When searching for a work at home business, an internet business "newbie" is likely to stumble upon affiliate marketing programs. A program with good products, training and support, can deliver profits and success for those who work consistently to a successful "blueprint." Understanding them is important, though, before getting involved with one.

First a person needs to understand the differences between an affiliate marketing program and a pyramid scheme. The most important difference is the issue of value for money. A pyramid scheme typically does not have products or services to sell. Members are paid simply to recruit others and the natural result of this would be high membership fees to pay the commissions. When the recruiting goes down many levels, the fees are likely to be higher. Those who fail have lost their money and gained no value in what they have paid for.

The foundation of a good affiliate marketing program is a company that sells products or services and provides good value for money. This company then decides to find people who will sell their products or services for them. The company recruits these people, called affiliates, to sell their products and earn a commission for each product they sell. In some programs the company will supply the affiliate with a website and all the tools they need to get started. The affiliate is then encouraged to advertise their website and sell the products from their website so they can earn a commission.

In addition to selling the products or services, some programs may include a multi-level commission plan. This encourages the new member to refer others to sign up for the program. Commission is then earned for the affiliate member when the members they referred make sales. This process can go for many levels. Small amounts of commission on product sales in a large group of affiliates can add up to large profits for the person who referred them. If the products or services are good value and members are motivated to buy each month then the successful affiliate will be earning residual income on those sales. That is, each customer they find who becomes an affiliate, becomes a sale each month. One customer equals many sales for as long as the customer is getting good value for money and perhaps being helped to succeed in the business as well.

The end result is that income is only earned when goods or services are sold.

The internet has revolutionized the way people can promote this sort of home business. There are many ethical internet strategies that can be used to attract customers who are looking for the products you are selling. This is where good company training and support are vital.

Affiliate marketing programs are gaining popularity because they usually have lower start up costs and are less time consuming than traditional small businesses. A lot of the preliminary tasks are already done for you to allow you to focus on what is important. That is learning and implementing your marketing strategies. There are great financial rewards for those who can learn and consistently apply successful strategies, including helping and encouraging those they referred to succeed.