When you decide to monetize your Web site by becoming an affiliate marketer, there are a few key terms you should be familiar with in order to avoid the pitfalls of the practice. Affiliate marketing can be worthwhile, but only if you learn the terminology and avoid the confusion before you start.
Here are some of the most common affiliate marketing terms you should know:
Above the Fold: The section of a Web site a user sees when he or she first lands on it, without having to scroll. This is prime space for affiliate ads.
Affiliate: An individual who promotes products or services for an advertiser (also known as a merchant) in exchange for receiving compensation for the sales or leads they drive to the advertiser’s site.
Affiliate Agreement: The agreement between the advertiser and the affiliate regarding the affiliate relationship. It usually defines the roles, rules, and responsibilities of the relationship on both sides.
Affiliate Code: A unique code or link that is provided to the affiliate in order to better track the business results directly generated from the affiliate’s marketing efforts. It is important for merchants who have multiple affiliate partners to implement this, as it becomes easier to track which affiliate networks are the most profitable for them.
Adware: Also referred to as “spyware, adware is usually included in free computer programs users download without realizing that adware is also part of the package. In many cases, the advertisements are unwanted and difficult to get rid of, even after uninstalling the program. Most advertisers will not work with affiliates who want to promote their offers via adware.
Conversion Rate: This is the percentage of customers who take an action that will result in earning a commission for you. This can happen from clicking on a banner, entering a lead, or actually making a purchase. Increasing the conversion rate is one of the primary objectives of affiliate marketing.
Cookies: Cookies are tiny text files that are captured on the customers’ computers, which contain vital information for the company. For an affiliate marketer, cookies are important because they not only link back to the referring site, they also track the time of entering a lead or clicking on a banner, to learn more about the time it takes them to convert to real customers.
Cost Per Click/Cost Per Action: These are the terms of measurement of the cost of your marketing efforts. Cost per click refers to the amount of money that is invested every time the customer clicks on a particular link; cost per action means the amount of cost for a customer’s action, such as making a purchase or entering a lead.
There are many more terms associated with affiliate marketing, but these are certainly the most common. If you still have questions, or are hesitant to take part in an affiliate marketing program, contact the merchant about your concerns. If the merchant is reputable, he or she will address your concerns and give you the answers you need to make an informed decision. At Coggno, we invite all our customers to consider joining our affiliate program, and encourage all of them to contact us with any questions or concerns. Remember, affiliate marketing is a two-way street that benefits both parties. If the merchant makes money, you will also get your share.