Affiliate marketing can compared to freelance commission-based marketing where businesses use freelancers or independent agents to market and sell products and services to their clients. They do not get paid unless they make sales.

As with the "real" world programs, affiliate marketing involves two parties, apart from the clients. On the one hand we have the

• merchants: businesses, either online or "real" world, that want to promote their products in a cost effective way using freelance "agents" to market and sell, and on the other hand we have
• affiliates: also called associates, publishers, resellers and sometimes partners, individuals or businesses that want to promote or sell products and services for a commission on a freelance basis.

And both these parties are vital to the success of the program.

Without the merchants the affiliates would not have products or services to promote and sell; without the affiliates the merchants would not have the cost effective sales force online.

Affiliate programs come in all shapes and sizes, cover just about every product or service out there, crosses national and international boundries.

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Affiliate marketing is, in effect, a joint venture or partnership between businesses with products and services to sell (merchants) and businesses who want to sell products or services (affiliates) without the expense and hassles of carrying stock, servicing customers, product delivery, etc.

Affiliate programs, sometimes also called associate programs, reseller programs or partnership programs, are set up by merchants who then recruit affiliates who in turn will promote the merchant through web sites and email campaigns.

Both the merchants and the affiliates are involved in affiliate marketing; merchants on the supply side, affiliates on the sales and marketing side.

Affiliate marketing benefits both sides, the merchant doesn't have to employ a sales force and pay them even if they do not perform, the affiliate doesn't have to carry stock or service the clients.