Affiliate Marketing Terminology Glossary

When launching your affiliate program, you will come across a myriad of affiliate marketing terms and abbreviations. Below are some of the most common terms you will come across.

Affiliate Marketing Glossary

Ad

Advertiser

Also referred to as the Merchant, brand, retailer or vendor. A company that runs an affiliate program on the Webgains network. They offer products and/or services, which are promoted by affiliates in return for payment for each sale or lead they generate

Affiliate

Also referred to as the Publisher or Partner. An individual or business that promotes another company's products or services in exchange for a commission on resulting sales or leads.

Affiliate Network

A platform that connects affiliates with merchants, managing the tracking, reporting, and payment processes.

AOV

Average Order Value. The average amount the customers spend per order

A graphic image (static, animated, or rich media) that is used mostly on websites for the purpose of advertisement. Banners are most commonly used for brand awareness. See: Program Banners & Assets

Click

Defined as the action taken by a user to transfer them from an affiliate site to that of the merchant.

Clickthrough

The act of clicking a link from an affiliate site, which typically directs the user to the merchant’s website.

Click Through Rate (CTR)

Metric to measure the effectiveness of the ad. Compares how many users click on an ad compared to how many users view it. Calculated as (number of clicks divided by number of impressions) x 100.

Click Target URL

The URL that has been specified as a destination for any user who clicks a specific link

Commission

The amount paid to an affiliate for driving a sale, lead, or other desired action for the merchant. It is usually a percentage of the sale value or a fixed fee per lead.

Conversion Rate (CR)

The percentage of visitors who take the desired action (e.g., making a purchase) through an affiliate link. Calculated as number of sales divided by clicks x 100.

A small data file stored on a user’s device to track their online activity. In affiliate marketing, cookies are used to track when a user clicks on an affiliate link and subsequently makes a purchase. See: How do Tracking and Cookies work in Affiliate Marketing?

Cost Per Acquisition/Action (CPA)

A payment model where the affiliate is paid only when a specific action (e.g., sale,) is completed.

Cost Per Click (CPC)

A payment model where the affiliate earns a commission every time someone clicks on their affiliate link.

Cost Per Lead (CPL)

A payment model where the affiliate earns a commission when a lead form is completed and submitted.

Cost Per Mille (CPM)

A payment model based on the number of impressions (views) an ad or affiliate link receives. Affiliates are paid a set rate for every 1,000 impressions.

Comma Separated Value File (CSV)

A data format in which fields are separated with comma.

Datafeed

Another term for a Product Feed. A file containing detailed information on the product range of a merchant. See: Providing a Product Feed

Deep Linking

A link that takes the user directly to a specific page or product on the merchant's website, rather than just the homepage, enhancing user experience and potentially increasing conversion rates. See: How do I create a tracking link for a program?

Earnings Per (Hundred) Click (EPC/EPHC)

The average earnings for every one hundred clicks that an affiliate generates for a particular program. For merchants, an affiliate’s EPHC displays how well each affiliate is sending relevant traffic to the merchant's websites. For affiliates, a merchant's EPHC shows how well that merchant’s traffic converts into actual sales or leads. This indicator is only to be used as a rough guide and not an exact calculation

Effective Cost Per Acquisition/Action (eCPA)

The metric used to measure the effectiveness of advertising purchased by the advertiser via a cost per click, cost per impression or cost per thousand bases. Calculated as total spend divided by number of sales or conversions.

Impression

A single instance of an online advertisement (such as a banner) being displayed.

Incentive

A benefit offered to encourage users to act in certain ways or perform specific actions.

JavaScript

A scripting language for web pages. Scripts written with JavaScript can be embedded into HTML documents

Keyword

A word or phrase that is used when using search engines or directories. These words or phrases describe or explain the content of a website

Lead

Information that could potentially result in a desirable transaction for a merchant. A potential customer who has shown interest in a product or service by completing an action, such as filling out a form or signing up for a newsletter.

Lead Generation

An activity initiated by a merchant, and undertaken by affiliates to gain user information that can be used for a desirable commercial outcome.

Lifetime Value (LTV)

A bespoke figure for each advertiser considering the value of the customer from their first purchase and any subsequent purchases they make.

Link

A connection to a web page, file or other Internet resource. Clicking a link directs a user to the new location

Merchant

Also referred to as the advertiser, brand, retailer or vendor. A company that runs an affiliate program on the Webgains network. They offer products and/or services, which are promoted by affiliates in return for payment for each sale or lead they generate.

Parameter

A variable that is often appended to URLs in order to pass information. For example, a click reference parameter within a Webgains link could be: http://track.webgains.com/click.html?clickref=012345. See: What Parameters can I use in my Publisher Tracking Links?

Pay per lead (PPL) or Cost per Lead (CPL)

Online advertising payment model in which payment is based solely on qualifying leads

Pay Per Click (PPC)

A pricing model used by affiliates to guarantee an advertisement appears in paid search engine result listings for specific search queries

Product Feed

Another term for a Data Feed. A file containing detailed information on the product range of a merchant. See: Providing a Product Feed

Publisher

Another term for an affiliate; an individual or business that promotes the products or services of an advertiser program.

Recall Period

This represents how many days the merchant has to inform Webgains whether a transaction is not valid. See: What is a Recall Period?

Return on Advertising Spend (ROAS)

Metric that measures the effectiveness of a campaign, calculated as revenue divided by advertising spend.

Return on Investment (ROI)

A measure of the profitability of an affiliate marketing campaign, calculated as profit divided by the total cost. Indicates the amount of money made in relation to the amount of money spent.

Search Engine Marketing (SEM)

The process of marketing a website for improved search engine results, often including a combination of SEO and paid advertising.

Search Engine Optimisation (SEO)

The process of arranging the content of a website in order to obtain high natural rankings in various search engines

Tenancy

A fixed payment agreement where a merchant pays an affiliate a set fee for a specific period to feature their products or promotions prominently on the affiliate's platform. This arrangement guarantees exposure, regardless of traffic or sales generated. See: What is a Tenancy?

Tracking Code

A small list of instructions written in a programming language that is placed on the website of a merchant. This code allows Webgains to track and record any traffic generated for a merchant by a Webgains affiliate. See: Webgains Default Tracking Guide

Traffic

The volume of visitors to a website.

UV

Unique visitor (to a website).