Become an affiliate marketing professional by arming yourself with the definition and meaning of up to 100 affiliate marketing jargon, keywords, and key phrases.
Table of Contents
A person or company that uses trackable links to promote a brand’s products or services in exchange for compensation (e.g. percentage of a sale). Affiliates are the brand’s marketing partners.
They can be bloggers, active social media posters, niche content sites, personal website owners, product review websites, shopping sites, mobile apps, app-to-app marketing platforms, mass media sites, loyalty, coupon and reward websites, and even other brands.
Affiliates are compensated by a brand only after delivering on the desired action (e.g. sale, lead, new customer, etc.).
A type of affiliate technology provider. Affiliate networks create tracking links for affiliates to use in their marketing promotions, store creative such as images, and pay affiliates who’ve driven a conversion. To varying degrees, affiliate networks also run reports of the affiliates’ performance data.
In addition, affiliates are able to join brands’ affiliate programs through an affiliate network; some affiliates even work exclusively through the affiliate network.
In some cases, affiliate networks also provide program management services.
An affiliate prospect is a customer who has received a referral link that they can promote your program regardless of their interest.
Affiliate recruitment is a feature that allows you to provide referral links to your customers after a purchase has been completed.
Average Order Value (AOV)
The average dollar amount is spent each time a customer places an order. It’s calculated using the formula: Total revenue/number of orders.
An affiliate is a person, business, or company charged with the responsibility of promoting a third party’s product or services in exchange for a reward called commission.
Affiliate Marketing Program
Affiliate Software as a Service (SaaS) Platform
Similar to affiliate networks, an affiliate SaaS platform is a type of affiliate technology provider. SaaS affiliate technology creates tracking links, tracks affiliates’ performance, stores brand creative such as images, pays affiliates once they’ve driven a conversion, and runs detailed data reports of affiliate activity and performance.
Affiliates can also join brands’ affiliate programs through a SaaS platform. Metricks is one of these platforms.
A few key differences between most affiliate networks and SaaS solutions is that there are no exclusive affiliate partners to a SaaS platform and SaaS providers do not offer program management services. Their focus is only on performance marketing technology.
Affiliate Text link
Otherwise called an affiliate referral link is a clickable, trackable link that displays words (text) up to a specific character limit. When clicked on, the user is directed to a website. That action is tracked through the affiliate text link and the data is monitored by an affiliate network or affiliate SaaS platform.
The balance is the amount that an affiliate is due. An affiliate’s balance is calculated by deducting affiliates’ paid-out amounts from all approved commissions.
In a B2B business model, a business targets and sells its product or service to another business. Full form; Business to Business.
In a B2C business model, a business targets and sells its product or service to individuals. Full form; Business to Consumers.
Bonuses are extra rewards that can be automatically issued when an affiliate reaches a pre-set milestone.
Capped Amount or Rate
A capped amount or rate means that the rate or percentage of commission is allowed to fluctuate, but cannot surpass a stated commission cap.
C2B businesses allow individuals to sell goods and services to companies. In this eCommerce model, a site might allow customers to post the work they want to be completed and have businesses bid for the opportunity.
Affiliate marketing services would also be considered C2B. Fiverr is an innovator in this model by helping businesses hire freelancers.
The C2B eCommerce model’s competitive edge is in pricing for goods and services. This approach gives consumers the power to name their prices or have businesses directly compete to meet their needs.
Recent innovators have creatively used this model to connect companies to social media influencers to market their products.
A C2C business — also called an online marketplace — connects consumers to exchange goods and services and typically makes their money by charging transaction or listing fees. Online businesses like Craigslist and eBay pioneered this model in the early days of the internet.
C2C businesses benefit from self-propelled growth by motivated buyers and sellers, but face a key challenge in quality control and technology maintenance.
When a customer has items in their online shopping cart, is on the checkout page, and decides to exit the website without completing a purchase by making a payment.
This occurs when a customer arrives at your landing page through a click on a hypertext link or banner on a website, tablet, or mobile device. This link is usually an affiliate’s text link.
The number of affiliates that have at least one click during a given period. A click active percentage can be obtained using the formula: affiliates who have clicks divided by total affiliates.
The different clicks that a consumer makes before completing a purchase. This concept can be visualized with a straight line. The start of the line is the first click; the end of the line is the purchase.
The clickstream comprises the clicks between the first click and the purchase (including the first click). Each “click” refers to a consumer clicking on a marketing ad.
