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Affiliate Marketing Fundamentals
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Affiliate Marketing
A performance-based marketing strategy where a business rewards affiliates for each customer brought by the affiliate's own marketing efforts.
Affiliate
A person or company that promotes products or services for a business in exchange for commission on resulting sales.
Affiliate Network
A platform that connects merchants with affiliates, providing tracking technology and often handling payment and reporting.
Commission
The earned amount paid to an affiliate based on a predefined rate or percentage for sales or leads generated.
Conversion Rate
The percentage of visitors who take a desired action, crucial for determining the success of affiliate marketing efforts.
Cost Per Action (CPA)
A pricing model where the advertiser pays for a specific action, such as a sale or a form submission, often used in affiliate marketing.
Cookies
Small data files used to track the referral source of a sale or lead, playing a key role in affiliate attribution.
Affiliate Link
A unique URL provided to affiliates, used to track the traffic sent to the merchant's website and attribute sales.
Earnings Per Click (EPC)
A metric that calculates the average earnings generated by an affiliate for every click to the merchant's site.
Cookie Duration
The time frame in which a cookie will track a user's actions and attribute sales to the affiliate, typically ranging from 24 hours to 90 days.
Two-tier Affiliate Marketing
A structure where affiliates earn commissions on their sales as well as sales generated by other affiliates they have recruited.
Landing Page
A standalone web page created specifically for marketing or advertising campaigns, where visitors 'land' after they click through from an affiliate link.
Return on Investment (ROI)
A measure of the profitability of an affiliate marketing campaign, calculated by dividing the net profit by the total cost of investment.
Pay Per Click (PPC)
An online advertising model in which advertisers pay a fee each time one of their ads is clicked, indirectly related to affiliate marketing.
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