Affiliate Marketing Terminologies

As an affiliate marketer, you always come across affiliate marketing terminologies, definitions, and jargons that are alien to you. To be a successful affiliate and to make money from affiliate marketing, you should understand all the basic terms that are used in the industry.

Above the Fold: The portion of the website that is viewable without the need of scrolling down the page. This term is considered significant due to the reason that the content above the fold is thought to be extra important as it is the first thing the reader gets to see. The content above the fold should be catchy and must grab the attention of the reader. The size of above the fold portion is dependent on the user’s computer resolution.

Affiliate: The affiliate marketer who gets a commission for generating sales, leads or in some cases clicks to a merchant’s product.

Affiliate Agreement: The terms that took place between the merchant and the affiliate to make the relationship stronger between both. The affiliate agreement usually states commission details, promotion rules, advertising restrictions, and other legal aspects.

Affiliate Information Page: The page that explains the terms of the affiliate program to the affiliates. It includes affiliate agreement, commission rates, advertising material, contest details, product launch details, product details, and any other details about the product or the merchant.

Affiliate Link: The unique link that is used for tracking the traffic (and other details) that comes from the affiliate’s website/blog. Affiliate link is generated by the affiliate network.

Affiliate Manager: The person in charge of running the affiliate program of the merchant. He manages affiliates, incentive programs, creating affiliates’ media, managing reports of sales and the payment of the affiliates.

Affiliate program: The program that merchant uses to recruit affiliates. When a merchant involves in affiliate marketing and offers its products for affiliates to promote, the entire process is known as affiliate program.

Affiliate Program Directory: The directory containing the list of all the merchants’ affiliate programs. All the affiliate programs are categorized industry-wise. Affiliates can search affiliate programs of their choice easily from the directory.

Affiliate Software: This is the key technology that carries out every single affiliate program. It helps in managing and running the affiliate program. This software usually carries out all the functions ranging from signing up of affiliates to tracking impressions, clicks, sales, leads, to managing of links.

Affiliate Tracking: The procedure of tracking a link by an affiliate through an Affiliate Link.

Associate: Another term commonly used for the affiliate.

Auto-Approve: Affiliate application procedure in which all the applications are accepted at the exact moment as soon as they are submitted by the affiliates. This term is commonly used to explain the process of accepting all the sales made by the affiliates automatically.

Average Order Value (AOV): A metric that portrays the average value of a purchase, which is calculated by dividing the number of orders to the total cost of orders at a specific time.

Banner Ad: It is an electronic billboard or advertisement that could be of any animated Flash Movie, GIF, or JPEG format, which is used to promote a website, service, or product.

Browser: A client program (software) for example, Opera, Netscape, or Internet Explorer which is used to give a view of different types of the internet resources.

Business to Business (B2B): A process of trading services or products or a transaction is made between the businesses, instead of between a consumer and a business.

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Business to Consumer (B2C): A process of trading services or products or a transaction is made between a consumer and a business instead of between two businesses.

Charge Back: A worthless sale of which no commission is given to the affiliate. In all those cases where the affiliate product is returned or if customer requests for a refund, the merchant (or the affiliate network) will deduct the amount of (already paid) commission paid for the sale (or lead). This deduction of funds is known as a charge back.

Click-Through: The action performed by a user by clicking on a link and following it all the way to the website of the merchant. Generally, click through refers to clicking on the link.

Click-Through Rate (CTR): The number of visitors who click-through on a link as compared to the number of people who actually viewed your link. CTR is the difference between the impressions your link received to the clicks it received. It is a percentage and is obtained by dividing number of clicks on the link by the number of impressions it has received. The result is multiplied by 100 to convert the it into a percentage.

Co-Branding: Some merchants create special landing pages for special affiliates where the merchant and affiliate both add their brand names (logo and design). This is used to increase the sales (leads) by increasing trust factor.

Commission: The amount of money an affiliate makes by making a lead or sale. It is often called a finder’s fee, a bounty or referral fee.

