortment of sources like retail, gaming as well as gambling, personal finance, travel, education, telecom and publishing. Traditionally the affiliates are welcome to join the network free of charge while there is mostly a minimal fee for the merchants to participate. The network also charges the first setup or a membership fee which are recurring. Even though affiliates join for free but they pay a certain percentage of their income as compensation to affiliate network.

Affiliate networks are a huge conglomeration of publishers and suppliers working towards a common goal; profit realization. Merchants bring in benefits like tracking technology, payment processing, reporting tools as well as a large group of publishers from the affiliate network. On the other hand, affiliates bring in services and benefits such as affiliate programs, reporting tools and also payment aggregation by using the network.

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