According to HowStuffWorks, “Affiliate courses, also referred to as associate courses, are preparations through which a web merchant website pays affiliate websites a fee to send it traffic. These affiliate internet sites post links to the service provider site and are paid in keeping with a distinctive contract. This agreement is typically based on the variety of people the affiliate sends to the merchant’s site or the number of people they send who buy something or function some other action. Some preparations pay in response to the variety of people who visit the page containing their service provider site’s banner advertisement.
Basically, if a link on an affiliate site brings the service provider site site visitors or money, the merchant site pays the affiliate site in line with their agreement.