Affiliate Marketing Guide: What Are Conversions And How Can I Get Some
If following our “online money makers” article you joined some affiliate networks, most probably you have encountered terms like “conversions” and “impressions”. Are they clear to you, or you got a bit confused?
One of our readers asked me a question which determined this post:
“I’ve got a lot of impressions so far, but I don’t know what conversions are and how can I earn some. Can you explain this for me, please? I guess that conversions are the ones which make the online money, right?”
OK, let’s take for example some screenshots from NeverblueAds, one of my best performers in affiliate marketing:
- Network Earnings is an index based on the total earnings of a campaign, relative to the total earnings of other campaigns on the network. This doesn’t mean that you’ll necessarily earn more if you choose one of the programs (campaigns) which have bigger network earnings. It can be a sign that the campaign is used by a lot of affiliates, thus making your life harder.
- EPC: Earnings Per Click, measured network wide. This means the average money made per every click on that campaign’s banners and links, average computed taking into consideration all members of NeverblueAds. This can be an indicator of how much you could bid in a PPC campaign, in order to make it profitable.
- Let’s suppose we have this campaign with an EPC of $1. It means that for every click on your affiliate ads, you get an average of $1. If you set up a PPC campaign in Google AdWords, or Yahoo Search Marketing, or whatever other PPC network, and you choose a bid of $1 per click, then you’re even. Zero profit. Work for nothing.
- But if you choose a bid of $0.50, for every click you earn an average of $0.50. Profit!
- This is why for highly competitive keywords you cannot set up profitable PPC campaigns – your ads will not show, because the big sharks (super affiliates) out there have special agreements with the advertisers, so they get much better deals than you.
- Here I suspect another thing: the super affiliates lose money on purpose, only to build themselves the image of big marketers, running huge budgets. The affiliate networks are happy to have them aboard because they bring them good money, and the poor, rich, super affiliates get even on our back, by selling us their wisdom, garnished with loooong sales letters, and poured in fancy e-books which sometimes are worth the money you pay, but many times they aren’t.
- Lead: how much money you earn when a lead is generated from your affiliate link. A lead means usually the completion and sending of an online form, with no monetary obligations for the person who does that.
- Sale: how much money you earn when a sale is generated from your affiliate link. A sale means that the visitor who arrived on that merchant’s website by clicking on your affiliate link, will have to buy something in order for you to get paid a commission.
Now let’s take a look at the report for one of the campaigns I’ve run. The campaign consisted of a banner in the sidebar of a blog.
- Impressions: the number of times the banner was displayed on my blog. As I had the banner in the sidebar, thus displayed on all pages, this number is equal to the number of pageviews my site received for that period of time.
- Clicks: this is clear, the number of times somebody clicked the banner ad in my sidebar
- Conversions: how many people of the ones who clicked performed that action I was paid for (in this case, it was a pay-per-lead campaign; visitors had to fill in a form with their name and email address and submit it). You see that only two people actually submitted the form, out of the 36 who saw the advertiser’s landing page (= the page where the link attached to the banner was leading).
- Avg. CPA: Average cost-per-action. This means how much money I got on average for each person who completed the required action (in this case, submit the online form).
- Revenue: the average CPA, multiplied by the number of conversions. This means how much money I made out of this campaign.
- Conv.: Conversion Rate. The percentage out of the total number of persons who clicked the ad, who actually completed the required action (submitted the form)
- In this case, of displaying affiliate banners on their websites, affiliates cannot influence directly the conversion rate. This rate depends on the quality of the advertiser’s website, which you cannot change (but if the conversion rate is poor, you can change the advertiser
) - However, in the case of PPC campaigns, it seems that the position where your ad is shown on the search results page may influence the conversion rate. The only way you can determine this is through testing various bids, thus various positions, and see which one converts better. Between the lines you should have read “lose money”. Yes, with the tests you spend more than you earn, but once you established a result which works, you’ll recover your money from the real campaign.
- In this case, of displaying affiliate banners on their websites, affiliates cannot influence directly the conversion rate. This rate depends on the quality of the advertiser’s website, which you cannot change (but if the conversion rate is poor, you can change the advertiser
- EPC: earnings-per-click. This is how much money I earned on average per each person who clicked the ad.
- For this case, you can see it is $0.13.
- I could have set up a test: replace this affiliate banner with an AdSense ad unit of the same size, and place it in exactly the same position.
- If after the same period of time I get an average EPC bigger than $0.13, this means that running AdSense on that spot is more profitable than running this affiliate campaign.
As a conclusion (one of the many), the more clicks you get, the more conversions you will have. The more impressions (page views) you have, the more clicks you’ll get.
So we came back to the traffic which is so hard (or so expensive to get). Traffic makes online money for you, so you may want to revise again these free traffic sources for your blog.
What you can influence, is the clicktrough rate from your site: make more people click the banner. For this, you have to make again some tests: put the banner is various positions across your page layout, and keep it in each position until you get the same number of impressions for all cases. Then see which case brought you the most clicks. That’s the best position.
Special mention: please be aware that 2 clicks are not enough to conclude a test. Generally speaking, the bigger the numbers, the more accurate the test.
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Excellent article, thumbs up!
Patrick’s last blog post..Guest Post on Geeks Are Sexy
Thank you, Patrick, we appreciate that!
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Great writeup. Traffic is really the fruit of all earnings. Some people need to understand that.
impNERD’s last blog post..Guest Posting
You are right, impNERD. Almost everything else is related to traffic. Even tests are not possible without traffic.
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Good article. I’ve been getting clicks but no conversions so far
Michael Aulia’s last blog post..My First Google AdSense Check
Affiliate Marketing Guide: What Are Conversions And How Can I Get Some…
An introductory guide to affiliate marketing terms, with explanations illustrated on examples from my experience with NeverblueAds network. Read about impressions, conversions, leads and sales….
Hello all, long time reader first time poster here
delighted to be a member, and I can’t wait to start getting more active here
In the mean time look at my site http://articlesubmissiondirectory.goingonline.co.za/2010/10/13/search-engine-optimisation-8-common-mistakes/
Pay per sale are the hardest to earn at