As you may know, the industry of affiliate marketing has four basic pillars: the advertisers, the networks, the publishers and the customers. Although it sounds quite obvious at first glance, the truth is, sometimes in can be confusing over who is who, so let’s break it down.
Also known as merchants, retailers or brands, the advertisers are the sellers of the products or services. They use affiliate marketing to promote their merchandise and create brand awareness. This promotion is carried out by publishers that own websites related with the advertiser’s products or services. Advertisers can work directly with publishers or do it through a network.
The networks or affiliate networks are intermediaries between advertisers and publishers. Although they might seem unnecessary, networks are usually the key both for advertisers and publishers to easily find themselves. Given the amount of websites there are nowadays, it sounds almost impossible for an advertiser to find the correct place to promote its products. The networks find suitable websites for the advertisers, and encourage publishers to promote products or services related with their website.
Almost any website can become a publisher. Publishers create online contents, and provide Internet users with information about any topic of interest. Publishers promote advertisers products or services in their own website. Although the way publishers benefit from these promotions may vary, the most common way of earning money as a publisher is by commissioning the sales the advertiser’s make through their websites.
Finally, customers are visitors that end up acquiring products or services provided by advertisers, that are being promoted in the publishers websites.
Below are some of the most common terms you will come across in affiliate marketing, so it’s handy to what they all mean!
An affiliate (sometimes referred to as a publisher or associate)
publishes information, content, creatives and offers from a merchant
or advertiser on their website in return for a form of remuneration,
usually a commission on leads or sales the refer to the merchant
An affiliate network acts as an intermediary between merchants and
affiliates and provides the tracking platform technology to enable
data to be collected via a tracked link. Networks liaise between
merchants and affiliates to ensure that promotion of the merchant is
meeting the terms and conditions set by them. They also provide a web
interface allowing affiliates and merchants to track the activity of
tracked links. Payments to affiliates also go via affiliate networks.
An affiliate program is a structure that a merchant has put in place
in order to promote their product or service. It can include information
on a remuneration package for affiliates and creatives for affiliates to
display on their sites and usually is specific to a particular product
enabling merchants to have multiple affiliate programmes.
Auto Approval Process
This can refer to either the approval process that a merchant uses
when an affiliate applies to a program in order to request permission to
refer traffic to a merchant in return for commission. It can also refer
to the auto approval of commissions once an affiliate has been accepted
onto a program. Commissions can occasionally be auto approved for any
transactions/leads referred by the affiliate, depending on the situation
and preference of the merchant.
A web banner is an advert that is placed on a webpage and there are
varying types and sizes of advert. We have created information on the
most commonly used banner
advert sizes and names Banner adverts can come in various file
This is the software used to view webpages. Examples of web browsers
include Internet Explorer, Chrome, Firefox, Safari and Opera.
Click Through Rate (CTR)
The click through rate compares the amount of visitors that are
visiting an affiliate webpage to the amount that are actually performing
the desired action of clicking on a merchant’s link/creative. This is
displayed as a percentage and is a good way to measure how well the
affiliate is converting their traffic. It can be used in conjunction
with CR to assess where visitors are being lost.
To increase trust in brands, some merchants will work with affiliates
to provide co-branded (displaying both brands) landing pages which
visitors are directed to from the affiliate site. An example would be
using copy such as “Affiliate_A in partnership with Merchant_A”.
Commission is the term used to refer to the income an affiliate makes
on producing a desired action for a merchant. This can cover many
actions, but is generally either a sale, lead, sign-up/subscriber or
click. This may also be referred to as a referral fee or a bounty.
Conversion Rate (CR)
This is a metric used for assessing how well a program is performing
between an affiliate and a merchant. The conversion rate can refer to
the conversion of many things, but is most commonly used to show the
amount of visitors or traffic that is being converted from a click on
the affiliate site to a sale for the merchant. This is shown as a
percentage and is a great way to measure the effectiveness of changes to
page design/promotion/content/campaign used by either party.
Cookies are small text files that are stored on the visitor’s browser
and are used to enable effective tracking of the visitor’s actions on
the affiliate and merchant sites. They allow tracking of the affiliate
webpage visited, the link/creative clicked, the date/time the visitor
clicked and was converted and the actions they performed.
The cookie period or cookie expiration refers to the amount of time
that the browser will store cookies for, which is defined by the
merchant. Anything occurring outside of this expiration date will not be
tracked back to the affiliate’s referral and so the affiliate will not
be paid on transactions occurring after the cookie expiration.
