Affiliate Marketing Glossary

Affiliate– A person or a website owner that is paid a commission as a result of referring clicks, leads, or sales to a vendors website and or product.

Affiliate Agreement– A contract between a merchant and an affiliate governing a relationship.

Affiliate Information Page– A page (or pages) on your website that clearly explains what your affiliate program is about.

Affiliate Link– A piece of code that is attached to an image or a piece of text that is placed on an affiliate’s web page. It is for the purpose of notifying the merchant that an affiliate’s account should be credited if a sale is produced.

Affiliate Manager– The manager of an Affiliate Program who is responsible for the creation of newsletters, the establishment of incentive programs, forecasting, budgeting, overseeing front-end marketing of the program, and the monitoring of industry news and trends.

Affiliate Program– A place where merchants may list the products and services they wish to sell. An affiliate needs to create an account at the said program before they can attain access to the listed products. Once an affiliate joins an affiliate program, they are able to promote products and earn money.

Affiliate Program Directory– A list of affiliate programs, featuring information such as the commission rate, number of affiliates, and affiliate solution provider. Associate-It, AssociatePrograms.com and Refer-it are among the largest Affiliate Program Directories.

Affiliate Solution Provider– A company that provides the network, software, and services needed to create and track an affiliate program. Wealthy Affiliate University is one such affiliate solution provider.

Associate– Another word for referring to an “affiliate.”

Auto-Approve– An affiliate application approval process where all applicants are automatically approved for an affiliate program. Clickbank is typically an auto-approve program.

Auto-Responder– A software system that automatically sends an email message to anyone who sends it a message.

Banner Ad– An electronic billboard or ad in the form of a graphic image that comes in many sizes and resides on a website’s web page. Banner ad space is sold to advertisers to earn revenue for the website.

Browser– A program (software), such as Internet Explorer, Firefox, Chrome, or Opera, that is used to look at various kinds of Internet resources.

Charge Back– An incomplete sales transaction (i.e., merchandise is purchased and then returned) that results in an affiliate commission deduction. Also known as a refund.

Click Through– A result of a visitor clicking on an advertisement or text links on your website or blog.

Client– A software program that is used to contact and obtain data from a server software program on another computer, often across a great distance. Each client program is designed to work with one or more specific kinds of server programs, and each server requires a specific kind of client. A Web browser is a specific kind of client.

Co-branding– A situation in which affiliates include their own logo and branding on the pages to which they send visitors through their affiliate links.

Collaborative Commerce Networks– An organization of merchants and websites that work together as true business partners. Merchants give their affiliates the same support that manufacturers would give to the resellers of their products and services.

Commission– The income an affiliate receives for generating a sale, lead or click-through to a merchant’s website. It is sometimes called a “referral fee,” a “finder’s fee” or a “bounty.” Commissions are usually a percentage of the total proceeds of a particular sale and can be anywhere between 5 – 75%.

Context-centric– The process of matching your product or service offer closely to the visitors of an affiliate’s site. By placing the product or service in-context (closely related to the content it’s next to), more people will buy.

Contextual Link– The integration of affiliate links within your articles. They are usually closely related to the topic of your article and link to an affiliated product or service.

example: Anyone wishing to sign up at clickbank can do so by clicking here.

Contextual Merchandising– The act of placing targeted products near relevant content.

Conversion Rate– The percentage of clicks that result in a commission (ie: sale or lead).

Cookies– The small files stored on the visitor’s computer, which record information that is of interest to the merchant site. With affiliate programs, cookies have two primary functions: to keep track of what a customer purchases, and to track which affiliate was responsible for generating the sale (and is due a commission).

CPA (Cost Per Action)– The cost for each time an action is performed.

CPC (Cost Per Click) – The cost of each click to an advertising link.

CPM (Cost Per Thousand) – The cost an advertiser is willing to pay per one thousand impressions.

CPO (Cost Per Order) – The cost paid for each time an order is placed.

Customer Bounty – The amount a merchant is willing to pay an affiliate partner for every new customer that they direct to the merchants site.

