Management Information System (MIS) Practice Exam

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In affiliate marketing, website owners are typically compensated based on what?

The number of impressions
The number of clicks
The number of sales generated
The time spent on site

The correct answer is: The number of sales generated

In affiliate marketing, website owners are typically compensated based on the number of sales generated. This model aligns the interests of the affiliate (website owner) and the merchant, as affiliates earn a commission for driving actual sales rather than just traffic. This approach incentivizes website owners to deliver high-quality traffic that is more likely to convert into purchases, thereby maximizing the effectiveness of marketing efforts. While other compensation models like pay-per-click or cost-per-impression exist, they do not directly relate to the core goal of affiliate marketing, which is to drive sales and revenue for the merchant. Focusing on sales ensures that affiliates are rewarded for successful outcomes rather than just engagement metrics, which might not ultimately lead to any sales. This performance-based approach fosters a more results-oriented marketing strategy, making it a cornerstone of effective affiliate marketing.