Affiliate Marketing VS CPA Marketing – Pros And Cons Of Both!

What’s up ENTRE nation, Jeff Lernerhere. And in this video we’re going to be talking about affiliate marketing.It’s one of my favorite subjects. It absolutely pretty much saved my lifeback in 2008 when I was at a really low point and I needed a way to make somedecent money and affiliate marketing was there. So I really love talking aboutit. I love teaching about it. I talk about it, you know, actually fairlyoften on my channel, but in this video in particular, we’re going to be lookingat CPA marketing and sort of understanding what makes it a littledifferent or more varied from traditional affiliate marketing. Um, andkind of breaking it down and saying, is it, you know, is it better? Is it worse?Is it, you know, it’s better for certain people, maybe not as good for otherpeople.But this term, CPA marketing is one that you’ve likely run into ifyou’ve gotten into the world of affiliate marketing and you may havewondered, well, what exactly is the difference? Okay, so let’s talk about. Okay, so let’s talk affiliate marketingand in particular CPA marketing. First, I do want to ask you if you haveinterest in generating income on the internet, building a business, honestly,just improving your life all around and taking advantage of the amazingopportunities that populate our world today to have a non traditional andbetter than historical quality of life because we have freedom, we have flexibility, wehave travel, we have ways to make money on the internet. We have ways to getleverage for the average person. All this stuff that hasn’t actually existedthroughout history for most people. If you’re interested in those things, thatis what my channel is dedicated to.I am on a mission to teach as many people aspossible, how to have as amazing a quality of life as possible and if youthink that might be something you’d like to know more about, then I’ll ask youagain to subscribe to my channel. Make sure you click the little bell so youget notified when I release new videos. Which happens usually about every otherday. That said, let’s get into the topic at hand. Affiliate marketing and inparticular CPA marketing. So first of all, what is the overall concept ofaffiliate marketing? If you’re new to it, I will say, welcome.It’s really,really awesome. So I’m glad you’re here to learn about it. Basically affiliatemarketing is like getting paid for work that other people did most of. So youthink about what goes into starting a business or to having a business andyou’ve got to, you know, you’ve got to create products, you’ve got to createbranding, you’ve got to create marketing materials. You gotta have saleshappening. You got to support the customers. You gotta have fulfillment,you gotta maybe have inventory and shipping and maybe have employeesyou’ve got, there’s just like all this stuff, right? That goes into running abusiness. Well, basically out of everything that I just describedaffiliate marketing says you can ignore all of it except for one piece, which issales. Let the businesses out there, the people that create products and servicesare what we, on the internet, we typically use the term offers. Thecompanies that create offers, let them do all the work to create these offers.And then you as the affiliate, all you have to do is get people to the offer sothat sales can happen.Now, you don’t even have to be in sales. Being anaffiliate marketer isn’t being in sales. You’re not actually doing the selling.The company is still responsible for creating materials, marketing, and salesmaterials that, you know, create the demand for the product, educated aboutthe product, and actually convert your traffic or leads that you get to theproduct, convert those into sales.You don’t have to create the salesmaterials. You’re just responsible for getting people in the door so that salescan happen. That’s basically affiliate marketing and it’s essentiallyeliminating, I would say 90% of what goes on in running a business. And infact I half jokingly say affiliate marketing is basically the lazy person’sbusiness model. Um, and the reason that’s only half a joke is becausethere’s still a lot of skills to learn to be good at it.But honestly, most of the affiliate marketers I know and and I am, I’mmyself and I’m an affiliate marketer, but I do other things too.I built anagency. I run an education company called ENTRE. I do YouTube videos. I doa lot of stuff. You know, to the extent that I’m an affiliate marketer, I’ll ownit. I’m actually pretty lazy and the guys I know that are full time affiliatemarketers, they may work very hard at their skill and their craft as anaffiliate marketer in terms of lifestyle, they have a very comfortablelifestyle. Affiliate marketing is like the ultimate lifestyle business. Ifyou’ve spent any amount of your life thinking, man, I’m working way too hard,I want to encourage you to really learn about affiliate marketing because Ipromise you, if you are a successful affiliate marketer, at no point when youlook at your life and go, man, I’m working too hard. This is, this is like,this is too grueling or too intense. No affiliate marketing is like the mostchill business there is, but you have to be smart and you have to.You do have tobe diligent and disciplined and work hard to get good at it. But once you’regood at it, like it’s about as good as they come in terms of the, the effortrequired in the compensation that you can produce. Let’s talk about