If you have ever read anything about Internet marketing, you’ve probably heard a little about affiliate programs. With an affiliate program, you host a banner or text ad from another website on your site. When your visitors click on the affiliate link, you get paid. Sometimes affiliates pay per click (a few cents). Other affiliate programs offer a commission (percentage of sales) if visitors from your website purchase something on theirs.

Many Internet marketers enroll in a number of affiliate programs, because in most cases they only earn a few cents per click for each program. Enrolling in carefully selected affiliate programs that complement but do not compete with your business can be a good way to make money online.

However, an even better way to make serious money is to start your own affiliate program, and enlist other websites to advertise your products and services for you. It’s like hiring a sales force that works cheap, but effectively.

As long as you offer a decent commission for your affiliate program, you will attract several people interested in becoming affiliates. Of course, the higher the commission you offer, the bigger “sales force” you will amass. It’s a good idea to look at other affiliate programs that are related to your business area and find out what their commissions or per-click pay rates are, then offer a higher payout if you can.

You’ll need to write an affiliate sales letter that outlines your program. This letter should be just as compelling and persuasive as your sales letter for your products or services. As you create your affiliate program, try to think of things from the potential affiliates’ point of view. What are the benefits to them when they enroll in your program—outside of profit, of course? Are you offering quality products or services their customers will enjoy? Do you have bonuses for top performing affiliates?

If you create an affiliate program, you will also have to design your own banners and text ads for your affiliates to place. Not only is this more convenient for your affiliates, it is also more effective for sales. You know your products or services better than your affiliates will, and so you are the best person to craft compelling ads that will draw visitors from your affiliates’ sites to yours.

When you are ready to set up your affiliate program, there are a few options available to you. If you have a decent level of computer skill, you can purchase affiliate software program that will allow you to design and track your program yourself. Another option is to “hire” a third-party affiliate tracking company.

There are benefits and drawbacks to each program. With affiliate software, you have complete control over the design of your program, and you keep all the profits. However, you must be prepared to invest more time in the program, as you will be handling all of the tracking, enrollment, and issuing of commission checks yourself.

If you use a third-party company, you must pay them a commission (normally this fee is subtracted from your affiliate profits, and the balance is forwarded to you). However, you won’t have to worry about sign-ups, tracking, and commission payout, so you will have more time to devote to other areas of your business.

There are many different affiliate software and third-party affiliate tracking companies to choose from. As with all other aspects of your business, you should research them and decide which one best suits your needs. Here are a few to get you started: