13. What is the difference between Affiliate Marketing and Referral Marketing?

Basically, affiliate marketing is driven purely by financial motivation and reward whereas referral marketing is more about personal relationships and trust.

In affiliate marketing, the affiliate does not know the prospective buyer and (for example) they would not socialise out of work or have any knowledge of the other’s personal circumstances. The affiliate marketer basically casts his net as wide as he can and of course will sell to anyone who wishes to buy.

Referral marketing however, is more a matter of recommending the principal or his products to the referrer’s family, friends, workmates and other contacts. Basically anyone known to the referrer.

Affiliate marketing often is not given the attention it deserves by sellers and advertisers. Usually search engines, email marketing, classified advertising etc. are uppermost in their minds. But affiliate marketing is responsible for billions of dollars of sales globally and is (or should be) a significant element in any online retailer’s strategy.