Affiliate marketing is actively developing all over the world. Many companies are moving online and opening affiliate programs. Often, they work through a CPA network with an extensive base of webmasters who are ready to immediately start attracting traffic to their resources.
Let’s take a closer look at what CPA (cost per action) is in marketing and advertising and why this model becomes an excellent source of income for affiliates and advertisers.
What is CPA in marketing?
CPA is a payment model in affiliate marketing, in which the customer (business owner) pays partners for referred customers who perform some targeted actions on their resource. For example:
- The webmaster posted an affiliate link in the story leading to the online store.
- Customers clicked on it, and some of them made a deal or bought something.
- The advertiser (online store) pays the webmaster an agency fee – a percentage of the number of goods or a fixed rate (depending on what rules are specified in the offer).
CPA networks are platforms (aggregators) that bring together advertisers and partners (bloggers, affiliates, marketers). They perform an intermediary mission and provide an opportunity for webmasters to earn money and advertisers to find customers at low prices.
Scheme of the CPA affiliate program
There are several types of CPA networks that differ by niche specification:
- Commodity – most offers here are represented by online stores or companies that sell goods.
- Gaming, mobile – they specialize in offering various games and mobile applications.
- Financial – credits, loans, bank cards (customers are banks and financial organizations).
- Gambling, betting (casino owners, bookmakers).
- Dating, adult.
- Essay – work with an educational niche (term papers, essays).
- Combined – include several verticals presented above.
How CPA networks work
CPA networks promote their products instead of advertisers, doing it as professionally as possible and guaranteeing targeted traffic. Instead, they take a commission calculated according to one or another model. Thus, an effective tool for attracting traffic is created, and advertising pays only for targeted leads.
The main functions of affiliate networks:
- Search for advertisers and partners – they usually post advertising pages and attract representatives from both sides.
- Calculation of targeted actions and analysis of advertising effectiveness.
- Analytics of the work of partners, screening out unscrupulous performers.
- Determination of the most beneficial target actions for the advertiser.
Let us consider in detail how the interaction of the three parties takes place:
- A business owner (advertising) places offers and sets rules (preferred geo, sources, payment).
- A partner (webmaster, arbitrator) finds clients by placing an affiliate link on their sources.
- CPA network provides a platform for interaction between the customer and the webmaster, offers technical support, and charges commissions for its services.
The advertiser is allowed to set a hold – the time during which they will check the reality of the lead or client. Only after that, the reward will be available for withdrawal by the partner. Thus, webmasters themselves will be interested in attracting quality and targeted traffic.
In addition, customers can set some other conditions:
- GEO limit;
- An allowed list of types of traffic, for example, not accept motivated or adult traffic;
- Exclusion of some sources;
- Payment model – for installation, purchase, and registration.
For advertisers, this model provides:
- Higher traffic quality as they pay not for clicks or impressions that are difficult to measure but for specific consumers.
- An economical way to attract the target audience.
- One-time conversion – usually, customers perform targeted actions and then disappear (for example, this often happens during discounts on goods).
However, there may be low returns during a period of strong competition. For example, during holidays, advertising becomes more expensive, and the campaign budget often merges into a minus.
As for affiliates, they get:
- High commissions – since ads get direct results from CPA marketing, they are ready to generously pay for targeted actions.
- A huge selection of offers – most offers are paid for just one of the CPA varieties.
- A relatively simple scheme for draining traffic.
- No need for negotiations, long-term cooperation, and unlimited profit; the more traffic you bring, the more you earn.
The CPA system is an effective sales channel for online stores and other business niches, as well as a good way for partners to earn money. You just need to register in affiliate programs and immediately start sending traffic, receiving a reward for this.