how you getpaid. So with affiliate marketing, you get paid when people buy stuff andtypically you get paid a strict percentage of revenue, um, of the, ofthe gross revenue, the gross value of the sale or what they call the cartvalue. That’s a term you’ll hear a lot in affiliate marketing basically means,you know, the checkout cart, right? Like how much money was spent. And there’svariations on that where sometimes you might get, let’s say it’s a recurringsubscription, you might get paid every month, maybe you, you might get paid onall purchases that happen within let’s say seven days.Like if somebody comesback to the website, um, you might get paid if there’s a backend process withlike upsells, you could get paid a percentage of those. Sometimes it’s asmaller percentage, there’s a lot of nuances to it. But basically you’regetting paid when sales happen. Now this term CPA marketing that again, you mayhave heard and if not, let me tell you that if you get into affiliatemarketing, you will hear this term a lot. It generally stands for cost peraction. Now there’s sometimes you’ll, you’ll hear it used to mean cost peracquisition, but that’s usually when it’s used as a data point or a statisticin reference to affiliate marketing or really any kind of marketing online.They’ll say, well, what’s your CPA? What’s your cost to acquire a customer?But in terms of the type of marketing thatI’m talking about, usually CPA refers to cost per action and an action can bealmost anything that happens online.It can literally, you can get paidsometimes just for having somebody view a piece of content, like maybe watch avideo or even read a post. When people click a link. When people install a,like a free trial of an app, when people fill out a survey or any other kind ofform, you can get paid for people to put their phone number in. So in a way youcould argue that traditional affiliate marketing is actually a type of CPAmarketing where the action is an actual purchase.I guess that would technicallybe accurate though in uh, in the actual use, they kind of, you’ll hear the termaffiliate marketing, they’ll go, Oh well that’s a CPA offer and that usually whatthat means is you get paid on other actions beyond just sales. You can evenget paid in, in a CPA world for what they call CPM, which is just the costper M stands for like a thousand, which is weird cause it goes to the Latin ofMila.Like think of like a millisecond is like, or a millennium is a thousandyears, right? So cost per mille is actually for a thousand impressions. Youcan even get paid just for people to like scroll past content. But if ithappens a thousand times, you get paid, right? So many different actions thatyou can get paid for in CPA as opposed to just the purchase, which is whattraditional affiliate marketing is based around. Here’s the thing about CPA and,and you know, you, you might ask, well, why would a business pay for somethingthat doesn’t actually involve collecting money? The main reason that CPAmarketing emerged is because businesses realized if they only pay when actualsales happen, they restrict or they reduce the number of prospectiveaffiliates to only those people who can predictably and consistently generatesales.So let’s say you have somebody who has a blog and that blog gets only500 visitors a month. And of those 500 visitors, let’s say 10% are likely toview a certain page. And so that’s 50 people a month. And on that page, let’ssay there’s a, a certain, you know, place where they want people to click alink and clicking that link, they think maybe they can get, you know, 10%conversion on the page. So that would be five people a month clicking this link.So let’s say then that you’re pointing that link to a page, to a sales pagethat converts at 20% well that means that for every five people you send tothat page, you’re liable to make one sale. But if you only have five people amonth going to that page, you might go a couple months without any sales, right?You go two or three months without a sale.So whatthat’s going to do is that’s going to discourage that person who has a smallerblog from even incorporating that offer because they’ll say, I might, theremight be months, I don’t make any money. I’d rather, you know, maybe try to findsomething that converts higher. But for the, the person who put the offertogether, the product or service, they’re going, well, we don’t want tolose that person because we still want those five people a month. Because weknow that for every five people we get to our offer and we generally make onesale. Now, it might not be those five people from that one person’s website,but in general, every five people that come to our, our site, we make a sale.So we just want as many people as possible. So what can we do to enticethat person who had kind of a smaller blog that doesn’t get a ton of trafficand wasn’t willing to put all of their chips into the basket of hopefullymaking one sale per month? What can we do to entice that person to stillincorporate our offer onto their page? Well, what if we take on average what wewould have been paying out for per sale or per lead, right? Like so let’s saythe offer pays $50 per sale and they know that for every five people thatcome to the page, they tend to get one sale.So they go, well, we’repaying $50 per sale, but if we make one sale for every five people, we’reactually also kind of just paying out $10 for every person that comes to thesite, right? What if they go back to that