When you first start your affiliate marketing journey, you’ll no doubt be faced with a bunch of different terms & there’s a high chance that you won’t know what they mean.
What’s more is that sometimes, it can feel embarrassing to ask.
So, to help you out in this situation, I’ve put together an affiliate marketing glossary with a list of all of the common terminology used, along with their meanings.
With the list below to hand, your confidence will be boosted & so will your success. 🚀
Let’s dive in and get to it.
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Affiliate Marketing Terms Explained
The terms listed below are listed in no particular order. If there’s anything else you’re unsure of, feel free to leave a comment below & we’ll add it to the list.
Affiliate Marketing
Affiliate marketing is the process of promoting products or services from third-party companies in return for commissions that are paid out on successful sales.
Essentially, it’s just like advertising, except instead of getting paid an upfront fee, you’re paid after you generate each sale.
All you need to do to earn with affiliate marketing is share a special link (known as an affiliate link) & if people make purchases after clicking via that link, those purchases are tracked back to you & you’re rewarded for generating the sales.
Affiliate Network
An affiliate network is a platform that houses many different companies that are looking for affiliates to promote their brands.
The affiliate network provides tracking capabilities along with reporting dashboards & it handles all of the payments from merchants to affiliates.
The benefit of an affiliate network is that with one single registration to the affiliate network, you can apply to hundreds (or potentially thousands) of different affiliate programs that are housed in their network.
FYI, we’ve listed the best affiliate networks here.
Affiliate Link
An affiliate link is a special link to a website that contains a unique tracking ID.
Often, they’ll look something like this: https://www.website.com/?aid=123
When somebody clicks via an affiliate link & makes a purchase, the company can detect which affiliate sent them there & reward them with a commission.
Affiliate Program
If a company provides the ability for you to generate an affiliate link & earn commissions by sharing it, then this is known as an affiliate program.
An affiliate program can refer to a standalone program (one not run through a network) but it can also refer to an individual program inside of an affiliate network.
Commission
This is the amount that you’re paid per sale as an affiliate. It could be a % value or it could be a fixed sum depending on the individual affiliate program you’re promoting.
Some companies use different terminology for this. For example, Amazon Associates refers to its commission rates as “Advertising Fees”.
Conversion Rate
This is the rate of people (measured as a percentage) that click your affiliate link & convert to a sale. For example, if you get 100 clicks & 10 sales, you would be said to have a 10% conversion rate.
Cost Per Action (CPA)
Some affiliate programs pay a fixed amount as a reward to the affiliate when they successfully get a visitor to complete a specific action. This is known as CPA marketing.
As an example, an affiliate program may offer a payment of $10 per registration. So, even if no purchase is made, the affiliate would earn $10 each time he/she was able to get a new person to complete a sign-up.
Cost Per Click (CPC)
CPC is an advertising term that refers to the amount of money it costs for you to generate each click on your advertisement. It’s calculated by dividing your total advertising spend by the number of clicks received.
As an example, if you spent £100 on advertising and received 50 clicks, your average CPC would be £2.
Cost Per Lead (CPL)
CPL is an advertising term that refers to the amount of money it costs for you to generate each lead from your advertisement.
A “lead” could simply be as little as a person’s email address, or it could be as much as their full name, email, birthdate & home address, etc.
CPL is calculated by dividing your total advertising spend by the number of leads generated.
As an example, if you spent £100 on advertising and received 20 leads, your average CPL would be £5.
Click-Through Rate (CTR)
CTR refers to the number of clicks your advertisements received compared to the number of times they were shown. It’s the rate at which people actually see them and decide to click through.
Cookie Duration
Most affiliate programs leverage something known as affiliate tracking cookies. These are small text files that get saved onto a device when a user clicks on an affiliate link.
The small text files that get saved contain the ID of the affiliate whose link was clicked so that if the person re-visits & makes a purchase at a later date, the affiliate will still be credited.
Cookie duration refers to the duration of time that these affiliate tracking cookies will remain active on the user’s device before being automatically deleted.
As an example, if an affiliate program offers a 30-day cookie duration then the affiliate could stand to earn a commission even if the user doesn’t make a purchase until 30 days after initially clicking the link (providing they make the purchase on the same device).
Earnings Per Click (EPC)
EPC refers to the average amount of money that you earn for every click on your affiliate links. It’s calculated by dividing total earnings by the number of clicks.
As an example, if your affiliate link received 100 clicks & generated $200 in commissions, it would have earned on average $2 per click, thus generating a $2 average EPC.
