When it comes to marketing an online business, return on investment (ROI) is the key to success.
Take digital advertising as an example. Once your hard-earned marketing funds are invested in Google or Facebook advertising, you need to carefully optimize your campaign test, customize it, and hope that all your clicks will eventually be converted into sales revenue.
Once gross profit, shipping costs and other costs are taken into account, it is difficult to maintain a high enough return on investment to maximize your marketing efforts.
What if we can only spend money on real business results (leads, conversions, and sales) instead of focusing digital advertising on "awareness metrics," such as impressions and clicks?
This is where CPA marketing comes in.
Cost-per-acquisition marketing is probably the most scalable and profitable return on investment to make money from a website.
Unlike other marketing strategies, in this marketing strategy, you can promote your brand without a sales guarantee without paying, while CPA marketing allows you to pay only at the price set after the sale.
For example, if you sell sneakers for $ 100 and pay a 10% commission CPA partner after the transaction have to pay only 10 USD for marketing expenses and you can enjoy a return on advertising investment (ROAS) 10: 1.
This it is a considerable comeback.
In addition, it is well known that the annual expenses of these members are 58% higher than the total of all other advertising channels.
This introductory guide will guide you through the workings of CPA marketing and cover:
What is CPA marketing?
How does CPA work?
Market CPA payment model.
Best associated CPA network.
Improve rewarding techniques for cost-per-acquisition strategies.
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What is CPA marketing?
CPA marketing, also known as price marketing, is an affiliate marketing model that offers commissions to affiliates after completing certain operations.
The main action can be from buying to getting an offer, watching a video or filling out a form.
Ecommerce sites around the world can use CPA marketing to create various online marketing offers and activities.
The CPA network then promotes these campaigns through members.
Every time a posted visitor completes a campaign or offer, CPA affiliates must pay.
How does CPA marketing work?
When you break down the working principle of the CPA model and the people involved, the CPA model is a simple concept.
Affiliated companies or publishers: influencers (blogs, brands, companies) who promote companies or products to drive traffic to e-commerce sites and make specific conversions.
Company or advertiser: A brand that wants to cooperate with the affiliate marketing network to increase the quality of traffic to the company's website and increase sales, generate leads or increase conversions.
CPA Network: A platform that brings together branches that want to make money by promoting their products and companies that want to promote their products.
Suppose the popular cooking blogger Lisa (our affiliate in this story) maintains a healthy focus on YouTube subscribers and blog readers.
She learned how to start a blog to earn a living in the kitchen - she tried new recipes and recommended certain brands and products to her audience.
After developing a blogging strategy for guests, increasing online visits and creating an admirer, her culinary crowd wants to buy the following kitchen utensils she recommends.
Then we have the EasyCooking case.
EasyCooking produces high-quality kitchen utensils - from cutting boards and measuring cups to professional blenders and food processors. They want to expand their market coverage and hope to take advantage of Lisa's aspiring chef community.
The CPA marketing network combines Lisa and EasyCooking.
Ecommerce companies like EasyCooking use the CPA network to find and collaborate with influencers like Lisa.
Influential people like Lisa who want to make money and attract their audience through their love can turn to the CPA network to find companies that are willing to pay her to use and promote their products.
Lisa attracts the public to the company's website and earns commissions for every sale or conversion of potential customers.
On the other hand, EasyCooking uses Lisa's referral traffic to make money.
The network brought them together, and the public tested new products and found out about the new brands. This is a win-win situation.
CPA NetworkThe CPA network term is not complicated, but you need to understand a few key terms at startup.
Member Manager: The person who manages the merchant's membership plan. They are responsible for recruiting, cooperating with members and generating income for business people.
Category: CPA market segment (sports, fashion, beauty, health, etc.).
Refund: When sales of a particular behavior "decrease", the affiliate has already paid. Since the sale was never completed or the product was returned, the previously paid commission will be deducted again from the advertiser's account.
