How is Affiliate Marketing Profit Shared? What are CPA, CPL,CFI,CPM and CPS?

How is affiliate marketing profit calculated?

Generally speaking, as long as consumers click on your link and complete what the business wants the consumers to do within a certain period of time after clicking the link (it could be purchasing, or registering, filling out forms, etc.),

After achieving the task, you can obtain affiliate marketing revenue.

Then it will involve two very important questions: [How long does it take to complete to obtain the profit?] and [What needs to be done to obtain the profit?].

Regarding the first question: "How long does it take to complete to obtain the profit?", this must introduce "Cookie Validity Days (Cookie Time)"

• Cookies track the source of the link (you) and tell the store where to send the commission and are embedded in the user's browser when the user clicks.
• The cookie duration refers to the duration of the cookie after clicking, usually 1-30 days.
• Avoid linking to retailers that allocate sales to coupon or cashback websites rather than the original MagicLink click (loss of cashback and coupon commissions).

Because it involves how long it takes to complete the behavior to count as your customer.The valid days of cookies play a very important role in affiliate marketing because it represents the "number of days that consumer behavior can be tracked".

As long as it is within the valid days, the registration, form filling, purchasing, etc. behaviors made by consumers can be tracked by the business owner and are "counted under your link".

That is to say, even if the consumer does not complete the behavior that makes you profitable immediately after clicking your link, as long as they do it within the valid days of the cookie, it is still counted as your customer.

But remember, if the consumer clicks on the link of another promoter within the valid days of the cookie, then the affiliate marketing revenue will be counted as the "new promoter".So the best way is still to have the consumer complete the subsequent actions as soon as they click through your link.

What are the profit-sharing methods of affiliate marketing?

In this paragraph, I will answer the second question earlier: "What needs to be done to obtain the profit?".

This involves the benefits that the business hopes to obtain when looking for you to collaborate and where you can assist them.

For example, if your website has a lot of traffic but has relatively little text and users don't stay long,

Then the click-based affiliate marketing is good for both (because the nature of your website doesn't allow users to stay long and can't perform more complex actions like registering or filling out forms).

In addition to click-based affiliate marketing, there are other affiliate marketing methods. When businesses negotiate affiliate marketing with promoters, the following 5 methods are more commonly used:

1. Pay based on actual sales volume CPS (Cost Per Sale)
2. Pay based on lead numbers CPL (Cost Per Leads)
3. Pay based on specific actions CPA (Cost Per Action)
4. Pay based on download and installation CPI (Cost Per Install)
5. Pay per thousand impressions (reach) CPM (Cost Per Mile) Next, I will introduce to you what different affiliate marketing profit-sharing methods are? How is the profit shared?

Affiliate marketing profit-sharing method 1 - CPS

Pay based on actual sales volume CPS (Cost Per Sale). The full name is Cost Per Sale, abbreviated as CPS.

CPS is the most commonly used profit-sharing method in affiliate marketing at present. It is more similar to a bonus system (profit-sharing bonus).

The commission calculation method of CPS is usually to draw a fixed percentage of the total selling price of the goods you sell as income. As long as consumers complete the purchase action through your recommendation code or link,

After a period of time, the business owner will allocate a certain amount of money to you as a bonus based on the sales volume.

For example, if an online course sells for 2,500 and the profit-sharing ratio negotiated by the business owner with you is 20%, then the promoter can earn a profit-sharing bonus of 500 for each online course sold.

Business owners who adopt CPS affiliate marketing are usually selling "single products", "single courses", certain types of course platforms; or e-commerce platforms such as Amazon and Shopee.

Affiliate marketing profit-sharing method 2 - CPL

Pay based on lead numbers CPL (Cost Per Leads). The full name is Cost Per Leads, abbreviated as CPL.

CPL is slightly different from CPS. The purpose of CPS is to have users "purchase", while the purpose of CPL is to "collect leads".

When consumers enter the form or system through the promoter's link and leave the information the business owner hopes to obtain, then the business owner will give you a bonus based on the number of leads.

There is a big difference in the profit-sharing bonus between CPL and CPS. The previous CPS will draw a percentage based on the sold goods and give a certain proportion of the bonus, so the bonus each time will vary according to the price of the goods you sold;

But CPL is calculated based on the "number of leads", so what you get is a "fixed bonus".

