Affiliate Marketing - enhancement of Return on Investment (ROI)

 Affiliate Marketing - enhancement of Return on Investment (ROI)




Cost Per Action (CPA) is an Internet-based advertising pricing model, where affiliate marketer for a company agrees to promote company's product for a fixed commission at specific action. The action could be as simple as the prospect entering his/her email address, or as complex as a purchase of the product.

Payment calculations in CPA method depend on the action, and the number of potential customers. For example, cost per action with a simple example, for every new member registration, the advertiser decides a certain amount of fixed money for promotion. Depending on the action, the advertisers offer different payment options. This action can either be a payment per each registration (CPA), or a payment per click (CPC).

Cost Per Action (CPA) is used among affiliates in promoting products, as a pay-for-performance model, which is a profit-sharing dispute between an advertiser and an affiliate over the revenue to be shared.

Cost Per Action - How to Avoid Failure

Even though this marketing model is very effective, there are a few accessories out there that can help you become a success in this form of marketing. Here are a few ideas to help you get up to speed.

The Advertiser

When you are choosing an affiliate network, you should have a clear idea of the advertising costs to be incurred by the affiliate. It is essential to analyze these carefully, as they can play a huge role in your success (or failure) with the network.

Earnings

You are going to be earning between 15 and 45% commissions when you partner with a good network. Your earnings will directly reflect how much you are able to pay to the affiliate, as the cpa network gets the larger portion of the total earnings. Therefore, pay close attention to the payout amount. It should be lower than what you can get as a commission-based partner. Also, make sure that the earnings per action are much higher than other offers. A 1% commission for each registration is not very much, but if the same commission is paid for each new member addition, the total earnings can be much higher.

The offers

Offers are the vital area that will make or break your success with Cost-per-Action networks. In most cases, you are only allowed to send traffic to the merchants' websites, and then only if they perform a certain action. In CPC networks, you must send the traffic to a landing page, and then perform a task (which can often be as simple as submit an e-mail, or download a file). When the customer completes the action, you get paid. So, you must make sure that the offers you send to the potential customers will be what they want. The advertising cost can be based on any action the customer takes. It can also be a fixed cost per head or body.

The Cost-per-Action Marketing Method

Sometimes, you can combine CPA methods with CPC methods, to form a customized advertising package. This is where you target the best keywords for the offer that the prospect will naturally be using. When they click on the offer link, you will be paid, but it is usually much lower than what you would receive as a commission-based partner. The drawback is that this is what the visitor would naturally do.

In conclusion, there are many ways to excel at cost-per-action marketing. If you want to experiment, you can use all the different types of cost-per-action methods, and find which ones work best for you and your type of business.

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