Commission: Payment received by the branch after a successful conversion (a one-time payment or a percentage payment).
Content link: A text link from the partner's site to the advertiser's site.
Conversion rate: the percentage of a specific action performed. In other words, the number of successful conversions divided by the total number of clicks.
Cookies: In affiliate marketing, cookies are used to assign unique IDs to users who click on links to advertising sites within a specified period of time. The branch will receive credit for the conversion within this predetermined period (usually 30-90 days).
Cost-per-action (CPA): An online advertising strategy that allows advertisers to pay targeted customers for specific actions.
Earnings per click (EPC): The average amount a member earns each time a user clicks on the affiliate link.
Bidding page: A website where visitors convert after performing the necessary actions.
Return on investment (ROI): refers to the income from a campaign. This is the advertising revenue divided by
100. CPA Payment Model The CPAmethod
affiliate marketingis beneficial for companies because if the conversion fails, the company will not pay.
Payments vary depending on competition and the average commission rate for each industry.
For example, the successful membership program of the headset maker Skullcandy offers a sales commission of 5% based on competing electronic product categories.
The outdoor camping company Kelty provides a commission structure of up to 10% to its branches. It all depends on the competition in your industry.
For advertisers, the cost-per-campaign formula is a very low-risk method, because they only pay for it when the action is needed. Unlike paid traffic, for example, you only have to pay to direct users to your site through advertising.
The cost of each campaign for the advertiser can be determined by dividing the total cost of the marketing campaign by the number of successful operations.
Take our EasyCooking conversion company as an example.
If EasyCooking spent $ 1,000 on marketing activities and successfully completed 25 conversions on the e-book prescription form, the cost per operation would be $ 40.
Although the cost per operation is different for each industry, Google AdWords reports that the average cost per operation for all industries is $ 48.96.
The automotive industry has the lowest CPA at $ 33.52.
The maximum cost per conversion for this technology is $ 133.52.
The top 10% of advertisers have a cost per conversion up to five times higher than average.
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What Are The Benefits Of CPA Marketing Through?
If you target the right target group (as an affiliate) and connect with quality influencers (as a company), CPA marketing can be very profitable.
Compared to other e-commerce marketing channels, the cost-per-operation formula has many advantages, including:
1. Easy to set up.
CPA marketing is an easy start: all you need is a website and a CPA network.
To use this marketing technique, very little capital is needed.
There is no doubt about how to get started when working with a trusted CPA affiliate network.
By using your own website and choosing cost-per-purchase bids, you can start getting traffic from partner sites almost immediately.
2. Payment after sale.
You do not have to pay for unconverted traffic.
If member referrals consistently offer lower conversion rates, branch out to your members and focus on more successful influencers.
3. Low risk.
Because if the introduced visitor does not become a customer or does not perform a specific task, the issuer does not have to pay, so the risk to the e-commerce company is low.
There are tools like Mentionlytics that can help you monitor how members market your brand or products, but the cost of acquisition for marketing does not require much time or capital investment.
4. High return on investment.
Affiliate marketing generates 16% of total online marketing.
The perspectives of the members of the Conversant, CJ clients revealed that the clients spent more money on the recommendations of the member companies.
This means that such marketing activities can improve the quality of traffic and provide greater value compared to most traffic sources.
Affiliate Marketing Generated:
Average customer revenue increased by 58%.
On average, it is 31% higher than customer orders.
The average order value (AOV) is 21% higher.
In addition, the more you sell, the higher the commission. For example, the BigCommerce affiliate program starts with 200% spending and then increases sales.
5. Expand the field of marketing.
Cost-per-acquisition marketing can give you quantity and distribution.
You can communicate your brand message to as many audiences as possible and consistently.
Whether your brand is fashion, electronics, home and garden, pet items, beauty or other products, CPA marketing is used in most areas of business.
For example, take Bliss, the skin care and beauty product line.