blog owner and they say, Hey,instead of only paying you when a sale happens, what if we just pay you onefifth out amount of money every time you get somebody to our page? Because evenif you know you don’t make a sale every month, we know that over the course of ayear, over the course of a decade adjusted for enough time, the numbersare going to tend to work out where we make, we still make the same money.Right, but it makes it more enticing for the person with the smaller blog to go,well, there’s more security for me and getting paid a smaller amount every timesomebody clicks the link, then only getting paid a larger amount if one ofthose people actually buys the product.Hopefully that makes sense. It was akind of a longer explanation, but that’s really why CPA marketing emerged in thefirst place is it was just other ways of carving up the same amount of money andspreading it across more frequent actions so that you lower the thresholdsof of the publisher. That’s what they call the person who has the blog, whoputs out the content and hosts the link. What the publishersrequired to do in order to know that they’re going to make some money.Thatis why you have literally things as simple as like I said, clicking a linkor filling out a form or even just viewing an ad. Um, so that said, let’stalk about the specific types of uh, what they call assets or collateral orcreatives that a CPA publisher or I’m sorry, a CPA network, which we’ll talk alittle bit about what the network means, but what does a CPA network going toprovide you as a publisher so that you can actually get these actions to happenon your website? Okay, so first of all, a CPA, the probably the most common typeof creative that a CPA offer is going to provide you is what’s called a bannerad.Now you’ve probably seen banner ads all over the internet. They are, well,they’re exactly what they sound like. They’re little, they look like bannersand you click on them and they present the offer. So typically you sign up forone of these offers or you decide you want to promote one of these offers andthey’re going to give you a, what they call banner creatives.And theytypically come in different sizes. And you can put them on your, on your blogor your site or whatever. The next thing that they’re going to give you are goingto be called native ads. And native ads are basically ads thatare designed to fit in with and look like more content. So if you’ve everbeen on like a new site and then you’re scrolling and maybe down underneath themain piece of news, they’re like other little summaries of other news articlesand one of them might say something like sponsored article, but otherwise it justlooks like another news article. So that would be what’s considered a native adwhere it’s designed to look native to the platform as opposed to a banner ad,which is designed to kind of stand out from the platform and get your eye, drawyour eyes to it. Native ads are designed for you to, to consume or for the usersto consume as part of how they interact with the normal site.Um, and then youhave some different types of pages that they often will provide you. And you’veprobably experienced all this stuff online and maybe didn’t really know whatwas happening or know that there was a language for it. Um, but sometimesyou’ll have interstitial pages where on a link in your content that says, Oh, gohere to check this out. There’s essentially a, a link to an intermediatepage and you can actually put interstitial pages between two pages onyour, on your own content. So let’s say you have a blog post that’s like my, uh,my trip to Argentina, right? And then in that blog post you have a link that says, click here toview the hotel at my review of the hotel that I stayed at. And you have anotherblog post on your site that’s a review of that actual hotel, right? Well, youcan install an interstitial page. When they click the first link, it goes to anintermediate page or an interstitial page.And then that page maybe forcesyou to watch something, forces you to fill out a form, forces you to take asurvey, forces you to click a box to answer a question or maybe just it justpops up for two seconds and then it redirects to the ultimate destinationpage, which was the review of the hotel. But what’s cool about these pages arethe reason that they function for this purposes, it’s not static content. Sowith interstitial pages, they’re actually served up by ad servers, whichmeans the content can change every single time.So essentially what you’redoing is installing a dynamic page into your own ecosystem that functions toserve up ads off of an exchange where people are bidding. Essentially there’san auction system and you’re just participating in this dynamic ecosystem.Basically you’re turning your platform into a dynamic ad server and gettingpaid basically every time somebody views a link, so or or you know, completeswhatever the action is on the interstitial page. So that’s a kind of atechnical but super cool thing that you get. Then a lot of times you’ll have what arecalled popups or pop unders popups you’re probably familiar with. It’swhere you do something on a page and something pops up and you’re, you’reasked to take a certain action. Or usually there’s an option just to closeout the popup. And then sometimes there are what are called pop unders, whichare kind of weird because they’re like a, it’s like residue.So you go to awebsite and you do your thing and you’re hanging out and you’re