30 Basic Affiliate Marketing Terms You Need to Know
When first starting off into the Internet marketing world and affiliate marketing in particular, it is easy to get lost with the overwhelming abbreviations and glossary used in this industry.
Are you new to affiliate marketing?
Have you found difficulty facing tons of obscure terminologies?
Don’t worry! Here we have listed 30 must-know affiliate marketing terms for everyone to have a quick overview of this challenging industry.
Let’s get started!
30 Must-know Affiliate Marketing Terms
The company or the individual that has products or services to be promoted. It is also referred to as the Merchant.
An individual or organization that promotes the advertiser’s products or services in exchange for commissions. Broadly speaking, it includes publishers, media buyers or affiliate networks.
A marketing model that features revenue sharing. Affiliates who recommend or refer people to the advertiser’s products or services will get compensation based on a predefined desired outcome.
The third party between advertisers and affiliates. Acts as an intermediary, affiliate networks help each side earn more while saving more time. It streamlines workflows including tracking, payment, reporting, etc. In return, it makes its profit from the difference between the advertisers’ revenue and their payment to affiliates.
A program offered by an advertiser to allow affiliates to generate traffic or leads to their products and services with commission fees as a reward. See my post on Everything about starting an affiliate program for additional information.
Sometimes it is also called campaign. It can pertain to a specific product or service itself, or it can refer to the entire affiliate program.
The number of times a given ad/ affiliate link is shown on a page.
A specific desired action of the end-user that is predefined by the advertiser. It could be getting a sale, lead, subscription or whatever the intended goal may be. Conversion is the primary goal of advertising for which affiliates get payouts from advertisers.
Click-through Rate (CTR)
A metric shows the number of times people click your affiliate links versus the number of times people view your link (impression), displayed as a percentage.
CTR = Conversions / Impressions
Conversion Rate (CR)
The Percentage that the number of times your affiliate links result in conversions compared to the total number of clicks on the links.
The average revenue earned per click on your affiliate link. It indicates the profit potential of an affiliate program.
EPC = Total commission earned/ Total clicks on the link
Cost Per Action/Acquisition. A payment model in which advertisers pay affiliates only for conversions.
Cost Per Thousand (the M is the Roman numeral abbreviation for 1,000). This is when advertisers pay for every thousand views of the ad.
Cost Per Click. A most common payment model in which an advertiser pays when a click is made on the ad.
Cost Per Lead. A lead refers to a potential customer trying to learn more about a product or service. It can be an inquiry, an e-mail address, or a completed contact form.
Cost Per Sale. A payment model in which advertisers pay affiliates when a potential client actually makes a purchase.
Cost Per View. A payment model in which advertisers pay affiliates when your affiliate link or ads get one view or impression.
In affiliate marketing, cookies are applied to track and identify a user who has clicked the affiliate link at any given time by giving a unique ID to each one. Cookies refer to a specific period of time. During this period, affiliates will receive a credit once a users make a conversion.
Also called tracking link. It is a unique link for affiliates to refer visitors to the advertiser’s site. With a specific affiliate ID included in the link, the affiliate network is able to track the source of each click.
Also referred to as callbacks, server-to-server (S2S) or cookie-less conversion tracking. An alternative to tracking pixels. It allows advertisers and affiliate networks to send and attribute conversions to affiliates.
An HTML code snippet that is loaded when a user visits a website or opens an email. It is used to determine the source of conversion and then allocate a fee.
It refers to a place or platform where you can purchase traffic.
ß The first webpage on which the referred affiliate traffic lands.
Two Tier Program
A program that allows affiliates to recruit their own affiliates through sharing their commission. This is also known as Multi-level marketing (MLM).
An individual visitor is counted as one visitor over a specific period, no matter how many times they visited the website during that time.
It represents the total number of times a link is clicked on by an individual or unique user. It only counts additional clicks while the different users click on the link.
Performance Marketing Software
Software used by affiliate networks to better track, manage and optimize ad campaigns, such as Offerslook.
It refers to the tracking systems used by affiliates in general.
A data-based function used by affiliate tracking software. It is used to offer the conversion path and identify which affiliates are driving conversions.
A notice or page on your site aiming to let your visitors be aware that you are getting paid from the affiliate program.
Understanding the above affiliate marketing terms is the very first step into the affiliate marketing world. Hope this post could help you save more time on figuring out these concepts.
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