Landing Page
A landing page is a page where visitors arrive. For example, if you landed on this blog post from a search engine, then this blog post would be the landing page.
Often, people create landing pages that are specifically designed to get users to complete an action (such as entering an email) & these types of landing pages are known as squeeze pages.
Lead Generation
This refers to the act of obtaining contact details for retargeting. For example, running ads to a page where users are asked to input their email addresses would be deemed lead generation if you were storing the email addresses to promote to them.
Merchant
A merchant, also known as an advertiser, is a company or individual that sells products or services and establishes an affiliate program for publishers to promote those offerings.
Merchants provide affiliates with links, banners, and sometimes even content to help them promote the products. The relationship benefits the merchant through increased sales or leads, driven by the affiliates’ marketing efforts.
Niche Market
A niche market refers to a specific, focused segment of a broader market that businesses can serve to differentiate themselves from the competition.
For affiliates, choosing a niche market means targeting a distinct audience with particular interests, which can lead to more effective marketing and higher conversion rates due to the tailored approach.
Pay Per Sale (PPS)
PPS is an affiliate marketing commission model where the affiliate earns a commission only when their referral results in a sale.
The amount of the commission is usually a percentage of the sale price but can sometimes be a fixed amount. This model incentivizes affiliates to drive meaningful conversions, not just traffic.
Pay Per Click (PPC)
PPC is a digital advertising model in which advertisers pay a fee each time one of their ads is clicked. It’s a way of buying visits to your site, rather than attempting to “earn” those visits organically. Search engine advertising is one of the most popular forms of PPC.
Pay Per Lead (PPL)
In a PPL model, affiliates are paid for each lead they generate. A lead is defined as a potential customer who has shown interest in the product or service by completing some action, like signing up for a newsletter or filling out a contact form. This model is beneficial for businesses focused on building a database of potential customers.
Performance Marketing
Performance marketing is a comprehensive term that refers to online marketing and advertising programs in which advertisers pay marketing companies (affiliates or publishers) when a specific action is completed; such as a sale, lead, or click. It’s highly measurable and performance-based.
Publisher
A publisher, also known as an affiliate, is an individual or company that promotes a merchant’s products or services in exchange for earning a commission. Publishers use their various channels like blogs, social media, or websites to connect potential customers with the merchant’s offerings.
Referral
A referral in affiliate marketing is when someone clicks on an affiliate link and is directed to a merchant’s website. If this visit leads to a desired action (e.g., a sale or sign-up), it can result in a commission for the affiliate. Referrals are crucial for tracking the effectiveness of affiliate marketing efforts.
Search Engine Optimization (SEO)
SEO is the practice of increasing the quantity and quality of traffic to your website through organic search engine results. It involves optimizing your online content so that a search engine likes to show it as a top result for searches of a certain keyword.
Tracking Code
A tracking code is a snippet of code that is placed on your website to monitor the actions of visitors, such as form submissions, product purchases, or page views. It’s essential for affiliates to track the performance of their links and understand the behaviour of their audience.
Traffic Source
The origin through which people find your website is known as a traffic source. Common sources include search engines, social media networks, and email links. Understanding your main traffic sources is crucial for tailoring your marketing strategy.
Two-Tier Affiliate Program
This type of affiliate program allows affiliates to earn commissions on their conversions as well as conversions of others they refer to the affiliate program. It’s an effective way to increase earnings by not only generating sales but also by recruiting other affiliates.
Heads up, we’ve listed the best two-tier affiliate programs here.
Unique Visitor
A unique visitor is an individual user who has accessed your website or landing page. They are counted only once regardless of how many times they visit the page, providing insight into the reach of your content or ad campaign.
White Label
White label products or services are produced by one company, then rebranded and resold by another company under their own brand name. In affiliate marketing, white labelling allows affiliates to sell products as if they were their own, enhancing brand cohesion.
Banner Ad
A banner ad is a form of online advertising that embeds a graphic on a web page to attract traffic to a website by linking to the website of the advertiser. These are common tools for affiliates to generate interest in a merchant’s offerings.
Chargeback
A chargeback occurs when a customer disputes a charge from their bank or credit card company, leading to the reversal of the transaction. In affiliate marketing, this can affect commissions if a sale is later nullified.
Deep Linking
Deep linking allows affiliates to direct potential customers to a specific page on the merchant’s site, rather than the homepage. This can improve conversion rates by providing a more relevant and direct path to products or services.
Impression
An impression is counted each time an ad or sponsored link is displayed on a website, regardless of whether it is clicked. It measures how often your content is seen, helping gauge the visibility of online advertising.
