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Affiliate Marketing Uses Cost Per Action Method for Affiliate Payments

Nov 27th 2014 at 9:40 PM

Mobile marketing works according to cost per action. A cost is charged for every action that customers take on advertisements. It revolves around three players that are network, affiliates and merchants.

Network: It provides infrastructure for marketing and also it makes affiliates and finds businesses that want to promote their products and services on mobile market. Role of the network is to keep track of customers from affiliates to businesses.

Affiliate: He is the hero of marketing as it is an affiliate that promotes businesses. He plans promotion and makes effort to promote businesses. His methods are text messaging, social networking, banner ads and videos.

Merchant: Merchant is the beneficiary of the marketing. Affiliates promote businesses and get paid for the business promotion but payment is determined on the action taken by the customers that affiliates send.

The customer clicks on the ad and visit the business promoted by the advertisement. Networks have CPA offers for affiliates. They offer maximum commission to make affiliates and since there are many networks, one willing to join affiliate marketing must explore his options.

How Affiliate Commission is Determined?

Networks determine commission of affiliates and commission is paid according to a formula called cost-per-action. A customer sees an advertisement and finds it interesting. The customer might buy the product or service promoted in the ad or might click back.

What Action a Customer Should Take?

It is the business who determines the action. For instance take a finance company that offers loan. This company would need contact details of customers interested in its offer. It would be ready to pay commission to affiliates that can provide it contact details of its targeted customers. But a travel agent would pay commission only when it earns from the customers.

The commission is determined by the network and it is the network that monitors clicks that an ad gets. Responsibility of monitoring customers that affiliates generate also lies on the network. In short, the network plays mediator between affiliates and merchants. Its role is to help in affiliate marketing.

Different networks have different CPA offers for affiliates. In order to grow, a network has to provide lucrative offers. A network can grow only when it is able to give maximum commission to its affiliates. Affiliates also have to work hard to prove that they deserve top dollar in commission. Affiliates want to join network that has high paying merchants.

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