Internet marketing has created endless possibilities to create revenue. Affiliate marketing has evolved as a consistently growing opportunity and venue for the Internet savvy entrepreneur. However, this lucrative marketing enterprise creates the need for specific contract and legal obligations.

Is An Agreement Needed?

Whether you are setting up or participating in an affiliate program, you will need an Affiliate Agreement. Typically, this form of agreement is posted directly on the Web site. The agreement or affiliate contract explores the “what ifs” at the formation process in order to create proposed solutions.
It is important to delve into and create solutions for any problems that may arise. Being proactive in this endeavor will reduce aggravation later. Generally, the potential affiliate partner enrolls in the program and agrees to the terms and conditions of the Affiliate Agreement, by checking a box that says “I have read and agree to the terms and conditions.” It is important to be familiar with the terms. Remember, all contracts and agreements are negotiable.

Do I Need To Use an Attorney?

If you are creating an affiliate marketing program and are in need of an agreement, use an attorney well versed in business partnerships. Often times, in order to cut corners, some may try to go it alone or use a “verbal” agreement. These type of relationships are complicated and although there can be lucrative results, without proper protection, disaster can occur. If you do not understand an affiliate agreement that you are about to enter into, it is important to get legal counsel.

What is an Affiliate Agreement?

A Website Affiliate Agreement sets forth the terms under which one website may become an affiliate of another, providing promotional services in exchange for commission payments. An affiliate contract generally contains the details of two main components: terms and compensation. There are many requisites of an affiliate contract.

Some of the key provisions that are addressed in an Affiliate Agreement are as follows:

• Payment/Commission Terms
• Frequency and schedule of payments
• A provision for indemnification in the case of infringement by any content created by either party.
• An explanation of how the referred customers will be tracked and reported.
• Who is responsible for the creation of the advertising?
• What types of links will be provided to the affiliate? (i.e. product link, a search box link, or some general text link )
• What are the trademark guidelines and may trademarks be used in title tags?
• Is there the right to remove the advertising if the advertiser fails to pay?
• Who will be liable for errors in the text of the ads and/or in the running of the ads in terms of times and placement?
• What are the requirements to end or terminate the agreement?

When joining an affiliate marketing program, it is easy to sign up and agree to terms without reading them. This is a mistake. The terms and conditions construe a legal contract. Tedious as it may be, it is imperative to read the agreement completely and carefully!

Affiliate programs can be a lucrative partnership for both sides. In order to proceed, there must be guidelines for all parties to follow. As a result, this complicated relationship should not be entered into without a strong contract protecting all who are involved.