Their affiliate marketing program provides a 10% conversion cost for all sales.
Beauty influencers, bloggers and media sites now have the tools to easily promote them, charge a 10% commission on all sales and expand their market coverage.
In every industry, there is almost always a partner site that can offer partnerships through the CPA partner network.
Contact the target groups of the alliance (groups you've never met before) to expand your brand awareness.
Tips and Best Practices
CPA MarketingCPA affiliate marketing is not a definitive method.
You need to spend time building relationships with CPA members to create strong conversion channels that will continue to increase conversion rates.
To successfully implement a CPA marketing strategy, please try the following tips:
1. Consider hiring an affiliate manager.
To get the most out of your CPA marketing efforts, you need dedicated internal resources - people who can hire new CPA members, work with website owners, send them new promotions, and generate continuous revenue for the site. your web.
The branch manager can help the branch today by reviewing
branch products and getting information about strategic changes.
Learn about the types of relevant links or ads you use to optimize your conversions.
Provide content suggestions to effectively promote merchant products.
Send new product updates and ads to CPA members.
Offer commissions and rewards for highly successful CPA members.
A branch manager can help advertisers take the following steps:
connect with you and hire the most successful branch in their niche market.
Consider new promotional ideas for specific products.
Send consistent brand information and product updates to the CPA network.
Negotiate contracts with members, monitor the return on investment and compare the membership plan with other companies to stay competitive.
We'll guide you to the best affiliate programs and websites to establish good link ads.
Process taxes and set up your accounting services.
2. Avoid poor evaluation of the CPA ad network.
The disadvantage of CPA marketing (as with any online earning opportunity) is the dubious network, and its practices are unreliable.
Please read the reviews before joining any CPA affiliate marketing network.
Odigger offers online reviews, so you know which ones are worth the time and which should be avoided.
Remember, no network will get 100% satisfaction, so one or two complaints won't scare you.
The most popular topics with negative scores include:
underpayment (keep in mind that even reputable CPA marketing networks may refuse payment for specific reasons, so please check your network policy before registering).
Unnecessary branch administrators.
There was a problem connecting to the network or using the platform.
3. Use the original creative.
The era of embedding ugly banners on your website is over.
They don't need advertising to convert customers.
In fact, natural or color-like ads, the look and feel of your website are market trends to follow in 2020. This year,
spending on non-social housing will increase by more than 80% to 8.71 billion. of US dollars. US dollars
Of the total revenue from mobile display ads in, 77% will go to organic placements.
eMarketer predicts that in 2018, internal advertising will account for almost 60% of advertising spending displayed in the US.
Integrating your ads into a high-quality web design will bring more conversions, as the visual emphasis of natural ads is twice as high as that of banner ads.
CPA Marketing Trends CPA marketing trends from
the hottest2020, your revenue will increase and help you develop a strategic approach to next year's digital marketing plan.
CPA marketing is expected to expand in developing countries in 2020 and beyond.
CPA marketing should focus on copying rather than pop-ups and headlines.
Influential marketing will begin to overlap with CPA marketing, which gives many new e-commerce companies more reasons to join the CPA membership network.
E-commerce companies will shift some of their budget from traditional marketing (PPC, social media and banner advertising) to affiliate marketing and performance.
The trusted CPA affiliate marketing network will continue to increase transparency and provide data-driven information that customers need.
CPA marketing is the next step in the digital marketing that market-oriented marketers are looking for.
This is a fast and friendly collaborative optimization strategy that puts real business results first.
This is a way to expand and disseminate brand information while building a strong relationship with partner sites.
This flexible, easy-to-use strategy is also useful for members, as they can choose offers that reflect their brand and website, allowing them to use banner ads and contextual links to evaluate the content on their website. their web.
To expand the coverage of your website, maintain a strong return on investment, and feel the real impact of your business, incorporate CPA marketing into your strategic plan.