A Guide to Beating Affiliate Marketing Jargon
Most affiliate programs employ obscure acronyms and other marketing jargon. Different merchants use a variety of words with similar meanings. To fully comprehend how these programs work, it’s important to understand affiliate marketing jargon. It can also help people compare programs and maximize their earnings.
Affiliate: When people sign up as members of a revenue sharing program, they become affiliates. They can earn cash by referring sales or leads to a merchant. Department stores have different names for employees. Likewise, some affiliate programs call their members “associates” or “partners.”
Affiliate link: Affiliate programs provide special links that members can use to send potential customers to merchants’ websites. A few programs call them “referral links” or “tracking URLs.” Marketers can place them on Web pages or in email messages. Some programs supply links in the form of graphical buttons or banners.
Affiliate network: Many merchants pay external networks to set up and maintain their affiliate programs. These networks handle user registration, tracking, payments and other complex tasks. Commission Junction is the largest company of this type, according to Pubcon. Other major networks include LinkShare and ClickBank.
Commission: A commission is the portion of a sale that a merchant pays an affiliate. Some companies offer recurring or residual commissions that affiliates earn when customers subscribe to monthly services. Other merchants pay lifetime commissions. They reward the affiliate for all future purchases made by a customer.
Conversion: When a potential buyer becomes a paying customer, a conversion has occurred. To find the conversion rate, an affiliate can divide the quantity of sales by the number of clicks.
CPA: Cost-per-action affiliate programs pay associates when they generate leads or sales.
CPC: Cost-per-click and pay-per-click programs pay members when potential customers click their affiliate links.
CTR: The click-through rate indicates the percentage of visitors who click an affiliate link or banner.
Earnings per click: The EPC is the average amount of revenue that affiliates earn from each 100 clicks on a referral link. However, some affiliate programs and networks use this term in a different way. It may indicate the average earnings derived from a single click.
Lead: When they hear this word, some people think of a lead in a detective story. A lead is a clue that may or may not solve the mystery. It can also be an action that might result in a sale. For example, a lead is generated when someone requests a home insurance quote. Some merchants operate cost-per-action or pay-per-lead affiliate programs that pay members for every lead.
Merchant: Any company that sells products or services is a merchant. An affiliate program may be operated by a specific merchant, an affiliate network or a merchant’s parent company.
Minimum payment: Most merchants require affiliates to earn a certain amount of money before they can request payments. Affiliate programs use various names for this requirement, such as “minimum payout” or “payment threshold.” Minimum payments typically range from £10 to £100.
PPL: Pay-per-lead affiliate programs reward members for generating leads. For example, some merchants pay affiliates when people sign up for newsletters or enter to win prizes.
PPS: Pay-per-sale and cost-per-sale programs pay commissions to members when they sell products through their affiliate links.
Super affiliate: The most effective marketers are known as super affiliates. They initiate the majority of sales. Some merchants reward them with higher commissions and other performance incentives. People often reach this level of achievement by using email newsletters, article marketing and search engine advertising, according to SiteProNews.
Tier: Some affiliate programs have two or more tiers. They reward members for referring new affiliates who succeed in selling products or services. For example, perhaps a merchant decides to pay a 12 percent commission on the second tier. If Emily convinces Bob to become an affiliate and he sells £450 worth of products, she will earn £54.
Tracking cookie: Many merchants store cookies on visitors’ computers. Perhaps Joe browses Sarah’s website and clicks an affiliate link for a book store. He doesn’t buy a book, but a tracking cookie is placed on his PC. Joe directly visits the store’s website a few days later and orders a paperback. The cookie identifies him and Sarah earns a commission.
Please bookmark or print this guide for future reference. It will come in handy the next time you encounter affiliate marketing jargon.
2. SiteProNews, http://www.sitepronews.com/2011/01/03/super-affiliates-5-characteristics/