If you’re new to affiliate marketing, the terminology can feel a little like learning a new language. Words like “CPA” or “Cookie Duration” might make you scratch your head at first, but fear not! This glossary is here to break down the most important terms, helping you feel more confident as you start your affiliate marketing journey.
Let’s get right into it!
1. Affiliate
An affiliate is a person (or sometimes a business) who promotes a product or service on behalf of a brand. When someone buys through their unique link, the affiliate earns a commission. Think of it as getting paid for spreading the word about something you genuinely love.
2. Commission
When you, as an affiliate, successfully drive a sale or complete another specific action (like getting someone to sign up), the brand rewards you with a payment. This payment is called a commission, and it’s often a percentage of the sale price or a flat fee.
3. Conversion Rate
The conversion rate measures how many people complete the desired action (like making a purchase or signing up) compared to how many actually clicked on your affiliate link. For example, if 100 people click your link and 5 make a purchase, your conversion rate is 5%. It’s an important metric to track your success.
4. Cookie Duration
Cookies in affiliate marketing aren’t the kind you eat—they’re small pieces of data stored in someone’s browser when they click your affiliate link. Cookie duration refers to how long that cookie stays active. For example, if the cookie duration is 30 days, you’ll earn a commission as long as the person makes a purchase within 30 days of clicking your link.
5. Pay-Per-Click (PPC)
PPC is a type of advertising where you pay for every click on your ad, regardless of whether the person makes a purchase. Affiliates sometimes use this as a way to bring traffic to their links, though it requires careful budgeting and strategy.
6. Cost-Per-Click (CPC)
CPC is the amount you pay for each click in a PPC campaign. If your ad gets 50 clicks and you’re paying $0.50 per click, your total cost would be $25. For affiliates, keeping your CPC low and your conversion rate high is key to staying profitable.
7. Cost-Per-Acquisition (CPA)
CPA is a payment model where you earn a commission for every acquisition—or action—that’s completed as a result of your efforts. This action could be a sale, a lead sign-up, or even a free trial signup. Brands love this model because they only pay for real results.
8. Affiliate Network
An affiliate network connects affiliates with brands that offer affiliate programs. It acts as the middleman, providing affiliates with products to promote, tracking technology, and even payment processing. Examples of popular affiliate networks include ShareASale, ClickBank, and CJ Affiliate.
9. Tracking Link
A tracking link is a unique URL assigned to you as an affiliate. This is how brands know that a sale or action came from your efforts. Each time someone clicks your tracking link, data about their activity (such as clicks, purchases, etc.) is recorded, ensuring you get credit for your work.
Final Thoughts
Affiliate marketing can be overwhelming at first, but understanding the basic terms is a huge step toward feeling confident and starting on the right foot. With these key concepts in your toolbox, you’ll be well-equipped to explore opportunities, connect with brands, and build your affiliate marketing empire.
Happy learning—and happy earning! If you have any other affiliate marketing terms you’d like explained, drop them in the comments below!