Affiliate Marketing Glossary Now Available

Are you just learning the ropes of the affiliate marketing space? Access more than 70 affiliate marketing terms from ERA’s online Knowledge Center.


1.     Advertiser: The Merchant who sells products, goods or services through Affiliate Marketing is also called the Advertiser.


2.    Affiliate: An Affiliate (also known as a Publisher) drives traffic to a Merchant for a Commission that is based on an action, such as an acquisition or sale.  The Affiliate can be either a company or individual person.


3.     Affiliate Fraud: Bad Affiliates will use fraudulent methods to generate and steal Commissions. The most common method is to create fake sales using stolen credit card data. The Advertiser believes the sales are legitimate and the Affiliate is then paid Commissions accordingly.


4.    Affiliate Link: Unique linking code that enables the Merchant and/or Affiliate Network to accurately track and credit sales being generated by Affiliates.


5.    Affiliate Management Agency: A 3rd party that is paid to recruit, manage and optimize an Affiliate driven campaigns. Agency may also design the Creatives.  Affiliate management agencies typically charge a nominal retain or earn a small percentage Commission based off sales generated by the Affiliates the manage.


6.     Affiliate Manager: Typically the individual responsible for managing and administering an Affiliate Program for the Merchant’s Offer. Duties include maintaining regular contact with affiliates, program marketing, and responding to queries about the program.


7.    Affiliate Marketing: A marketing method involving Affiliates who are contracted and paid Commission to drive traffic and generate sales on a Merchant’s website.


8.    Affiliate Network: A 3rd party that brokers traffic between Affiliate’s and Merchant’s offers.  Affiliate Networks typically provide tracking tools, reporting and occasionally provide payment processing services as well.


9.     Affiliate Program: Any structured program where a Merchant agrees to pay a commission to an Affiliate for driving traffic to the Merchant’s Offer and generating specific actions.  The actions could result in Clicks, Impressions, Leads, or Sales. Synonyms are revenue sharing, referral or partnership programs.


10.  Affiliate Reporting: Every Affiliate Program requires detailed tracking to verify which Affiliate generated the specific Clicks, Leads or Sales and the corresponding Commission’s generated.  Most Affiliates and Affiliate Network’s rely on 3rd party vendors to provide the Affiliate Reporting tools.


11.   Affiliate Software: Merchant’s may opt to utilize 3rd party software to operate and manage their internal Affiliate Programs.


12.   Affiliate Tracking: Reporting tools designed to track Affiliate Clicks, Impressions, Leads and Sales. The most common tool is Pixel Tracking.


13.   Banner Ad: Use of a graphic or image on a website placed by an Affiliate to advertise a Merchant’s offer.


14.   Click-­‐Through: The act of clicking on a Banner, Link or email and arriving at a Merchant’s website destination.


15.   Commission: The amount of revenue pre­‐negotiated and paid to the Affiliate for each Impression, Click, Lead or Sale generated to the benefit of the Merchant.


16.   Conversion: When a website visitor completes and action and is becomes either a Lead or Sale.


17.   Cost-­Per-­Acquisition (CPA): The Commission paid to an Affiliate for each generated Sale.


18.   Cost­‐Per­‐Action (CPA): The Commission paid to an Affiliate for every specific, require action.  The action may be a sign up for a mailing list, software or app download, lead form filled, etc.


19.  Cost­‐Per­‐Click (CPC): Commission paid to the Affiliate whenever a visitor clicks through to a Merchant’s website.  Unlike CPA models, there is no requirement for either an acquisition or action. See Pay­‐Per­‐Click (PPC).


20.  Creative: The promotional materials Affiliates use to drive traffic to the merchant website. Examples are Banners Ads, Text Links, emails, pop­‐ups, etc.


21.   Dynamic Content: Web content can include audio, video or animations.


22.   Email Affiliates: Certain Affiliates specialize in marketing offers to consumers via email.  The Email Affiliate must have documented proof that their email list utilizes double opt in permission and is CANSPAM compliant.


23.   Email Marketing: Marketing offers to consumers via email.


24.  Exclusivity: Affiliates, Publishers and Networks routinely require “Exclusivity” to market an Advertiser’s specific offer. Under this context, the Marketer agrees to solely and exclusively obtain traffic from the single source of traffic i.e. the Affiliate. In exchange for Exclusivity, the Marketer may get lower CPA rates or a larger Affiliates which may bid up PPC buys for certain Key Words.


