For those who are just starting, affiliate marketing tends to feel extremely complicated. At first, it seems like an impossible task but once you invest some actual time in learning how the wheel keeps spinning; you’ll quickly see that it’s not brain surgery or rocket science.
Affiliate marketing is a quite simple game.
In its essence, it’s a pretty straightforward deal.
And in addition to that, there are loads of credible affiliate programs across different markets that make it possible for everyone with a steady Internet connection to explore the possibility of generating significant revenue with a minimum starting investment.
According to our own survey, the most difficult part of jumping into affiliate marketing is the lingo.
If you don’t really have a decent background in digital marketing and online publishing, some of the terms used in this industry will probably confuse you.
P3P, action referral period, ad stream, affiliate network: To a newb, these phrases will only fuel the nightmare. It might seem like the affiliates have invented a special language that’s half Dothraki; half Klingon.
In order to help everyone who’s planning on joining the affiliate game easily overcome this barrier, Traffic Mansion has decided to produce a list of the most important and most commonly used industry terms and phrases.
Of course, this is only a start. We will continue to update this list as time goes by. For now, it’s best to have all the fundamentals in a single place:
THE BARE ESSENTIALS: Key Terms and Definitions
Advertiser – Advertisers or merchants is the term used to describe people who partner with affiliates in order to help them promote their products and services. The advertiser, a.k.a. merchant, rewards the affiliate with an agreed amount of money for sending traffic to his or her domain. He/she demands a certain service and affiliates deliver.
Affiliate – The key player in this game. Affiliates are people who earn commissions for referring clicks and leads to an advertisers website. They usually come in forms of webmasters and web administrators (admins).
Associate – Synonym for affiliate.
Affiliate marketing – The term affiliate marketing stands for any form of revenue-sharing program, deal, or agreement in which a particular website owner or web admin receives a commission for generating online clicks, leads, or sales for a particular advertiser.
Affiliate program – A specific type of deal/system that a particular advertiser offers to affiliates. What particular referrals does he/she need, how much money is he/she willing to pay for a specific lead or traffic; basically anything that will shine a light on what the goal is and what type of commissions affiliates will earn for their efforts.
Affiliate software – A specific type of program that publishers can use to run their own affiliate program within their company walls, opposed to using one of the credible affiliate networks.
Affiliate manager – An Individual who manages an affiliate program for a particular advertiser or list of advertisers. Affiliate managers handle recruitment of new affiliates, monitor efficiency and ensure that all the KPIs are being met in timely fashion. They also act as a bridge between the affiliates and advertisers, making sure that all involved parties are kept in the loop and up-to-date with everything concerning their collaboration.
Affiliate agreement – A specific document that outlines the rules, expectations, responsibilities and other legalities on both sides of the relationship between the merchant and the affiliate.
Affiliate link – A URL provided to an affiliate by the advertiser that includes a unique tracking code, specifically assigned from later to the former in order to monitor the efficiency of the affiliate’s activities. Every time someone you brought to the publisher’s sites conducts one of the desired actions, the link will record it and you’ll receive a fair commission for helping with the creation of a conversion.
Affiliate network – Big, medium, or small groups of third-party networks, assembled together with a goal of helping publishers manage their affiliate programs on their behalf. Affiliate network managers recruit new affiliates and provide the necessary organizational and technological assistance for tracking KPI and reporting. They also handle commissions and ensure that the affiliates are accordingly paid by the publishers.
Action ID – A specific number that identifies a particular action and commission that comes with it. These actions usually come in forms of leads and sales.
Action referral period – A specific period during which advertisers allow their cookies to stay active to register publisher’s referrals.
Ad stream – A series of ads displayed to the user once he or she lands on the site.
Website-Related Terms and Phrases
Above the fold – A section of a website your users see when they land on your page before scrolling down. It’s the first segment that catches the eye, so a lot of online professionals feel that this section of your site needs to be as good and exciting as possible. You never get a second chance to make a first impression, so you better make it count.
Cookies – In affiliate marketing, cookies are used as a tool for assigning IDs to users, so publishers could easily track the traffic or incoming leads from particular affiliates. Standard cookies last from 30 to 90 days, so if the user conducts a desired action in a time period before the cookie expires; the conversion will be awarded to an affiliate. It doesn’t really matter if we’re talking about the first or fifteenth visit; it will still count.
Direct Linking – Also known as deep linking, direct linking refers to an arrangement where a particular publisher is allowed to hyperlink directly to a requested product or service page on the advertiser’s site. This is basically a link building practice, done with a purpose of increasing a single page’s organic position in search for desired keywords and phrases.