Click-Through Rate (CTR)
The percentage of people visiting a web page who click on an affiliate’s text link in a particular advertisement. To calculate the CTR, the following formulas are used:
For ads on a website: clicks divided by impressions
For emails: clicks divided by opened emails
The monetary reward is given to an affiliate for a customer completing an action (i.e. a sale or lead generated) through their link.
The percent of a sale an affiliate will receive a payout. For example, if your commission rate is 10% on a sale of $100, the commission rate would be $10. 100 x 0.10% =$10.
This is a feature that allows you to create additional commission types and rates – useful in the case that you’d like to issue different commissions per action or product/SKU.
An article that is editorial in nature. Could be a blog, product or service review, a video, a social media posting, an image or pictures, or other forms of information.
Affiliates whose main form of advertising a brand, product, or service is to create content (blog, review, social media post, editorial, etc.).
Conversion Rate (CR)
The average percent that a customer will convert on a sale, action, or lead. Conversions are divided by orders (leads).
Cookies are usually small text files, given ID tags that are stored on your computer’s browser directory or program data subfolders. Cookies are created to keep track of customers’ movements within your site.
A cookie contains attribution and program information, which can later be used to attribute a conversion to the affiliate that referred the user.
Cost Per Action (CPA)
The cost it takes to obtain an action or sale. Cost divided by actions (or sales).
Cost Per Click (CPC)
The average cost for a click. Costs divided by clicks.
Cost Per Thousand/Cost Per Mille (CPM)
Refers to cost per thousand impressions or email list size.
Also called promo or voucher codes, they are given to customers to submit at checkout, which can be used to track and attribute conversions to a specific affiliate. Set up of coupon tracking may require the help of a developer.
An affiliate partner whose main offering to customers is coupons and deals.
A person or brand that has purchased your product or signed up for your service.
An affiliate that promotes brands’ offers (e.g. discounts or other incentives) through images and descriptions. Deal affiliates are often considered a hybrid of a coupon affiliate and content affiliate.
The term electronic commerce (eCommerce) refers to a business model that allows companies and individuals to buy and sell goods and services over the Internet.
Unique identifier for a conversion. Should be a unique value that you can use to cross-reference Tapfiliate conversion data with your own transactional records.
The process of identifying a group of customers by their geographical area and advertising to those customers in that specific area.
An action or metric (like revenue) that would not have occurred without the action being taken. Incrementality is the ability to directly tie spending (or other efforts) to revenue produced (or any other KPI).
A person who has a dedicated following on social media or blog readership whose audience trusts their opinions and recommendations. Influencers are often compensated by brands on a flat-fee basis (or free product) at the outset of the partnership before results have been delivered.
Companies that can offer a breadth of resources, giving brands access to thousands of influencers within their network. Before being allowed to join, each influencer is thoroughly vetted by the influencer network.
Insertion Order (IO)
Insertion order is a contract between two parties. The insertion order is a binding contract detailing the payment details and terms and is usually signed by the affiliate partner and brand directly.
Insertion orders also are considered contracts in SaaS platforms with the designated commission rate, timeline, and program terms and conditions.
The procedures involved in installing Metricks on your website.
Words or phrases that people type into a search engine to obtain relevant results. In affiliate marketing, keywords can be used to search for a specific brand or category on affiliate sites.
Key Performance Indicators (KPIs)
A type of performance measurement that is used to evaluate progress toward a strategic objective or goal.
In affiliate programs, common KPIs are sales, orders, average order value, conversion rate, click-through rate, return on ad spend, return on investment, and incrementality.
In affiliate marketing, some companies use their affiliate program to drive high-value leads for their business (often B2B companies).
The objective is to reach an audience that’s interested in the company’s service by capturing their identifiable information. This identifiable information could be captured through an email sign-up, a form-fill, or other information submission form.
Commission structure whereby all conversions/purchases made by a referred customer will be attributed to the affiliate that initially referred them.
Loyalty affiliates are affiliates that offer a reward to consumers for purchasing through them. This reward could be cashback, redeemable points, airline miles, college fund accounts, offers to apply rewards toward charitable organizations, etc.
Loyalty partners come in many forms but are mostly apps, or companies that incentivize potential consumers with a reward in anticipation of the desired action, typically a sale, free trial offers, signing up for a service, form-fills, etc.
Master Service Agreement (MSA)
A master service agreement is a contract that governs the work between two parties. In affiliate marketing, MSAs are used as the binding agreement before an insertion order.
The MSA includes the expectations for how the affiliate partner will promote the brand. If the expectation is not met and/or an affiliate partner violates the MSA, the affiliate partner can therefore be terminated from the brand’s affiliate program for non-compliance.