25.  Impression: Every time a consumer views an advertisement, it is counted as an Impression. Dividing Conversions by Impressions calculates the Conversion rate.


26.  Incentivized Affiliates: Affiliates may utilize incentives to help web traffic convert in exchange for earning Commissions.  The Incentivize can be discounts, a free subscription or a potential prize.


27.  Keyword: Any combination of words used to query a search engine is called a Keyword. Keywords are utilized to optimize websites for search engines or for Affiliates looking to purchase PPC advertising traffic to drive sales on a Merchant’s specific offer.


28.  Lifetime Value (LTV): The average revenues generated by each consumer’s lifetime. Typically applies to continuity subscription models. For example, if a consumer remains on a $50 continuity subscription for 3.2 months, the LTV = $50 X 3.2 = $160.


29.  Mailer: A marketing email usually containing graphics and text directed at potential consumers.


30.  Manual Approval: Individual Affiliates typically apply to drive traffic to larger Affiliates, Publishers and Networks because larger operators can acquirer larger clients with deeper pockets.  Some Affiliates, Publishers and Networks take the time to give Manual Approval, meaning the applicant has been thoroughly screen and verified prior to being authorized to drive traffic to Advertiser’s offers. Traffic sources that utilize an Auto Approval for their applicants will have considerably higher rates of Affiliate Fraud.


31.  Media Buy: Buying advertising space on websites to generate traffic for Advertiser’s offers.  Advertisements are typically banner or text ads.


32.  Merchant: See Advertiser


33.  Mobile Affiliates: Affiliates that specialize in traffic originating from mobile and tablet devices.


34.  Network: The pool of Affiliates and Advertisers typically managed by the Affiliate Network. Merchant benefit from having multiple affiliates available to drive traffic on their Niche campaign.  The Affiliates benefit from having multiple Advertiser offers to choose from. The alternative would be for each Affiliate and Advertiser to seek out and find each other which is very inefficient.


35.  Niche Marketing: Advertising or marketing to a narrowly focused consumer segment. For example, skin cream for millennial males.


36.  Paid Search: All Affiliate traffic originates with Paid Search. Affiliates typically do Media Buys or websites or purchase Keywords from PPC sources such as search engines.


37.  Pay‐Per­‐Click (PPC): (1) An advertising payment model whereby the advertiser pays only when the advertisement is actually clicked. (2) An affiliate program where an affiliate receives a commission for each click (visitor) they refer to a merchant’s website.


38.  Pixel: An abbreviation of ‘picture element,’ a pixel is a single point in a graphic image. The basic unit of the composition of an image on a television screen, computer monitor, or similar display. Commonly in retail affiliate marketing, merchants use pixel tracking to record all transactions or leads generated. In this context, a pixel is an invisible image that is normally fired on the final page of the shopping cart.


39.  PPC Affiliates: Pay Per Click (PPC) affiliates send traffic through to a merchant’s site using PPC engines such as Google Adwords and Yahoo/overture and Miva. Affiliates purchase relevant keywords in search engines to lure traffic relevant sites that contain a merchant offer appropriate to the keyword used.


40.  Publisher: Some affiliate networks use the term ‘publisher’ as an alternative to ‘affiliate .’


41.  Referring URL: The URL a user came from to reach your site.


42.  Return on Investment (ROI): This is the amount derived by subtracting your net revenues from your total costs. This calculation is often used to calculate profitability and/or feasibility of PPC campaigns .


43.  Revenue: The total amount of your sales, before expenses are subtracted.


44.  Search Engine Optimization (SEO): The process of choosing keywords and keyword phrases relevant to your site or page on your site, and placing those keywords in the content of web pages. This is done in an effort to rank high in search engines, to attract a high volume of visitors to a website.


45.  SEO affiliates: Search Engine Optimization (SEO) used to optimize a website’s code to improve search engine ranking for specific Keywords. Having the top position for the Advertiser’s offer in search engines results in the highest Conversion rates possible. Consequently, Affiliates that specialize in SEO are highly compensated.