Dynamic link – A specific link that carries various elements and allows advertisers to change its content in real time.
Homepage – The first and main page of a website. It’s like the facade of your digital business place. This is the first thing users see when they type in the domain name in search and land on your digital address. If your new visitors don’t like your “store front,” chances are they won’t come in and browse around.
Landing page – A custom web page designed to attract a specific group of Internet users. In the affiliate marketing world, landing pages are created with a goal of provoking one or more specific actions from the targeted group of users. They are often filled with CTAs and enriched with a powerful copy that speak volumes to the group’s interests.
Platform for Privacy Preferences (P3P) Policy – A special protocol that makes it possible for webmasters to disclose and elaborate the intent behind the use of data they collect about the users who visit their domain and pages.
The main purpose of this policy is to provide users with a better control and understanding on how their personal information is being processed while they browse the Web.
P3P is also quite valuable from an online sales perspective, because it informs users what specific data (shipping address, credit card number, etc.) they’re willing to disclose to the site on which they shop. If a particular site on which users make a purchase demands more data, the browser will alert of the situation. It is the users’ call whether or not they want to share additional data.
Tracking code – HTML code, used as a unique identifier, that helps the publisher understand from which affiliate is specific traffic coming.
Ad-blocker – A piece of software people install in browsers to prevent ads from appearing on their screen. Ad-blockers are becoming more and more popular every single day. Studies have shown that today, more than 200 million Internet users use variations of this particular piece of software.
As the WSJ claims, ad-blockers have cost publishers more than $21 billion in 2015 alone. And that’s just the tip of the iceberg. At this rate, Ovum predicts that around $35 billion will be lost in total ad revenue by 2020. That’s why affiliate marketing, and digital marketing in general, is no longer just a game. If you want to create a sweet revenue today, you need to get creative.
Advertiser ID – A unique identification number of an advertiser’s program.
Click – A type of voluntary action that comes from a click on the mouse or touchpad. It is one of the activities that publishers want from affiliates and their referrals. This is how affiliates usually generate revenue.
Click fraud – A scenario where someone uses a particular script or program to generate large numbers of clicks on a particular ad, without actually having any interest in the content of the target.
Click-through rate – A.k.a. CTR, is a popular metric that displays the ratio of how often your users have seen your ad and ended up clicking on it. The rate itself is calculated by dividing the number of impressions by the number of clicks. For example, a CTR score of 1 percent means that for every 100 impressions your ad has received, one person has clicked on it.
Conversion – A specific action (usually a signup or purchase), defined by the publisher as the action of value.
Conversion rate – A metric that measures how many people click on your ads and then become your customers. Number of conversions/total ad clicks. For example, if you had 5 conversions on 100 clicks, conversion rate would be 5 percent.
Cost per action – A.k.a. CPA, is a specific advertising model where a certain publisher is being informed how much a certain action is costing them to acquire. It is an agreed fee specified for each type of action. For leads, that can mean a specific amount, while for sales it usually comes in sets of percentages of the sale amount.
Cost per click – A.k.a. CPA, a common advertising model used for generating traffic, where an advertiser pays the publisher whenever someone clicks on the ad that’s placed on his or her site.
Cost per thousand – A.k.a. CPA, is an advertising model where a particle publisher pays a certain amount of money in exchange for 1,000 impressions on a desired website.
Cost per order – A.k.a. CPO, refers to the amount of money spent on advertising or marketing that created a particular sale.
Creative – A piece of promotional material used to stimulate users into conducting desired actions. Creatives come in different forms and sizes. Text, video, image, or a combination: A creative is basically any type of promotional material that is positioned in front of the user.
Geo-targeting – A marketing method of analyzing and understanding the location from where your audience is coming and delivering specifically crafted content to those visitors based on their geo position.
Payment threshold – A minimum amount of money affiliates need to make before they can request a payout from the publisher.
Residual earning – A specific type arrangement/program where the affiliate earns commission not just from the first sale he brought to the merchant, but for all the future sales on the merchant’s site that come from that particular customer.
ROI – A.k.a. Return-of-Investment, is a common marketing and advertising metric that compares in percentage the money you have earned/lost against the money you’ve invested.
ROAS – Short for Return On Advertising Spend, ROAS is a metric used to work out exactly how much revenue you have made per dollar spent on advertising.
White label – A particular deal where the publisher allows the affiliates to see his products and services under their own brand. The affiliate makes no mention of the merchant anywhere, making it seem like they are selling their own thing.
Over to You
Thank you for taking the time to read this glossary from the beginning to the end. We hope it helped you to better understand how affiliate marketers talk and what phrases and terms you need to insert in your vocabulary in order to play the game correctly.