Influencer Marketing
Influencer marketing involves partnering with social media influencers to promote your products or services. It leverages the influencer’s credibility and audience to increase brand awareness and drive sales.
If you’re an influencer, we’ve listed the best affiliate programs for influencers right here.
Keyword
Keywords are words or phrases that people use when searching for information online. Optimizing your content with the right keywords can improve its visibility and ranking on search engine results pages (SERPs).
Lifetime Value (LTV)
LTV represents the total amount of money a customer is expected to spend on your products or services during their lifetime. Understanding LTV helps affiliates and merchants forecast revenue and strategize marketing efforts.
Multi-Level Marketing (MLM)
MLM is a strategy some direct sales companies use to encourage existing distributors to recruit new distributors. In affiliate marketing, MLM schemes can be controversial and are distinct from standard affiliate practices.
Organic Traffic
Organic traffic is the number of visitors that land on your website as a result of unpaid search results. Higher organic traffic indicates effective SEO and content marketing strategies.
Paid Traffic
Paid traffic involves visitors coming to your website from paid advertising, such as PPC campaigns or sponsored social media posts. It’s a way to directly attract visitors, often used in conjunction with organic strategies.
Recurring Commission
A recurring commission is earned on subscription-based products where the affiliate continues to earn money for as long as their referred customer remains subscribed to the service.
Here are the best recurring commission affiliate programs we’ve found. ✅
Retargeting
Retargeting is a form of online advertising that targets users who have previously visited your website with banner ads across different websites. It aims to bring back interested users to complete a purchase or action.
Search Engine Marketing (SEM)
SEM is a digital marketing strategy used to increase the visibility of a website in search engine results pages. It combines SEO efforts with paid advertising, like PPC.
Split Testing (A/B Testing)
Split testing, or A/B testing, involves comparing two versions of a webpage or ad to see which one performs better. It’s a method to optimize webpages for conversion rates or other desired outcomes.
Super Affiliate
A super affiliate is an affiliate that generates a significant portion of an affiliate program’s activity or revenue. These affiliates are highly skilled in driving traffic, conversions, and sales.
The good news is that we’ve put together a guide explaining how you can become a super affiliate. 🚀
Third-Party Monitoring
Third-party monitoring involves using external services to track and verify affiliate marketing activities, ensuring accuracy in reporting and commission payments.
Tracking Pixel
A tracking pixel is a tiny, transparent image embedded in emails and web pages to monitor user behaviour and track actions such as views or conversions. It provides valuable data on the effectiveness of online marketing campaigns and user engagement.
Upsell
Upselling is a sales technique where a seller induces the customer to purchase more expensive items, upgrades, or other add-ons in an attempt to make a more profitable sale. Within affiliate marketing, upselling can increase the average order value, directly impacting commissions.
Vertical Market
A vertical market focuses on a specific industry, demographic, or niche. Companies, products, and marketing strategies in a vertical market are tailored to meet the specific needs of that market segment.
Affiliates focusing on vertical markets often have in-depth knowledge or a particular interest in their chosen niche.
Webinar
A webinar is an online seminar or workshop where content is presented to an audience through the internet. Webinars are used in affiliate marketing for educational purposes, product demonstrations, or to engage with potential customers in a live or pre-recorded format.
Affiliate Disclosure
An affiliate disclosure is a statement that reveals the financial relationship between an affiliate and the merchant of the products or services they promote.
Disclosures are necessary for transparency and are required by law in many jurisdictions to inform consumers that the affiliate may earn a commission from their recommendations.
Affiliate Manager
An affiliate marketing manager is a person or team responsible for running an affiliate program for a merchant. They recruit affiliates, provide them with marketing materials, manage the relationship, track the performance of the affiliate program, and ensure timely commission payments.
Affiliate managers are pivotal in maximizing the effectiveness and profitability of an affiliate program.
The Bottom Line
At first glance, it can seem like there are a lot of terms you need to familiarise yourself with & that might feel a little bit daunting.
However, there’s no need to let it put you off.
First of all, you don’t technically need to know & understand all of those terms to succeed. Many affiliate marketers don’t even discover some of them until years into their journey.
Heck; I’d been doing affiliate marketing for years before I learned about “tracking pixels”.
And secondly, with the help of our free step-by-step training, you can follow a proven process to reach success through simple daily tasks.
So if you want to smash it as an affiliate marketer & haven’t already signed up for our course, be sure to sign up for our free training before you leave.
But overall, I hope this affiliate marketing glossary proved to be useful for you & as mentioned earlier, if there are any additional terms that you’d like to know about, feel free to leave them in a comment below.
