How Does Affiliate Marketing Work?

What is CPA Marketing?

Cost Per Action (CPA) Marketing is a marketing model in which a commission is paid when a user takes a specified action. It is also referred to as Cost Per Acquisition Marketing. Actions (or acquisitions) include a wide range of options for the marketer, including everything from clicks, to form fills, installs, purchases, and more. CPA marketing is also a broad term that encompasses numerous other Cost-Per pricing models, including CPS, CPL, CPI, CPE, and CPC.

Affiliate marketing definition

Affiliate marketing is the process by which an affiliate earns a commission by driving traffic to a marketer’s product or service. Affiliate marketing is known as a type of performance-based marketing, as a marketer only pays when there are genuine, measurable results.

Performance marketing definition

Performance marketing is an umbrella term that encompasses any kind of marketing that is performance-based. More granularly, performance-based marketing refers to marketing programs in which marketers (a.k.a. advertisers, brands, retailers, or merchants) pay affiliates (a.k.a. publishers or partners) either directly, or via a performance marketing network or agency when a specific action is completed.

To help differentiate from other marketing tactics, just remember that with performance marketing, you only pay when your desired action is completed (sale, lead capture, etc.). If there isn’t performance, you don’t pay.

Pro Tip:

Additional CPA Marketing Terms You Should Know

Affiliate:

An affiliate, also known as a partner or publisher, is a third-party individual or company that promotes another company’s product or service in return for a commission, and can exist anywhere along the performance marketing funnel. Apply to be a Perform[cb] Affiliate.

Advertiser:

Also referred to as a marketer, brand, or retailer, an advertiser has a product or service to promote or sell. Advertisers utilizing CPA marketing have defined customer acquisition goals with a focus on metrics and continued campaign optimizations. Apply to be a Perform[cb] Advertiser.