E-commerce has experienced a huge boom in the past few years. In 2018, the U.S. online commerce market was valued at $517 billion. The competition is fierce due to the large number of startups and old businesses that have adopted digital pathways.
Your online marketing strategy must be strong. Digital/online advertisements are the best way for consumers to be attracted, create demand and facilitate sales.
Cost-per-impression is the traditional method of advertising online. Businesses sign up on platforms such as Facebook to pay a fee. These platforms charge a CPI fee, also known as cost for every thousand impressions.
This fee must be paid regardless of how the user interacted the ad. The return of investment is affected if the conversion rates (landing on the intended webpage or making purchase) are lower. Here is where the CPA steps in.
CPA marketing, also called cost-per-action marketing, is a commission-based marketing model. A pre-negotiated commission is paid to the platform only if there is a concrete action. A user could click on the advertisement, go to the website and make a sale.
This paradigm is based more on actual business results than exposure. The ROI offered by this model is without doubt better than that of the CPI model.
CPA Market Basics
CPA Marketing is a modified form of affiliatemarketing. Ecommerce companies may offer offers or run online marketing campaigns. A affiliate can register for the program to promote the business’ offerings via their blog, website, or social media.
Any action (clicking, watching videos or filling out surveys) is eligible for a commission. Any action (click, watching videos, filling surveys etc.) that is performed through an affiliate’s link makes them eligible to receive a commission at the negotiated rate.
Let’s find out who is who in this model.
- Advertiser: Manages the affiliate program for products promotion.
- Affiliate (or Publisher): Utilizes his network to increase traffic for the business.
- Network This allows affiliates to communicate with the business and manage earnings.
An exclusive tracking code is provided to the company for affiliates. This allows them to track the origin of the action.
CPA Market Considerations for Affiliates & Businesses
1.Relevance:
A well-performing network will have higher traffic. You must make sure your content is relevant. Blogs about car maintenance and spare parts could advertise for businesses that repair batteries or garages. Promoting a mobile phone here is not a good idea.
It’s a two-way road. It is much more likely for affiliates to partner with businesses who are aligned to their interests to generate high-quality leads. This results in better conversion and is a win/win situation.
2.Affiliate Network tie-up:
A top-notch partner will give your business the boost it needs. This market is dominated by well-respected affiliate programs such as Shopify and ShareASale. They are also known for their ability to deliver.
3.Commission Structure:
Ec1ommerce companies need to analyze their data and determine which products require a boost. To make the program more profitable, products identified can be offered a higher commission structure.
New affiliates shouldn’t chase the highest commission product blindly. Your strengths and your followers’ needs should be considered. You can promote beauty products, accessories, and watches on a fashion blog. It won’t help anyone to try and promote a laptop there. A page that has irrelevant content will lose its relevance.
4.Experiment:
Consumer behavior is unpredictable and not always predictable. Affiliates might experiment with different sizes, images, colors, and text. An advertisement that is well placed will attract more attention.
Many users bounce from blogs before they have read the entire article. It is best to not place an ad at or near the bottom of the page. Make sure to use the space between the right and left margins. Continuous visibility drives curiosity.
Companies can adjust their commission rates by offering short-term bonus commissions or other perks.
5.Native Advertising
Try to match the tone and theme of your website with the advertisement. It is not a wise choice to look at advertisements.
6.Data Analytics
Connect your pages to an analytics service. Collect data about clicks, demographics and bounce rates. This data can be used to optimize your campaign.
Businesses may be able to generate steady revenue streams from well-promoted products. It could be counterintuitive to reduce the commission for such products. These products can be cash-cows both for affiliates and businesses. A reduction in commission would affect affiliate earnings and cause members to lose interest.
7.The power and authority
High-quality tie-ups could be a boon. A review from a website that is an authority on your product line could prove to be very valuable.
If you sell protein supplements, offering free samples to the review website for their products may result in a lot more sales at a fraction as much advertising. You can also co-brand.
A trusted reviewer and a well-known product seller can collaborate to create a product description that includes the reviewer’s comments. This will serve as an impartial verification of the product’s quality. Customers will be able to find more information on the reviewer’s site from this description. It is a mutually beneficial relationship.
8.Avoid negativity and adopt simplicity
Signing up for many websites is easy. It takes only a few clicks to complete the sign-up process for many websites. Some sites, however, require immediate credit card and bank details as well as an address.
Potential affiliates will be more inclined to avoid networks that require a lot of information upfront. Signing up for a network that requires a lot of data upfront is not something anyone would desire. All they want to do is promote products.
Look for an affiliate network with easy onboarding, money withdrawal, customer support, and dispute resolution. This will ensure you have a better and more complete affiliate network.
9.Balance
While choosing an affiliate network at the top of the list may offer you the most features, it is not cheap.
It is possible to reduce your costs by choosing an affiliate partner that is cost-effective. You can keep some of the savings and pass on the benefits to the affiliate. Your affiliate partner may take an extra 48 hours to release payment, but he/she will not complain.
10.Affiliate Manager
CPA marketing is a complicated way to make money. You need to optimize your campaign, add new products and remove money-guzzlers. Marketing cost-per-action is dynamic, as are all forms of marketing. To reap maximum benefits, hire a manager to manage your CPA campaign.
Promote your way to success