Additional information can be retrieved with a conversion.
Multi-Level Marketing (MLM)
A marketing strategy whereby affiliates are able to recruit other affiliates (sub-affiliates) and earn commissions from conversions driven by recruited sub-affiliates.
An offer is a promotion that a brand shares with its affiliates to promote. For example, “iPhones are $40 off today through Friday!”
Commission structure whereby the cookie placed in a user’s browser determines attribution.
Ads that appear on an affiliate’s website or influencer’s posts are negotiated at a set price between the brand and the affiliate/influencer or between an affiliate marketing agency and the affiliate on behalf of the brand.
Short form for “Affiliate marketing program”. A program is a context or environment in which your affiliates get referral links that they can use to drive conversions and earn commissions on said conversions. An Advertiser sets the program’s commission structure on the commission structure settings page of the program.
A marketing strategy that uses an automated, real-time bidding process to purchase ad inventory; can help brands advertise to specific users in specific contexts.
An estimate of results for an outcome of a specific event or program. For example, if a brand is planning to spend $10,000 for a homepage placement for a week with an affiliate partner, the brand will typically require a projection to tie back to their specific return on ad spend goal.
If the brand must meet a $10.00 ROAS, the partner would need to drive $100,000 in revenue for the placement to be successful.
Another term for an affiliate.
Clickable pop-up messages that appear on users’ browsers via a phone app, desktop, or tablet. Many affiliate partners especially loyalty partners have their own APPS.
They can market their push notification packages to engage with their app users and drive incremental traffic and revenue.
Quarterly Business Review (QBR)
A quarterly report and analysis of an affiliate program; includes recommendations/strategies for the future.
Commission structure whereby all payments generate a conversion for the affiliate that referred a subscriber to a service. Mostly used by SaaS.
Return on Ad Spend (ROAS)
Critical business metrics for online advertisers. Captures how effective media investment was in delivering positive value versus how much was spent on that media.
ROAS is especially important to brands who want to identify which aspect of their media spend deserves more budget.
Historically, brands have used ROAS to evaluate the effectiveness of a specific marketing campaign, ad group, and even the overall effectiveness of a specific keyword.
Return On Investment (ROI)
ROI (return on investment), is the calculation to determine how much you earned on a sale after the costs are subtracted.
You simply take your overall revenue and subtract any costs associated with the product to determine your overall ROI.
Money earned from the sale of a product or service.
SaaS – Software As A Service
A SaaS business is a startup or giant corporation offering consumers software to solve their digital problems instead of a physical product like an eCommerce business does. All SaaS businesses run on a subscription model.
The number of affiliates who have driven one sale during a given period is calculated with the formula: Partners who have sales divided by total partners.
Search Engine Optimization (SEO)
The process of optimizing a website to attract organic (un-paid) traffic from a search engine’s results page.
Search Engine Marketing (SEM)
The use of paid advertising and other marketing strategies to increase a website’s position and visibility in search results.
This is most often used in the context of paid search ads, which are ads on popular search engine sites like Google, Bing, and Yahoo
Statement of Work (SOW)
A contract that outlines the work one party will perform for the other.
A company that offers services and support to both brands and affiliates (content creators, bloggers, influencers, website owners, etc.) and helps these “sub-affiliates” monetize their blog, website, social channel, etc. on a cost-per-action (CPA) basis.
Another member within your organization that helps you manage your affiliate marketing program.
A specific action that prompts another action or sequence of action. For example, new click could launch an email.
Total Return on Ad Spend
A measurement of revenue divided by all costs or additional costs relevant to the marketing channel. This could be revenue divided by (commission + paid placement costs + platform costs + agency costs).
Specific code that is placed on a website to track online activity. In affiliate marketing, the links that affiliates use in their marketing content or information to promote a brand has tracking pixel code embedded into it so that the affiliate’s activity – and the performance generated from that activity – can be tracked.
Trademark Bidding (TM+) Campaign
In affiliate marketing, a TM+ campaign is when a brand gives select affiliates permission to bid on their trademark search terms.
This is typically done in exchange for a complimentary paid placement on the affiliate partner’s site and as a way to help brands block competitors/unauthorized bidders and generate incremental exposure.
Henry is a marketing and communications specialist. He enjoys helping individuals and brands find answers to their marketing questions. He has spent the majority of his career in the SaaS industry, gaining experiences in areas such as corporate communications, digital marketing, copywriting, and community building.
Henry currently serves as the head of marketing and comms at Metricks.