Cost Per Acquisition (CPA)
Sometimes referred to as “Cost Per Action”, this is a measurement of
the amount paid by a merchant to an affiliate for each desired action
completed by a visitor. This is usually in the form of a sale or a lead
Cost Per Click (CPC)
CPC refers to the cost that an advertiser pays for every click on
their tracked link. This is commonly used when advertising through ad
systems like Google Adwords but can also be used in affiliate marketing,
although is a less popular metric as most affiliate marketing is based
on being remunerated for an action which produces a more definite
revenue for the advertiser, rather than a click, which while valuable is
not an absolute measurement of revenue derived.
Cost Per Day (CPD)
This is another way of charging for advertising. This method is not
so popular any more and tends to be used for display advertising rather
than advertising on an affiliate/commission basis.
Cost Per Mille (CPM)
CPM translated means “Cost Per Thousand Impressions” and is a metric
often used for an advertiser to pay for display advertising, the aim of
which is more along the lines of creating a brand awareness. A page
impression is counted every time a page is loaded in a web users
A creative is a general term referring to the image/media file
displayed on an affiliate webpage. This can include banners, videos and
rich media files such as interactive “rollover” adverts or adverts using
sound, video or animation to grab the visitors attention. It can also
include text links and logos/standard images.
A deep link is an affiliate link which directs the visitor to a
webpage “deep” within the merchant site and is often used to increase
conversions by decreasing the click journey made by the visitor and
increasing the relevancy depending on what product or service the
affiliate is recommending. It essentially directs a visitor to any page
other than the homepage.
Earnings Per Click (EPC)
This is a commonly used metric for working out how much commission is
payable to an affiliate for each click that has been performed on their
tracked link. It can also sometimes be used to show how much a merchant
has generated in revenue for each click that an affiliate has referred
Effective Cost Per Mille (eCPM)
Translated this means “Effective Cost Per Thousand Impressions”
Essentially it is a measure of what would be earned per thousand
impressions but is used in place of CPM when CPM cannot be worked out
for any reason. This can include a situation when 1000 impressions have
not been served but you want to work out which ad you are using is most
profitable from an impression basis.
Manual Approval Process
this can either refer to the approval process employed by the
merchant when deciding whether to accept an affiliate onto their
affiliate program. Many merchants like to manually check the affiliate
site is a good match for their product or service before acceptance. It
can also refer to the manual approval of transactions or actions before
commission is approved for payment to the affiliate.
Also referred to as an advertiser, a merchant promotes their products
and services through an Affiliate’s or Publisher’s website via a
tracking link. The merchant pays or remunerates the affiliate for this
promotion usually in the form of commission for sales or leads sent via
the affiliate site.
A performance incentive is given to affiliates occasionally by
merchants to encourage the affiliate to push the merchant’s products,
services or site more effectively. This can take on any form of
incentive but common methods will be prizes for extra sales, or tiered
commission structures which usually define a target transaction or
transaction value to be met in order to receive extra “bonus”
commissions, often for a limited time.
The process of pre-qualifying a visitor is a way of the affiliate
trying to make sure that the potential customer they are targeting with
their promotions is as likely as possible to perform the required action
for the merchant. There are many methods of pre-qualifying customers,
and these will often be based around combining targeted marketing with
as much relevant information as possible about the merchant’s product or
service, and trust in the affiliate site, information and opinions.
Merchants may sometimes choose to reward affiliates on a recurring
basis, where the product or service the affiliate has promoted charges
the customer on a recurring basis. This will usually be done by
rewarding the affiliate with a percentage of the customer’s regular fee.
The term super affiliate refers to the best performing affiliates. It
can expected that around 1% of all affiliates are super affiliates, and
typically that 1% will bring in around 90% of a merchants sales.
This term refers to targeting a marketing campaign to make it as
effective as possible. In short, it is the best way to makes sales and
requires bringing together the right product/service, at the right time,
and making the right potential customer aware of it.
Sometimes referred to as a “tracking link”, “affiliate link” or
sometimes “text link”, a tracked link is a clickable link which is most
usually placed on a publisher’s webpage and directs traffic through to a
merchant’s webpage where an action is likely to be performed in return
for commission to the referring publisher site. The tracked link’s
origin is traceable using various parameters added to the HTML code in
Two Tier Program
This term can refer to a program that allows affiliates to recruit
their own affiliates who allow the original affiliate to make commission
on their own promotions as well as a percentage of the actions the
recruited affiliate makes. This is also known as Multi-level marketing
Refers to the rapid adoption of a product or service through word of
mouth, email or via social networks. Often beginning with an inventive
way of making people aware of something as quickly as possible by doing
something “a little bit different” which encourages a branching out or
spreading of the word in the same way a virus would spread rapidly. This
is usually a very cheap way for advertisers to promote themselves or
their products, but hard to instigate if creative ideas don’t flow