E-mail Link – An affiliate link in an email. Usually a hyperlink.

E-mail Signature (Sig File) – The signature option allows for a brief message to be embedded at the end of every email that a person sends and can be fully customized by the user.

eZine – A term for an electronic magazine. Some eZines are simply electronic versions of in print magazines, whereas others exist only in digital format.

eZine articles– An article directory for publishers of all walks of life. It is free to sign up.

FAQ (Frequently Asked Questions) – Self explanatory.

HTML code – The code used to build web pages. Affiliates use HTML code to put links on their websites. Affiliate solution providers often provide a tool where affiliates can simply copy the code for an affiliate link and paste it into their own HTML pages.

Hybrid Model – An Affiliate commission model that combines payment options (i.e., CPC, CPA).

Impression – An indicator used for the purpose of telling a website owner how many times an advertising link is displayed.

Lifetime Value of a Customer – The amount of sales in dollars that a customer will spend with a particular company over their lifetime. Relevant to certain products that pay recurring commissions.

Manual Approval – An Affiliate application approval process where all applicants are manually approved for an affiliate program. Commission Junction gives the merchant the option of manually approving applicants.

Merchant – An online business that markets and sells goods or services. Merchants establish affiliate programs as a cost-effective method to get consumers to purchase a product, register for a service, fill out a form, or visit a Website.

Mini-site – A prefabricated HTML page for affiliates that displays new or specialized products with integrated affiliate links.

Pay-Per-Click – A program where an affiliate receives a commission for each click (visitor) they refer to a merchant’s website. Pay-per-click programs generally offer some of the lowest commissions (from $0.10 to $0.25 per click), and a very high conversion ratio since visitors need only click on a link to earn the affiliate a commission. Google adsense is the most widely known PPC program.

Pay-Per-Lead – A program where an affiliate receives a commission for each sales lead that they generate for a merchant website. Examples would include completed surveys,memberships, contest or sweepstakes entries, downloaded software demos, or free trials. Pay-per-lead generally offers midrange commissions and midrange to high conversion ratios.

Pay-Per-Sale – A program where an affiliate receives a commission for each sale of a product or service by a visitor that they have referred to a merchant’s website. Pay-per-sale programs usually offer the highest commissions and the lowest conversion ratio.

Residual Earnings – The programs that pay affiliates not just for the first sale a visitor from their sites makes, but all additional sales and / or upgrades made at the merchant’s site over the life of the customer.

ROAS (Return on Advertising Spending) – 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.

ROI (Return on Investment) – The amount of money that an investment makes.

Server – A computer, or a software package, that provides a specific kind of service to client software running on other computers. The term can refer to a particular piece of software, such as a WWW server, or to the machine on which the software is running. For example, “Our mail server is down today, that’s why email isn’t getting out.” A single server machine could have several different server software packages running on it, thus providing many different servers to clients within a network.

Spam – The electronic junk mail or junk newsgroup postings, generally email advertising for some product sent to a mailing list or newsgroup.

Storefront – A prefabricated HTML page for affiliates that displays new or specialized products with integrated affiliate links.

Super Affiliates – The top 1% of affiliates, based on performance and earnings, that generate the lion’s share of the revenue for any particular program.

Targeted Marketing – The act of offering the right offer to the right customer at the right time.

Text Link – A text based link that connects a visitor to another website and / or affiliate product. Also referred to as a hyper text link.

Tracking Method – The way that a program tracks referred sales, leads or clicks. The most common are by using a unique web address (URL) for each affiliate, or by embedding an affiliate ID number into the link that is processed by the merchant’s software. Some programs also use cookies for tracking.

Two-tier – Any internet marketing program that allows affiliates to sign up additional affiliates below themselves, so that when the second tier affiliates earn a commission, the affiliate above them also receives a commission. Two-tier affiliate marketing is also known as MLM (Multilevel Marketing).

Viral Marketing – The rapid adoption of a product or passing on of an offer to friends and family through word-of-mouth (or word-of-email) networks. Any advertising that propagates itself the way viruses do.