What advertisers pay publishers for
What we call CPA (Cost Per Action) is a payment model. Thus, it reflects what a publisher can get paid for. The publisher's task is to motivate a user to perform a specific action (sometimes called target action) on the advertiser's website. This is what the publisher is rewarded for. Different affiliate programs may define different target actions:
1. CPS (Cost per Sale)
A target action here is a purchase made by a user. It includes them making an order, paying, receiving the goods, and not returning within the return period. Most common among online stores distributing specific goods. If a reward is a purchase amount interest, the publisher gets the share of the cart amount (rather than of the cost of one product they promoted). For instance, the publisher promoted a new lash mascara, but a user also bought a powder on the advertiser's website. Therefore, the publisher will get a percentage of the overall purchase amount rather than of the mascara's cost.
2. CPL (Cost per Lead)
A lead is also called a registration. Under this model, a target action is a user leaving their contact details. A registration must be qualified — i.e. a user needs to pay for the services or have an intent to do so. Popular among online services (e.g. language courses) or finance offers (e.g. loan applications, card issue).
3. CPI (Cost per Install)
Used in mobile programs: an advertiser pays for every user who installs the advertiser's app. The model implies every user is qualified. To verify client qualification, the advertiser monitors how many times the user interacted with the app after installation.
4. CPP (Cost per Player)
This model is used by online games: a reward is paid for every user having signed up to the game. An active player is a qualified player: the advertiser monitors how often the user enters the game after installation and what they do.
5. CPC (Cost per Click)
An advertiser pays for every visit. Popular among media resources aiming at increasing website traffic. Rarely used in affiliate marketing.
6. CPM (Cost per Mille)
An advertiser pays for every thousand banner impressions (such a banner may lead to the advertiser's store or service). Rarely used in affiliate marketing.
The key condition of all payment models used in affiliate marketing is a performed action or confirmed intent to perform an action
A confirmed action in CPS, a purchase, can only be considered confirmed if a customer has paid for a product or service, received it, and didn't return it (thus, the advertiser has received their income and closed the order).
A confirmed intent to make an order in CPL is what qualifies a customer who can be a buyer but this conversion may take some time. Such a request is called qualified in CPL (e.g. if a person has filled out the card issue form or confirmed their intention when talking to a bank manager). The same goes for mobile app installs and sign-ups to online games. A user needs to perform target actions (e.g. reach a specific level or get back to the app within a week). All these measures help prevent publishers from faking actions with the use of bots — setting them up for real customers.
A confirmed intent to make an order in CPL is what qualifies a customer who can be a buyer but this conversion may take some time. Such a request is called qualified in CPL (e.g. if a person has filled out the card issue form or confirmed their intention when talking to a bank manager). The same goes for mobile app installs and sign-ups to online games. A user needs to perform target actions (e.g. reach a specific level or get back to the app within a week). All these measures help prevent publishers from faking actions with the use of bots — setting them up for real customers.
Check yourself!
Find out if you have learned everything correctly
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For a publisher to get rewarded under the CPS model, a user needs to (multiple choice possible):
Right! For a publisher to get a reward, all three conditions must be fulfilled.
Right! For a publisher to get a reward, all three conditions must be fulfilled.
Right! For a publisher to get a reward, all three conditions must be fulfilled.
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Which payment model is used in affiliate marketing rarer than others?
Wrong! CPM is least used as just ad impressions cannot guarantee high traffic or sales.
Wrong! CPM is least used as just ad impressions cannot guarantee high traffic or sales.
Right! CPM is least used as just ad impressions cannot guarantee high traffic or sales.
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What does "an active player" mean in online games in the context of affiliate marketing?
Wrong! A player needs to sign up to a game and perform a simple target action as set by the advertiser.
Bingo! A player needs to sign up to a game and perform a simple target action as set by the advertiser.
Wrong! A player needs to sign up to a game and perform a simple target action as set by the advertiser.
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From which amount will the reward be calculated under the CPS model if the advertiser has set the rate of N%?
Correct! A publisher will get a percentage of the overall purchase amount, even the purchase didn't include the specific product promoted by the publisher. The key is that the publisher leads a customer to the advertiser's website and the customer makes a purchase.
Incorrect! A publisher will get a percentage of the overall purchase amount, even the purchase didn't include the specific product promoted by the publisher. The key is that the publisher leads a customer to the advertiser's website and the customer makes a purchase.
Incorrect! A publisher will get a percentage of the overall purchase amount, even the purchase didn't include the specific product promoted by the publisher. The key is that the publisher leads a customer to the advertiser's website and the customer makes a purchase.
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Which model do financial programs use the most?
Wrong! Most often, financial programs work under the CPL model.
Correct! Most often, financial programs work under the CPL model.
Wrong! Most often, financial programs work under the CPL model.
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You might have been distracted when reading the text. Brew some coffee, relax, dismiss everything unwanted from your mind, and try again.
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Fair take-off. Get back to those questions where you made a mistake, and then proceed to the next lesson.
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Well done!
Lesson accomplished. Let's move further!
Lesson accomplished. Let's move further!
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