Conversion Rate: The percentage of the clicks which results in a commissionable action (sale or lead). The conversion rate is obtained by dividing the total number of clicks an affiliate link has generated by the total number of sales. The result is multiplied by 100 to obtain the conversion rate.

Cookie: A file that is stored by a user’s web browser and is used to track non-personal information such as user’s IP address, browsing history etc. Affiliate networks have different cookie lives and based on the life of a cookie, the sales are credited to the right affiliates.

A cookie having a 30 day life means that the user has 30 days to buy the product after clicking the affiliate link for the first time. If a user purchases the product within 30 days, the sale will be credited to the same affiliate.

A cookie assigns a unique ID to every user as soon as he clicks an affiliate link for the very first time. This ID is used to track the user’s activity and to credit sales to the right affiliate.

CPA (Cost per Action): The commission given to the affiliate for every action completed by his/her referrals.

CPC (Cost per Click): The rate of a single click paid by the affiliate or the merchant.

CPM (Cost per Mile): The rate of one thousand miles or impressions.

CPO (Cost per Order): Just like CPA but is more specifically used for sales.

Customer Bounty: The fees paid to the affiliate for referring new customers to the merchant’s website. It is also known as commission.

Direct Linking: When an affiliate sends all the traffic directly to the merchant’s website instead of his/her own website, it is known as direct linking. Most of the affiliates send traffic to their own landing page while others direct link to the merchant’s landing page.

EPC (Earnings Per click): It gives the average earnings per hundred clicks. A relative way of rating that explains the ability to convert clicks into commission.

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Impression: The number of times a banner or a link or a promotional material was viewed.

Landing page: A web page where all the first-time visitors land. For websites, it is normally the homepage where all the new visitors land and for product sellers, it is normally the sales page.

Multiple Tiers: This term explains the running of the multiple tier affiliate program in which one affiliate earns a commission for the sales made by other affiliates in his/her down-line.

Manual Approval: The procedure of authorizing an affiliate application and later on approving them after validation. This can also be described as the process of approving sales once they have been validated.

Merchant: The person or the business selling the services or the products is the merchant. The merchant pays the commission to the affiliates for referring traffic to his website for buying goods or services.

Performance-Based Marketing: A type of marketing where the affiliate is given commission only for the number of sales or leads he makes. The earnings are based on the performance.

Residual Earnings: The commission that’s paid to the affiliate on all the future purchases of the customers he has referred.

Spider Detection: The process carried out to detect and ignore the automated bots or spiders such as Googlebot.

Squeeze Page: A type of landing page which is used to grab the email address of the visitors. Affiliates send traffic to their own squeeze page and then from the squeeze page, the traffic is sent to the merchant’s sales page.

Super Affiliates: The top performing affiliates who generate the highest number of sales. Super affiliates are less than 1%, but they bring nearly more than 90% sales to the merchant.

Targeted Marketing: The perfect offer given to the right customers at the right time.

Tracking Method: The method used for tracking sales, clicks and leads. The most basic way to do the tracking is through one of a kind web address (URL) for every single affiliate or by setting an affiliate ID number into the link that is checked by the software.

Text Link: A type of link that has no graphical images included.

Tracking Code: It is a hidden 1×1 pixel tracking code situated on the confirmation page of the merchant’s website for keeping track of sales and conversions.

Two-Tier: A type of affiliate marketing in which affiliates are allowed to hire more affiliates below themselves. This way, when the second tier affiliate earns a commission the affiliate above also gets a cut of the commission.

Unique Click: The procedure of only taking unique clicks into account from every single person visiting the website. The unique clicks are tracked by keeping a record of browser header and the IP addresses.

The affiliate marketing is just like recruiting the right guy for the job so no particular terms and conditions can be stated on a general basis because every single merchant requires a specific affiliate for the job. The terms and conditions vary from merchant to merchant and from affiliate network to affiliate network, so no particular affiliate marketing terminologies can be stated. These were some of the most common and general affiliate marketing terms and definitions.

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