A Brief History of Affiliate Marketing
- by Scott Bamboo
Affiliate marketing started at a curtail party, Jeff Bezos, CEO and founder of Amazon.com, as chatting with a party guest who wanted to sell books on her Web site. This got Bezos thinking. Why not have the woman links her site to Amazon’s and receive commission on the books that she sold? Soon after, Amazon introduced the Amazon Associates Program.
It was a simple idea. Amazon Associates would place banner or text links on their sites for individual books or link directly to the Amazon’s home page. When visitors clicked from the associate’s site through to Amazon.com and purchased a book, the associate received a commission. With that thought, Bezos created Amazon’s affiliate program in July 1996.
But Amazon wan't the first company to initiate an affiliate program. According to Brad Waller, VP of affiliate and Business Development for Epage (ep.com), the affiliate program for Epage started in April 1996. As documented in “The CDNow Story: Rags to Riches on the Internet,” CDNow’s affiliate predates Amazon’s by more than a year.
In November 1994, almost a full year before Amazon.com even launched its Web site, the venerable CDNow began its buyweb program. With its buyweb program, CDNow was the first to introduce the concept of an affiliate or associate program with its idea of click-through purchasing through independent, online storefronts.
CDNow had the idea that music-oriented web sites could review or list albums on their pages that their visitors might be interested in purchasing and offer a link that would take the visitor directly to CDNOw to purchase them. The idea for this remote purchasing originally arose as a result of conversations with a music publisher called Geffen Records in the fall of 1994. Goffen Records wants to sell its artist’ CDs online and CDNow actually sold the discs. The affiliate marketing format was born and CDNow formally introduced the concept as “buyweb” in the fall of 1994.
By 1995 there were a few hundred affiliate members in the buyweb program. CDNow created a methodology that enabled them to track purchases that online customers made and pay the referring websites 3% of the revenues from the discs that CDNow sold that were directly attributable to the links. Participating websites were now able to add value for CDNow by recommending various compact discs to their website visitors that could be purchased on CDNow’s website.
This was the first affiliate marketing program on the Net.
From CDNow and Amazon’s affiliate marketing programs, come the beginnings of the affiliate programs we see today that have become a marketing staple of many online companies. As the number of commercial websites continues to explode, the marketing problems of attracting targeted consumers to a particular website, making a sale, and then securing repeat visits, has become acute. Today, if companies want to success in their affiliate marketing, they will need a hybrid marketing program that delivered both sales and branding, and not just simple impression.
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