Advertisement:
the graphic or text file(s) contained in
the xyz company network which are available for Publishers' use.
Advertiser: the advertiser or advertising agency providing advertisements to
xyz company
for use on Publisher's Web site(s) as specified by the xyz company.
Affiliate: An independent party that promotes the products or services
of a merchant in exchange for a commission. Also sometimes termed an associate,
partner, reseller, or referral partner.
Affiliate Program: Used in a broad sense, an affiliate program is any
type of revenue sharing program where an affiliated web site receives a portion
of income for delivering sales, leads, or traffic to a merchant web site. In a
narrow sense, affiliate programs are commonly considered those programs that use
a pay-per-sale model. Also termed associate, partner, referral, reseller, or
sponsor programs.
Banner Ad:
A graphical web advertising unit, typically a large headline or title extending
across the full page width often measuring 468 pixels wide and 60 pixels tall
Banner
Networks: Most pay-per-click programs are part of a network where the
network acts as middleman between the actual advertisers and the affiliates
which run the ads. For this, the network takes a cut of the revenues.
Click-Through: the number of
times, as recorded by company's server, a user directly interacts with (i.e.
clicks on, mouse over) an advertisement linked for transfer to the advertiser's site or
suggested destination. Advertising campaigns conducted on a cost per click basis
are known as "CPC". Click-Throughs are counted for unique, valid users
normally within a twenty-four (24) hour period.
Click-Through Ratio: The percentage of visitors who click-through on a
link to visit the merchant's web site. Higher click-through's are preferable
albeit not always a measure of success. Click-through ratios can be improved
through a variety of means including: making links more visible to visitors,
adding personal comments or testimonials about the benefits of a product, or
even reducing the number of possible links that a visitor can follow.
Commission: An amount of income you receive for generating or referring a sale, lead or
click to a merchant's site.
Company: XYZ, Inc. d/b/a (doing business as) xyz.com.
Conversion ratio: The ratio of visitors from your site that are
'converted' to a sale, lead or click, and go on to earn you a commission. A
conversion ratio of 5% would mean that for every 100 visitors to your site, 5
would click-through, make a purchase and earn you a commission. Many factors
will influence the conversion ratio including: how targeted the affiliate
program's products are to your visitor's interests, the price and value of the
products or services being promoted, the merchant's ability to successfully
track all referred sales, and the professionalism and comfort-level the
merchant's site provides to potential customers.
Cookie: Cookies are small files placed and stored on the visitor's computer that
record information that is of interest to the merchant site. Despite concerns
some people have, cookies are not dangerous, and can not be used to steal names,
email addresses, phone or credit card number. Used with affiliate programs,
cookies have two main functions:
1) to track what a visitor purchases and,
2) to track which affiliate made the referral.
Be wary of programs which ONLY use cookies since they have many inherent
limitations: they can be turned off by the visitor, they expire after a certain
date or time, and they can be deleted off the visitors computer. Most programs
use either unique URLs or affiliate ID numbers in conjunction with cookies to
track properly. Cookies can then be used to give the affiliate credit at a later
time of purchase, even if the visitor doesn't click-through from the affiliate's
site again.
Cost Per Action: Advertisers pay for every time a specific action is
taken. For example, you may pay on a per click or per order basis. These types of buys
compensate the sites for the performance of advertisements, but since the site
has no control of the ad copy or the product, it also doesn't have control over
how well the advertising works. Sites also feel that if advertisers are only
paying on a cost per action basis, there is no compensation for the branding
exposure advertisers receive. However, this is a great buy for advertisers, if
they can negotiate it. Most sites
don't like selling advertising on a per action basis.
CPM:
The practice of calculating a cost per thousand ad displays. It is used with
programs that pay on a impression basis, with the CPM rate being the amount you
earn for every 1000 times an advertisement is displayed. For example a $5 CPM
means you earn $5 every time 1000 ads are displayed on your site. CPM can also
be calculated for pay-per-sale, pay-per-lead and pay-per-click programs.
Calculating the CPM of affiliate programs can be an effective way to means of
comparing results over time from various programs, allowing you to put more
emphasis on the strong programs, and dropping that do not perform well.
Double Opt-In: the Web site may not use a user's
collected information unless the user specifically directs the Site to do so and
also receives and responds positively to an e-mail confirmation from xyz
company.
Impression: the number of times an advertisement is
served to a user. Impressions shall be measured by xyz company in accordance with
its standard methodologies and protocols. Advertising campaigns conducted on a
cost per Impression basis are known as "CPM".
Merchant: A company that has set up an affiliate program and has agreed
to share a commission with affiliates that promote their site, products or
services.
Opt-in: the consumer has made
an active, affirmative choice to select the advertisement in question in order
to be counted as a unit. Forced, negative choice, passive, opt-out or other
types of non-active, non-affirmative choice actions are NOT "opt-in".
Opt-out: the consumer is not required to make an active and/or affirmative
choice to select the advertisement in order to be counted as a unit. The web
site may use a user's collected information unless the user specifically directs
the site not to do so.
Pay-per-click: A program where you receive a commission for each valid
click (traffic) you refer to a merchant's web site. Pay-per-click generally
offers low commissions (range of $0.01 to $0.25 per click), and a very high
conversion ratio since visitors need only click on a link to earn you a
commission.
Pay-per-impression: A program where you receive a commission each time a
merchant's ad or link is displayed on your site. Pay-per-impression generally
offers the lowest commissions, but a nearly 100% conversion ratio since a
visitor merely has to view the ad to earn you a commission, often resulting in
the highest earnings potential. Pay-per-impression programs are generally
measured in CPMs (see below) and form the standard of banner advertising for
larger sites.
Pay-per-lead:
A program where you receive a commission for each sales lead for a product or
service that you refer to a merchant's web site. Like pay-per-sale, also referred to as a
Cost-per-Action( CPA).
Pay-per-sale: A program where you receive a commission for each sale of a
product or service that you refer to a merchant's web site. Also
referred to as Cost-per-Action (CPA) and generically as an Affiliate Program.
Residual Commission: Residual commissions refer to programs that provide
affiliates the ability to earn an income month after month for referring a sale
to a merchant. They are generally programs that offer some type of service for
which the customer is charged a monthly subscription fee. Examples include web
hosting, telecommunications, and e-commerce solutions. They offer an effective
benefit to affiliates since the affiliate can earn income for an extended
period, perhaps even years, from one sale.
Start Date: the first day your affiliation begins with xyz company which now
allows you to advertise the products or services for that company within their
"Terms of Use Agreement".
Stop/End Date: the final day your affiliated with xyz company.
Third-party Administrators: Similar to banner networks, most act as consultants and software providers to merchants, allowing
the merchant to cost-effectively outsource their affiliate program operations.
For affiliates, the networks often offer simplified registration, standardized
commission tracking and reporting, and even consolidated check payments.
Two-Tier Commission: Two-tier, or multi-tier, refers to the practice of
an affiliate merchant paying commissions to both the affiliate that referred a
sale, lead or click, and also to the affiliate that referred that affiliate to
the program. A derivative of multi-level marketing, two-tier programs are
generally quite legitimate and offer the merchant an effective way to promote
their program quickly.
Tracking method: Tracking refers to the way that a program tracks
referred sales, leads or clicks. The most common are by using a unique web
address (URL) for each affiliate, or by embedding an affiliate ID number into
the link which is processed by the merchant's software. Some programs also use
cookies to track sales.
Unit: a user's completion of the
act requested by the specific advertiser supplying advertisements. If a user is directly compensated for completing such required
action, such action is not considered a unit.
User: any person accessing a web site or electronic mail
services.
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