History of Affiliate Marketing: From Flower Gift Shop to a 12 Billion Dollar Industry

History of Affiliate Marketing

As someone who's spent more than a decade in affiliate marketing, I've often found myself reflecting on its origins and how far the industry has come.

What started as a simple concept has grown into a multi-billion dollar global powerhouse, one that continues to evolve and create opportunities for individuals and businesses alike.

But where did it all begin? Let’s take a journey through the fascinating history of affiliate marketing.

The Early Days: The Visionary William J. Tobin

Affiliate marketing can trace its roots back to the early 1990s, an era when the internet was still a fledgling concept.

It’s hard to imagine now, with our constantly connected world, but online commerce was a brand-new idea. That’s when William J. Tobin, the founder of PC Flowers & Gifts, had an innovative spark.

Tobin wasn't just content with being one of the first to sell flowers and gifts online—he wanted to expand his business’s reach in a unique way.

In 1994, Tobin introduced what’s widely regarded as the first affiliate marketing program.

It was revolutionary: independent website owners could promote PC Flowers & Gifts on their sites, earning a commission for every sale that originated from their referrals.

This idea created a win-win scenario. The merchant got increased exposure and sales, and the affiliate earned a slice of the revenue. This model of revenue sharing, originally born out of necessity and innovation, became the foundation for the affiliate programs we see today.

Tobin’s breakthrough laid the groundwork, but affiliate marketing was still in its infancy. Enter Amazon.

CDNow and the BuyWeb Breakthrough

In 1994 shortly after PC FLowers & GIfts, CDNow launched its BuyWeb program, another game-changer for affiliate marketing. The idea was sparked by conversations with Geffen Records, who wanted to sell CDs directly from its artists' websites without handling the logistics. CDNow stepped in, creating a system where music websites could link directly to albums on CDNow, earning commissions on sales.

This concept of direct linking allowed affiliates to promote specific products rather than just the company, offering a more targeted, effective marketing approach. BuyWeb showcased the power of affiliate partnerships and helped pave the way for the sophisticated affiliate marketing we see today.

Amazon Changes the Affiliate Marketing with their associate program

In 1996, Amazon launched its own affiliate program, known as Amazon Associates.

While Tobin’s program was groundbreaking, Amazon took affiliate marketing mainstream. Suddenly, anyone with a website—not just big businesses—could join the program, promote products, and earn commissions.

This democratized affiliate marketing in a way that hadn’t been done before.

The scale and scope of Amazon's platform set a new standard. They introduced a robust tracking system, ensuring affiliates were credited properly for referrals.

More importantly, they offered a wide array of products for affiliates to choose from, meaning anyone could promote items that aligned with their audience’s interests.

This flexibility was a game-changer and created a massive ripple effect in the industry. As Amazon's program grew, so did the understanding of affiliate marketing's potential.

More and more people started to see it not just as a side hustle, but as a viable way to build a business.

Rakuten which is another very big Affiliate Network that is still around today was also founded in 1996.

The Rise of ClickBank and Commission Junction and Affiliate Networks

As affiliate marketing evolved, two platforms emerged that would become pivotal in the industry: ClickBank and Commission Junction.

ClickBank, founded in 1998, became a key player by focusing on digital products. It offered a marketplace where vendors could list products, and affiliates could choose which ones to promote.

This simple yet effective model opened the doors for thousands of individuals and small businesses to enter the affiliate world without needing to manage physical inventory.

ClickBank revolutionized the industry by making it accessible for people to monetize blogs, websites, and email lists, offering high commissions and an easy-to-use platform.

Clickbank was also the first network I really did well with and I'm not sure if I would be here today without working with them.

Around the same time, Commission Junction (founded in 1998 as well) took a different approach by partnering with major retail brands.

It provided a platform where businesses could manage their affiliate relationships in one place, and affiliates could access a variety of companies to promote.

With its focus on transparency, tracking, and reporting, Commission Junction became one of the most trusted platforms in the affiliate marketing space.

Both platforms played crucial roles in shaping the affiliate marketing landscape, offering affiliates more opportunities and better tools to grow their businesses.

These companies laid the groundwork for the modern affiliate networks we rely on today like ShareASale(2000), AvantLink(2005) and many more after them.

The Dot-Com Boom and Bust: Affiliate Marketing’s Growing Pains

The late 1990s was a period of incredible optimism in the online world. The dot-com boom was in full swing, and affiliate marketing rode that wave of enthusiasm.

Hundreds of new businesses jumped online, all looking for innovative ways to drive traffic and sales.

Affiliate marketing was an obvious choice—it was low risk and high reward, making it a perfect fit for the era’s budding internet-based companies.

But as we know, the dot-com boom didn’t last forever. When the bubble burst in the early 2000s, many businesses folded, and the affiliate marketing space took a hit.

With fewer businesses to promote, some affiliates found themselves out of work. However, this wasn’t the end. It was a turning point.

