Glossary

The world of affiliate marketing has a lot of industry-specific terms. If you are new (or even not-so-new) to affiliate marketing, you may be overwhelmed with all of the jargon thrown around on the web and even a little bit on our site. Sorry. 😊

Below you can find a list of the most common terms and their meanings. We think that after you read this article, you will be an industry expert (or at the very least less confused) 😉.

Core Concepts

Affiliate marketing typically involves two or three parties:

Publisher
Merchant
Network (optional)

If you are not sure what any of those terms mean, see the list of definitions below.

At the most basic level, a Publisher promotes a Merchant's product. If someone buys that product, the Merchant pays the Publisher a commission (usually a percentage of the product's price).

Example #1

Let's look at a simple example where we have a Publisher and a Merchant.

Merchant PetSmart.com (online retailer selling pet supplies)
Publisher PetParadise.com (fictional website which writes blog posts about pet supplies)

PetParadise.com has a website where they write product reviews about pet supplies. Many of their product reviews have links to PetSmart.com however those "plain" product links don't earn any money. PetParadise.com is very popular and they would like to earn some revenue for their hard work.

PetParadise decides to join PetSmart's affiliate program. Once PetSmart approves PetParadise's application to PetSmart's affiliate program, PetParadise now gets access to "special" product links call Affiliate Links.

Now when PetParadise writes a new blog post about a specific product that PetSmart sells, PetParadise uses a "special" affiliate link for that product. When a visitor to PetParadise's website clicks that affiliate link and purchases the product on PetSmart's website, PetSmart knows that PetParadise referred that sale and issues PetParadise a commission. About a month or so later PetParadise receives a commission payment from PetSmart.

Example #2

This example involves the use of a Network.

Network Impact
Merchant BestBuy (online retailer selling electronics, appliances, etc...)
Publisher HiFiReviews.com (fictional website which writes blog posts about headphones)

HiFiReviews.com is a website which writes product reviews about headphones. They have a lot of traffic and want to earn a commission for products they review on their website.

Unlike Example#1 above, the merchant BestBuy does not run their own "in-house" affiliate program. Instead, BestBuy relies on a Network (aka Affiliate Network) to help them run their affiliate program.

In this case, BestBuy uses the Impact Affiliate Network to manage their affiliate program. Impact handles the Publisher sign-up process, getting funds from the Merchant to the Publishers and paying the Publishers when they have earned a commission.

So, HiFiReviews creates an account on the Impact Affiliate Network platform. Once they have created an account, they apply to the BestBuy merchant program using the Impact platform.

Most Merchants will look at the Publisher's website to ensure it complies with their terms and either approve or reject the Publisher's application.

In this case, because HiFIReviews has a website full of unique and valuable content, BestBuy approves HiFiReviews as a Publisher. Once approved, HiFiReviews can now access the affiliate links from the BestBuy program to use in their blog posts.

If HiFiReviews refers a sale to BestBuy, Impact will issue a payment for the commission (as opposed to a payment being sent by the Merchant like in Example #1).

What is the benefit of having a Network intermediary?

On this surface, the introduction of the Network in Example #2 might seem a little complicated. But, the use of a Network in this case actually benefits both the Merchant and the Publisher.

First, it makes managing the Merchant's affiliate program easier because they don't have to track sales and issue commissions. This is all handled by the Network.

Second, the Merchant can get exposure to more Publishers.

Third, the Publisher can be more confident that they will be paid for the commissions they generate.

Finally, the Publisher can also quickly and easily apply to more Merchant programs on the Network's platform. For example, in our example, HiFiReviews could quickly apply to the Walmart program so they can display links to Walmart and BestBuy without creating new accounts. Plus, the Publisher will be issued a single payment for all commissions generated from Walmart and BestBuy.

Definitions

Affiliate ID: This is a unique string of characters (numbers, letters or a mix) that is specific to your affiliate account. Affiliate links typically include your affiliate ID. It allows the merchant to track the source of clicks, sales or leads and attribute the commission to the correct affiliate publisher. Each network will provide you with an Affiliate ID. For more information on how to find your Affiliate ID, click here.

Affiliate Link: An affiliate link is a unique URL assigned to an affiliate publisher by a merchant that allows the affiliate publisher to promote and sell a product or service and earn a commission on any resulting sales or leads.

Affiliate Networks: are platforms that connect affiliate publishers with businesses or brands offering affiliate programs. Affiliate networks act as intermediaries between publishers and merchants, providing a centralized platform for publishers to find and join multiple affiliate programs and for merchants to find and recruit new affiliate publishers.

Click Through Rate: The percentage of people out of the total number of people who click on a link or advertisement after seeing it.

Commission: The percentage (or a fixed amount) of the sale that you earn. For example, if you earn 5% commission and someone makes a purchase through your affiliate link for $50, you would earn $2.50.

Conversion Rate: The percentage of people who take a desired action, such as making a purchase, out of the total number of people who visit a website, click a link or view an advertisement. For example, if 50 people click on your affiliate link, and 10 people purchase that product, you would have a conversion rate of 20%.

Merchants (AKA retailers, advertisers) are businesses that offer affiliate programs to promote and sell their products or services through affiliate marketing. They can range from small businesses to large corporations and can operate in a variety of industries, including e-commerce, finance, travel, and more. For example, Walmart and Petsmart are types of merchants.

Merchant ID: A Merchant ID is a number that is specific to each merchant on an Affiliate Network. Each merchant in Datafeedr's database has its own unique merchant ID.

Publishers: (AKA an affiliate publisher), is someone who promotes a product or service on their website or other digital channels in exchange for a commission on any resulting sales or leads.

SEO: SEO stands for Search Engine Optimization. This is the practice of optimizing a website to increase its visibility and ranking in the search engine results pages (SERPs) for specific keywords or phrases. For example, the ranking of your website on Google.

Sub ID: A Sub ID (AKA Tracking ID) is optional and is a custom value you can add to your affiliate links.It allows you to track additional data (campaign name, source ID, keywords, ....) about the traffic source. The Sub ID values are recorded in the affiliate network's reporting system and let you gain valuable insights into the effectiveness of your marketing campaigns and optimize your affiliate marketing efforts to generate more sales or leads. Most affiliate networks support a sub ID parameter in the affiliate links. Read more

Traffic: Website traffic refers to the number of visitors who access a website over a given period of time. It is a measure of the popularity, reach and the effectiveness of a website. Website traffic can be organic, meaning it comes from unpaid search results or other sources, or it can be driven by paid advertising. By monitoring website traffic, you can gain insights into your audience, improve your website's performance, and optimize your marketing efforts.