When someone follows your link to a product page they don't necessarily have to purchase the product first time. In many cases a 'Cookie' is saved on the prospective customer’s machine. A cookie is a file which in this instance tells the merchant that it was your link that first attracted the customer to the site. These cookies are valid for a period of time after the customer first uses your link. This depends on the merchant / affiliate network and can be as long as a year. If the product is purchased in this time period you get the commission even if the customer subsequently visits directly the merchant’s site.

There are three basic types of affiliate program payment arrangements:

• Pay-per-sale (also called cost-per-sale): In this arrangement, the merchant site pays an affiliate when the affiliate sends them a customer who purchases something. Some merchant Web sites, like Amazon.com, pay the affiliate a percentage of the sale and others pay a fixed amount per sale.
• Pay-per-click (cost-per-click): In these programs, the merchant site pays the affiliate based on the number of visitors who click on the link to come to the merchant's site. They don't have to buy anything, and it doesn't matter to the affiliate what a visitor does once he gets to the merchant's site.
• Pay-per-lead (cost-per-lead): Companies with these programs pay their affiliates based on the number of visitors they refer who sign up as leads. This simply means the visitor fills out some requested information at the merchant site, which the merchant site may use as a sales lead or sell to another company as a sales lead.

In addition to these, there are a couple of very popular variations on these basic payment plans:

• Two-tier programs: These affiliate programs have a structure similar to multilevel marketing organizations (also known as "network marketing") such as Amway or Avon, which profit through commission sales and sales recruitment. In this instance you not only get a commission on any sales you refer but if someone you referred sells the product themselves you get a commission of these sales.
• Residual Programs:Some programs have recurring commissions. These reward you for the lifetime of the customer. Not only do you earn commissions from the initial sale, but you'll continue to earn a recurring commission as long as that customer remains active. For instance, recurring commission would be there where there is a membership fee involved. You not only would earn money when the customer signs up but you would also earn further commission every time that customer renewed their subscription. As long as the customer was active you would get paid for it.
  

Affiliate marketing programs are a serious way of making money online but you probably won't make much money as an affiliate if you choose affiliate programs that don't have much to do with your site. Because it is usually free, a lot of Web sites join a whole bunch of affiliate programs and figure that enough of them will pay off that they'll make some money. Probably, they'll actually end up canceling each other out: the affiliate Web site will just look like a huge advertisement. Your main assets as a content Web site are your content, your traffic and your knowledge of that traffic, so it's a much better strategy to use the information you have and pick affiliate programs that would best serve your visitors and best supplement your content. If the programs you choose match the content of your site, it should be fairly easy to lead your visitors to participate in them. If you've reviewed a CD on your site, for example, you could simply link to the page selling that CD on an online music store's site. This is an excellent way both to serve your visitors and to make money off your Web site's traffic.

There are number of different affiliate programs and you will be able to find several that you are interested in. To know more the about the different programs see 'Recommended Affiliate Program'.