During the recovery from the dot-com bust, businesses realized that affiliate marketing wasn’t just about sales—it was about relationships.

Merchants began to see the value in building strong, long-term relationships with their affiliates. This led to more sustainable practices and better collaboration, laying the groundwork for the modern affiliate marketing ecosystem.

One of the companies that survived was Google and they go on to play a huge role for affiliates and still do till today.

Google AdWords: A Game-Changer for Affiliate Marketing

In 2000, the launch of Google AdWords (now Google Ads) transformed affiliate marketing.

For the first time, affiliates could bid on keywords and place their ads directly in front of users searching for related products.

This pay-per-click (PPC) model gave affiliates a powerful way to drive targeted traffic to their offers, no longer relying solely on organic reach.

AdWords also brought real-time tracking and data-driven insights, allowing affiliates to optimize campaigns for better conversions.

Those who mastered PPC advertising gained a huge advantage, accelerating both their commissions and the overall growth of affiliate marketing.

The Rise of SEO and Social Media: A New Era for Affiliates

As the 2000s progressed, two key developments took affiliate marketing to the next level: the rise of search engine optimization (SEO) and the explosion of social media.

SEO allowed affiliates to rank higher in search engine results, driving more traffic to their websites and affiliate links.

Suddenly, being an affiliate wasn’t just about throwing up some banners and hoping for clicks—it became about strategy, content creation, and optimizing for search engines, social media and the best affiliates started adopting an omnichannel strategy utilizing everything to drive traffic.

I remember when I first started focusing on SEO; it was a complete game-changer. The more I learned about how to optimize my content, the more traffic I attracted, and the more commissions I earned.

Around the same time, social media platforms like Facebook, Twitter, and later Instagram began to emerge as powerful tools for affiliates.

Now, affiliates didn’t need a website at all—they could engage with their audience directly through social channels, promoting products in a way that felt natural and conversational.

Social media opened up a whole new world of possibilities, especially for influencers who would soon become a driving force in affiliate marketing.

Data and Analytics: The Power of Information

One of the most significant shifts I’ve seen in affiliate marketing is the increasing importance of data and analytics.

In the early days, it was hard to track exactly where your sales were coming from or how your audience was interacting with your content.

That's why MOZ launched in 2004 and SEMRUSH in 2008 & Ahrefs in 2010 and since many other have come out.

But as technology advanced, companies started using sophisticated analytics to track user behavior and optimize their affiliate marketing strategies.

Data became a goldmine for affiliates too.

Knowing what your audience wants, what content drives the most engagement, and where to place your affiliate links all became critical pieces of the puzzle.

The more we understood our audience, the more targeted and effective our marketing efforts became.

Influencer Marketing: A New Breed of Affiliate

As social media platforms grew, so did the rise of influencers. Influencers—whether they’re YouTube stars, Instagram personalities, or TikTok creators—have massive followings, and their word carries weight.

You can argue when this officially started some will say when Instagram launched in 2010 that people were influencers and promoting products then or maybe you know about Josiah Wedgwood's influencer play for his pottery business in 1760… but personally I noticed it really start to be a thing around 2015 and now in 2024 with TikTok Shop it is pretty much inescapable.

Influencers became the new generation of affiliates, promoting products to their audiences and earning commissions for every sale they helped drive.

The beauty of influencer marketing is its authenticity. People trust influencers, and when an influencer recommends a product, it feels more like a friend giving advice than a company trying to sell something.

This has led to a surge in affiliate marketing through social media channels, making it easier than ever for people to monetize their online presence.

Today and Beyond: The Future of Affiliate Marketing

Fast forward to today, and affiliate marketing is an industry worth over $12 billion globally.

It's an integral part of the digital economy, touching everything from blogs to YouTube channels to social media.

Affiliate marketing is everywhere, and it's continuing to grow.

But what’s even more exciting is the future.

With mobile commerce, artificial intelligence, and machine learning all advancing rapidly, the potential for affiliate marketing is greater than ever.

As technology evolves, so too will the ways in which we connect with audiences, promote products, and earn commissions.

The key to succeeding in affiliate marketing today is relationships.

Whether you’re working with merchants, influencers, or your audience, building trust and delivering value is the foundation of success.

So here we are 30 years after affiliate marketing was born!

Looking back at how affiliate marketing started and how it has evolved over the years, it's clear that this industry is built on innovation, resilience, and opportunity.

From William J. Tobin’s groundbreaking affiliate program to Amazon’s transformative impact, to the rise of SEO and social media, and now Artificial Intelligence affiliate marketing has come a long way.

And as someone who’s been in the game for over a decade, I can confidently say that the future is brighter than ever.

Whether you're a seasoned pro or just getting started, there’s never been a better time to be part of this incredible industry.

Affiliate marketing has changed my life, and I know it can do the same for many others.

Here’s to the next chapter in its evolution!

Thanks for reading this history lesson! I thought it was interesting so I wanted to do a post on it and I will keep this updated and add to it over time.