As with any industry, there are a fair amount of jargon, special words and expressions that are used in the affiliate marketing industry. Here are some of the common ones that you'll read and hear about.
Affiliate marketing is essentially the online variation of a commission paid salesperson. Your job is to sell a company's services and products on the internet. The company will then pay you a commission based upon the total amount of the sale when somebody purchases that service or product from you..
Affiliate marketing programs can provide great income streams when you promote the right types of products and services to the right target audience. But, as with any business, there is a reasonable amount of jargon, lingo, words and phrases that are used in the affiliate marketing industry. Here are some basic explanations on some of the typical ones that you'll read and hear about.
Conversion Rate.
This is number of people that you direct to a website that actually become customers. Your rate of conversion is dependent on what you paid to send the traffic to the website and the commission you earn per sale. Clearly, the lowest possible conversion rate is your break even point, where the your advertising costs are exactly covered by your commission earnings.
Earnings Per Click (EPC).
The EPC is used to determine the average earnings generated as a result of 100 clicks on an affiliate marketing link or advertisement. You can use it to measure one affiliate program against another. If a program has a $10 EPC, that means that for every 100 people you sent to that product owner's website you should earn about $10 in commissions.
Upsell.
This is when the product owner presents follow-up products to your referral customer. When there are upsells, back-end products or one time offers, it usually means you can break even on your advertising and marketing costs for the initial offer, because you'll maximize your commissions on the other products. Just ensure that you will get a percentage commission on any upsells.
Refund Rate.
All good businesses have a refund policy and it's just the same for the affiliate marketing business model. A refund rate is generally worked out for every 100 people who purchase the product and then request a refund. Don't forget that if a product owner refunds a customer, you won't get paid any commission. So choose your products carefully. A good product should not have a refund rate of over 10%.
Setting up an affiliate marketing business is great way to start generating income via the internet. If you take steady action and watch market trends and demands, you can quickly enjoy the rewards.
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