For example, a tutorial class needs the list of consumers so that it can send free course experiences later. So it offers the promoter a bonus of 30 yuan per list. So you can earn 30 yuan for each person who fills out the list.

Affiliate marketing profit-sharing method 3 - CPA

Pay based on specific actions CPA (Cost Per Action). The full name is Cost Per Action, abbreviated as CPA.

CPA is a bit like the combination of CPS + CPL mentioned earlier. You need to complete both "lead collection" and "purchase action" to obtain the affiliate marketing reward.

At present, most virtual currency exchanges and overseas brokerage firms, etc. belong to the CPA affiliate marketing profit-sharing method. Users need to simultaneously satisfy the actions of registration, deposit, or trading to buy stocks before the promoter can earn money from the users.

CPA, based on the discussion method between the business owner and the promoter, can also be divided into the differences of one-time and multiple times (RS).

The one-time CPA affiliate marketing plan is that as long as the user completes the registration and deposit, the business owner will directly pay a one-time amount to the promoter. No matter what the user buys later, it has nothing to do with the promoter.

The multiple-time CPA affiliate marketing plan is that after the user completes the previous registration and deposit, for each transaction, the business owner will pay a certain proportion of the transaction fee to the promoter. So the promoter can keep obtaining revenue.

For example, the sub-agent plan of the virtual currency exchange Pionex belongs to the CPA affiliate marketing method. Through transactions, it provides a maximum of 40% of the transaction fee drawn each time. Some people's annual income can reach more than 1 million.

Affiliate marketing profit-sharing method 4 - CFI

Pay based on download and installation CPI (Cost Per Install). The full name is Cost Per Install, abbreviated as CPI.

The purpose of the affiliate marketing of CPI is that "the business owner hopes that consumers download the App or software and use it". So as long as the consumer downloads the software the business owner hopes and uses it, the business owner will send a fixed bonus to the promoter.

This bonus system usually appears on "delivery platforms", such as the recommendation links of UberEAT and Foodpanda, which all belong to the profit-sharing method of CPI affiliate marketing.

As long as the user downloads and uses it once through your link or code, the platform will give you a discount to use.

Similar to CPL, the profit-sharing method of CPI is to give a "fixed bonus".

Affiliate marketing profit-sharing method 5 - CPM

Pay per thousand impressions (reach), The full name is is Cost Per Mile, abbreviated as CPM.

The profit-sharing method of CPM is calculated based on how many times the affiliate marketing link of the promoter is "clicked". It can help the business owner track the exposure status of the link and know how many people are interested in this advertisement.

The profit-sharing percentage or amount of CPM will be a little lower than other profit-sharing methods because only "clicking" is easier to achieve than behaviors such as "registration", "filling out forms", "deposit", "transaction and purchase", etc.

Its calculation method is usually calculated based on the bonus that can be shared for every thousand clicks.

For example: For every thousand clicks, the business owner gives you a bonus of 50 yuan, then your CPM profit-sharing ratio will be 0.05 (50/1000).

How to choose the profit-sharing method?

After knowing the differences of the above different profit-sharing topics, then let me share with you which profit-sharing method might be more suitable for you.

If your website or social community page is of the nature that the audience has a high click rate but not much in-depth communication, then CPM will be more suitable for you because CPM only looks at the click rate and not the subsequent more complex behaviors.

If there is information exchange between the audience and you on your website, and you often do reviews, unboxing, etc. sharing, then CPS, CPA, CPI, and CPL are all suitable for you.

Because the previous four all require users to stay in the link and perform some designated actions, it depends a lot on "trust in you" and whether you can bring vivid and good textual explanations.

Among the above four, especially CPA should be mentioned to you because CPA can also be divided into two different natures of affiliate marketing plans: one-time and multiple times.

If possible, it is best to negotiate with the business owner for a "multiple-time CPA affiliate marketing plan". If it is one-time, you earn money only once after the user completes the task, and you can no longer earn money from this user later.

But if it is a multiple-time plan, then each subsequent action of the user can bring you a certain proportion of the revenue. This is also the so-called "financial freedom".

When the number of people increases, the accumulated benefits can be very considerable.