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Affiliate marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate’s own marketing efforts.
Affiliate marketing is an online sales tactic that lets a product owner increase sales by allowing others targeting the same audience – “affiliates” – to earn a commission by recommending the product to others. At the same time, it makes it possible for affiliates to earn money on product sales without creating products of their own.
The cost to the customer purchasing the product or service through an affiliate is the same as buying directly from the product owner.
CPA (Cost Per Action)
Online advertising payment model in which payment is based solely on qualifying actions such as sales or registrations.
Marketers looking for cost-per-action deals have several options. Publishers with considerable excess inventory may be willing to consider nonstandard offers. Sites specializing in incentive programs are in a position to offer CPA pricing on various types of leads, although the usual caveats concerning incentive traffic still apply. Perhaps the most widespread use of performance-based pricing is affiliate marketing, whereby merchants/advertisers determine what actions they want to reward and how much they are willing to pay.
CPL (Cost Per Lead)
Cost per lead (CPL) is one form of performance-based adverting. In some ways, it’s a middle ground between online advertising models like cost per impression (CPM) where a publisher is not directly rewarded or punished tied to how that traffic performs, and cost per sale where the publisher bears complete responsibility for how that traffic converts… even though they can’t control everything that happens on the advertiser’s site.
Unlike cost per sale, the company generating the leads doesn’t have their compensated directly to the sales conversion of those leads. However, for an advertiser to keep paying for leads from the same source, the leads ultimately must produce an acceptable conversion rate.
CPL (Cost Per Lead)
The CPM model refers to advertising bought on the basis of impression. This is in contrast to the various types of pay-for-performance advertising, whereby payment is only triggered by a mutually agreed upon activity (i.e. click-through, lead, sale).
The total price paid in a CPM deal is calculated by multiplying the CPM rate by the number of CPM units. For example, one million impressions at $10 CPM equals a $10,000 total price.