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CPA marketing, also known as cost per action marketing, is a style of the affiliate marketing model that offers a commission to the affiliate when a specific action is completed. The lead action can be anything from making a purchase to getting a quote, watching a video, or filling out a form. Ecommerce sites around the globe can leverage CPA marketing to create different offers and online marketing campaigns, CPA networks then promote these campaigns through affiliates, the CPA affiliates are paid a set fee each time a referred visitor completes the action or offer.
CPA marketing how cpa works
The CPA model is a simple concept once you break down into how it works and who’s involved.
Affiliate or Publisher: The influencer (blogger, brand, business) that promotes a business or product in order to drive traffic to the ecommerce site and make a specific conversion.
Business or Advertiser: The brand that desires a partnership with an affiliate to drive quality traffic to the business’ website and increase sales, generate leads, or boost conversions.
CPA Network: The platform that brings together the affiliate who wants to make money by promoting products and the businesses that want their products promoted.
CPA marketing and how affiliate marketing works
CPA network terminology isn’t complicated, but there are a few key terms you should know as you launch.
Affiliate Manager: A person who manages an affiliate program for a merchant. They are responsible for recruiting, engaging with affiliates, and generating revenue for the merchant.
Category: The niche for which the CPA offer applies (sports, fashion, beauty, health, etc).
Chargeback: When a sale “falls through” for an action an affiliate has already paid for. Since the sale was never finalized or an item was returned, the previously given commission is deducted back into the advertiser’s account.
Commission: The payment an affiliate receives—either a flat rate or percentage—once a successful conversion is tracked.
Contextual link: A text link placed within an affiliate website that links to the advertiser’s website.
Conversion rate: The percentage rate at which a particular action is performed. In other words, the number of successful conversions divided by the total traffic.
Cookies: In affiliate marketing, cookies are used to assign a unique ID to a user who has clicked the affiliate link to an advertiser’s site for a specific duration. The affiliate will receive credit for the conversion in this predefined window, typically 30-90 days.
Cost per action (CPA): An online advertising strategy that allows an advertiser to pay for a specified action from a target customer.
Earnings per click (EPC): The average amount an affiliate earns every time a user clicks an affiliate link.
Offer page: The webpage where the conversion occurs after a visitor takes the required action.
Return on investment (ROI): Refers to the amount of money made with a campaign. It is the revenue divided by the ad spend, multiplied by 100.
CPA Marketing Payment Model
The CPA affiliate marketing method is advantageous for businesses because they don’t pay unless a successful conversion is made. The payouts differ based on competition and average commission rates in each vertical. For example, headphone manufacturer Skullcandy’s successful affiliate program offers a 5% commission on sales based on a competitive electronics category. Kelty, the outdoor camping gear company, provides affiliates up to 10% on a tiered commission structure. It’s all based on the competition within your vertical. The cost per action formula is a very low-risk method for advertisers, as they only pay for the desired actions after they occur; unlike paid traffic, for example, where you just pay to get people on your site through ads. The cost per action for an advertiser can be determined by dividing the total cost of the marketing campaign by the number of successful actions taken.
CPA Networks for beginners
1. Max Bounty
2. Adworkmedia
3. CPA Grip
4. MyLead
5. Adpump
CPA marketing how cpa works
The CPA model is a simple concept once you break down into how it works and who’s involved.
Affiliate or Publisher: The influencer (blogger, brand, business) that promotes a business or product in order to drive traffic to the ecommerce site and make a specific conversion.
Business or Advertiser: The brand that desires a partnership with an affiliate to drive quality traffic to the business’ website and increase sales, generate leads, or boost conversions.
CPA Network: The platform that brings together the affiliate who wants to make money by promoting products and the businesses that want their products promoted.
CPA marketing and how affiliate marketing works
CPA network terminology isn’t complicated, but there are a few key terms you should know as you launch.
Affiliate Manager: A person who manages an affiliate program for a merchant. They are responsible for recruiting, engaging with affiliates, and generating revenue for the merchant.
Category: The niche for which the CPA offer applies (sports, fashion, beauty, health, etc).
Chargeback: When a sale “falls through” for an action an affiliate has already paid for. Since the sale was never finalized or an item was returned, the previously given commission is deducted back into the advertiser’s account.
Commission: The payment an affiliate receives—either a flat rate or percentage—once a successful conversion is tracked.
Contextual link: A text link placed within an affiliate website that links to the advertiser’s website.
Conversion rate: The percentage rate at which a particular action is performed. In other words, the number of successful conversions divided by the total traffic.
Cookies: In affiliate marketing, cookies are used to assign a unique ID to a user who has clicked the affiliate link to an advertiser’s site for a specific duration. The affiliate will receive credit for the conversion in this predefined window, typically 30-90 days.
Cost per action (CPA): An online advertising strategy that allows an advertiser to pay for a specified action from a target customer.
Earnings per click (EPC): The average amount an affiliate earns every time a user clicks an affiliate link.
Offer page: The webpage where the conversion occurs after a visitor takes the required action.
Return on investment (ROI): Refers to the amount of money made with a campaign. It is the revenue divided by the ad spend, multiplied by 100.
CPA Marketing Payment Model
The CPA affiliate marketing method is advantageous for businesses because they don’t pay unless a successful conversion is made. The payouts differ based on competition and average commission rates in each vertical. For example, headphone manufacturer Skullcandy’s successful affiliate program offers a 5% commission on sales based on a competitive electronics category. Kelty, the outdoor camping gear company, provides affiliates up to 10% on a tiered commission structure. It’s all based on the competition within your vertical. The cost per action formula is a very low-risk method for advertisers, as they only pay for the desired actions after they occur; unlike paid traffic, for example, where you just pay to get people on your site through ads. The cost per action for an advertiser can be determined by dividing the total cost of the marketing campaign by the number of successful actions taken.
CPA Networks for beginners
1. Max Bounty
2. Adworkmedia
3. CPA Grip
4. MyLead
5. Adpump
