How Do Affiliates Get Paid?
Each affiliate program deals with payments and statistics differently. Paying attention to statistics helps affiliates determine what they are being paid and how well their website is selling products. These statistics should be available through the merchant or affiliate marketing program. In general, affiliates will be receiving a payment for the work they do based on those statistics, and the way in which they get paid—that is, what actions or sales get them a commission—determines the amount of their payment.
There are a few different payment models used by merchants to pay their affiliates, which differ based on the product or service being sold. Each program’s payment structure should be clearly spelled out upon signing up as an affiliate. Although there are more complicated payment schemes, there are three basic types. First is the pay per action (PPA) model, which is the most familiar model. In this model, affiliates earn a commission on each sale they make, much like a car salesman. If the affiliate doesn’t make a sale, he or she doesn’t earn any money. The more sales the affiliate makes, the more money he or she can earn. PPA works much like a “finder’s fee,” where the affiliate will secure money if the buyer ends up buying. If not, the affiliate gets nothing.
Another model of payment is the pay per click (PPC) or pay per lead (PPL) model. In this scheme, the affiliate doesn’t necessarily have to secure a sale in order to make money. In PPC, all the affiliate needs is for a visitor to click on an advertisement and the affiliate will earn a small amount of money. If an affiliate hosted banner advertising on his or her site, the affiliate could make money each time sometime clicks on the ad. In the PPL model, affiliates earn an amount of money for each lead they generate for the merchant. The lead can be just a valid email address, but can also be a home address and phone number. The type of information required for a payment depends largely on the merchant.
Finally, there is the lifetime payment model. The lifetime model works in tandem with other payment models and is particularly common in online gambling affiliate programs, though they exist elsewhere, too. In the lifetime model, affiliates can gain a lifetime of commission on each sale they secure. If an affiliate secures a sale from Buyer A, and Buyer A continues to make purchases from the merchant, the affiliate will also continue to make a commission off of those sales.
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