How is "revenue" defined?

Most affiliate programs (commission-based ones) pay a certain percentage of the revenue your site visitors generate. But the meaning of the word "revenue" can vary wildly depending on which site you are looking at.

Many programs pay commissions on the gross value of a sale; that is, the amount of money that the site will actually receive in payment for the goods or services being ordered. This almost always excludes additional charges for credit card transactions, and delivery charges -- which is fair enough, since most companies pass these charges straight on to their customers without marking them up.

A few sites apply much less generous definitions of "revenue"

For example only paying commission on the profit of a sale. As many Hollywood players have found to their costs, it is very easy to massage the figures until the visible profit simply melts away. You're likely to earn a really miserable commission if you sign up for this kind of service, as the profit margin will at best be about a quarter of the total value of any sale, and your commission will be a small fraction of this much smaller pie.

This issue of "revenue" is often buried deep in the Affiliate Agreement you will have to sign when joining the program. So read the Agreement carefully and make sure where you stand before you get going.

Many (UN)Happy Returns!

Although it is completely understandable from a business point of view, you need to be aware that virtually all affiliate programs only pay you for sales that have actually completed and where the customer has opted to keep the goods. That's right: if a customer returns the goods for a refund, your commission will be canceled; you may even be sent a bill for the amount of the commission if you do not have any earned credit outstanding with the company in question. This shouldn't happen too often, but be aware that the possibility exists when you are plotting to rush out and spend your nice fat cheque!

What is commissionable?

You need to be clear what you will earn commission on, and how that commission will be calculated. For instance, some affiliate programs will only pay you commission on the specific item you link to, and even then only if the visitor fills in the payment details immediately without clicking on any other link out of the order page (a very unlikely scenario). In this case, even if your intrepid visitor goes on to buy 30 kinds of widget from WidgetsRUs, you would only see the color of money if they bought the Purple Citrus-flavoured Widget that your site's link pointed to.

Other programs pay commission on all the items sold during a single visit to the site, or even in some generous cases on all the items sold during a given period of time from the date of the visit (up to 30 days' after, for instance)

A quick look at cookies

Many sites make use of a tracking technology known as "cookies" to keep track of a visitor's progress across the site. A "cookie" is a small piece of data that is stored automatically by your web browser. Inside the cookie, the site will have encoded a certain amount of information about the customer, such as a unique tracking code or address details.

The problem with this approach is that cookies can be refused, discarded and eaten. Some paranoid web surfers, worried about their online privacy, systematically refuse to accept cookies from web sites they visit. In this case, their purchases will not reward you in any way since the site has no way to track them. Cookies will also be discarded when the storage area for cookies fills up (depending on your web browser, the storage area has space for up to a few hundred cookies). Again, if you are participating in a program where you are supposed to receive income over an extended period of time, you may well find yourself empty handed if the cookie expires and gets overwritten by a new one. Finally, certain system maintenance programs also "clean" your computer by deleting cookies.

Unfortunately there is very little you can do about this problem, except be aware that it exists, and that it may well have an impact on your results.

Where, oh where has my little cheque gone?

You need to be aware of how long it will take for your cheque to get to you. Some affiliate programs pay fairly promptly, a few days after the end of each calendar month for earnings clocked up during the previous calendar months. With some other programs you may well grow old before you receive a cheque; they pay extremely slowly, for instance 90 days after the end of each calendar quarter. On the Internet, anything can happen in a few months: bankruptcies, server crashes and glitches etc. so be wary of a program that will hold onto your earnings for months on end.