46.  Social Networking Affiliates: Affiliates that specialize in social media traffic optimization. They typically utilized Incentivized traffic by offering discounts, coupons and prizes to get traffic to convert capabilities, they are deemed “Super Affiliates”.


48.  Targeted Marketing: Selectively marketing specific goods, products or services to the consumers that have the highest Conversion rates. For example, marketing children’s books to mothers as they are the most likely consumer to purchase from the advertisements.


49.  Text Link: A hyperlinked text that Affiliates use to drive traffic into an Advertiser’s offer.


50.  Tracking Method: There are a variety of technical solutions that can be implemented to track Affiliate Clicks, Impressions, Leads and Sales.


51.  Two­‐tier: An Affiliate compensation program that involves two compensation rates. For example, an Affiliate may be compensated $35 to generate an initial sale plus an additional $3 per successful continuity rebill.


52.  Unique User: A unique visitor to your website. In terms of affiliate marketing and tracking, it’s someone who has been identified and tagged.


53.  Viral Marketing: A marketing technique that induces Converted consumers to share, like, post, email or Tweet the Advertiser’s offer to generate subsequent sales.


54.  URL Parameters: The campaign tracking variables or attributes that are passed within the advertiser’s click URL (or pixel) and utilized to track which media source, channel, campaign, and/or affiliate network generated an order.

55.  Tags: See ‘pixels’


56.  Offer: The “offer” is the combination of the advertiser’s product, its price, any extended discount/incentive, and price model (for example: continuity program, buy one get one, free trial, negative option, etc.) they are making available for the affiliate networks & publishers to promote.


57.  Host­‐and­‐post: A type of affiliate model in which the publisher hosts the advertiser’s conversion funnel on the publisher’s own site then transfers the transaction details to the advertisers database.


58.  CPA Network: A type of ad network that charges advertisers a bounty or commission for every converted action (for example: a sale, a lead).


59.  Sub-­affiliate: A publisher that does not have a direct relationship with the advertiser or affiliate network and instead works “under” another publisher or CPA network who does work directly with the advertiser or affiliate network.


60.  Compliance policy: An advertiser’s set of rules of that dictate the allowable practices and procedures a publisher can utilize to promote the advertiser’s product and also defines which practices are in not allowed and in violation.


61.  Referral period (aka cookie duration): The period of time dictated by the advertiser in which the publisher.


62.  Non­‐incent: A publisher promotional model in which special incentives or enticers are not used for the sake of inflating conversions rates.


63.  Payout: see ‘commission’


64.  Reconciliation: The process of quantifying the amount of valid orders the advertiser recognizes against how many orders affiliates were originally commissioned on by scrubbing out the invalid orders due to bad or fraudulent credit cards, product returns, invalid billing information, etc.


65.  Fraud Monitoring: The advertiser practice of monitoring and enforcing its compliance policies by employing a variety of processes and tools that track affiliate behavior.


66.  Program Terms: The offer details, commission/payout  structure, and compliance policies that the advertiser makes available to affiliate publishers for promotion.


67.  Charge-­back: An invalid sale that results in the affiliate’s commission being forfeited.


68.  ROAS: stands for ‘Return on Advertising Spending’. This is the amount of revenue generated for every dollar spent on advertising. For instance, a ROAS of $1 means you’re generating $1 in sales for every $1 in advertising spend, and a ROAS of $5 means you generate $5 in sales for every $1 in spending.


69.  Pay­‐Per­‐Sale: An affiliate marketing program that rewards affiliates based on each conversion to a sale such as when purchasing a product or service from the merchant’s web site.  Pay­‐per­‐sale programs usually offer the highest commissions but tend to have the lowest conversion rates.


70.  Pay­‐Per­‐Lead: Affiliate program that rewards affiliates for conversions to leads.  A lead might include a signup form, software download, survey, contest or sweepstakes entry, signup for a trial, etc. Pay­‐per­‐lead generally offers midrange commissions and midrange to high conversion ratios.


71.  Cookies:  small text files sotred on the visitor’s computer, which record information that is of interest to the merchant site. In affiliate software cookies are utilized to track, which affiliate the web visitor came from and which banner or link they clicked.  They can also store the date/time of the click for purposes of tracking the time elapsed between a click and a conversion to a sale or lead.