reading thecontent, you’re taking the actions or doing whatever. And then you go to closethe browser and you find out that there’s actually another tab openunderneath. So what happened was you did something on the page that caused thatto pop under, behind your browser window. And so that it’s waiting foryou. Um, and pop owners are actually pretty common as well. So CPA networkshave all these, or CPA offers have all these really cool tools and affiliateoffers have, you know, some of these things as well. But it’s not nearly sovaried with affiliate offers because ultimately affiliate offers, they’rejust trying to get people to a checkout page to actually make a purchase. Andthat’s your goal as an affiliate marketer because that’s the only way youget paid.And so checkouts have to happen on secure web pages that arehosted on main website. So it’s very, it’s a lot less likely that you’re going to have this kind of,you know, creative dancing around ecosystem to actually make full onsales. Because sales typically require a certain process and a certain type ofenvironment for them to happen where the customer reads a certain type ofcontent, watches a certain type of video, gets sold on a, on a certainproduct, goes to another page, fills out a secure checkout form.They just haveto feel differently. It’s very different from, from CPA offer. Uh, and thenprobably the final thing that you get with CPA offers, um, fairly common iswhat’s called content locking. So content locking is where maybe you go towatch a video or you go to, uh, where it says like, read more. You’ll have alittle snippet or synopsis and it’ll say read more and you go to expand anarticle. And when you go to do that, it actually locks the content and forcesyou to complete another action to unlock the content, which might be answering asurvey question. Um, even just maybe watching another video first is infinitevariety of the things that you can do. Um, so that’s all the kind of creativestuff with CPA. Now as a marketer, you say, well, should I do CPA or should Ido, um, should I do affiliate marketing? So the first consideration is basicallywhat I alluded to, which is how much volume of traffic.If you have a lot oftraffic, um, it’s probably less of a concern. Butif you don’t have as much traffic, CPA’s probably a better way to go because eventhough, like I said, it gets you paid smaller amounts that gets you paid withgreater frequency and a lot of times it also gets you paid faster. Um, and thereason for that is because with affiliate marketing or with affiliateoffers, they’re not just wanting to collect the money before they pay itout. They’re wanting to make sure that the money settles, give it time for thecredit card processing to batch. Um, they’re probably making sure thatsomebody clears a certain refund window. Maybe they’re waiting to make sure thatsomebody actually engages with the product or takes delivery of the productif it’s a physically shipped product.So there can be all this stuff that has tohappen between when the transaction happens and when you actually get paidwith CPA marketing because they’re just playing off of more of, more of numberswhere it’s like, well, every, every person that walks in our door, everyperson that fills out a form, every person that clicks a link, every person,there’s certain value associated with that. They don’t have to necessarilywait for a to happen, which means a lot of times the payouts can happen a lotfaster. There’s actually CPA networks that pay every single day. Like yougenerate traffic yesterday, you get paid today with a deposit into your, your PayPal account or your Payoneer accountor even, you know, your Bitcoin wallet CPA a lot of times get people, getspeople paid faster and gets people paid with more frequency.So for you, if youhave less traffic, CPA might be the way to go. But on the flip side, affiliatemarketing can have huge perks, huge advantages to kind of draw you to it if,if you’re the right fit for it. And probably the biggest one I would say isthat with affiliate marketing, there are programs out there where you canactually hook into the entire lifetime value of the customer.And that’ssomething that is sort of intrinsically opposed to the concept of CPA a whereCPA is basically they’ve created a value for a certain action and you only getpaid on that action. Well, the affiliate marketing, you can actually be, be tiedinto the entire value of the customer. Like I said, which means not only do youget paid just when somebody buys a thing, but as I said, sometimes you getpaid if somebody comes back to the site and buys another thing up to three dayslater, seven days later or whatever. But there are some programs out there whereyou can get paid if somebody stays a customer and buys a thing a year later.Um, and those are the kind of affiliate programs that personally I really amattracted to and that I’ve used my entire career. And that obviously helped me back in 2008 2009when I was in a tight spot and I’m actually made me shameless self plug.The company that I run entre, which is an online education company, we have aone of these types of affiliate programs where you can not only get paid when youhelp us make a sale now, but you can get paid a year later if somebody comes toan event or buys a buys another course or you know, basically upgrades in anyway.So affiliate marketing. Ultimately if you, if you probably do a strictanalysis or strict comparison, affiliate marketing probably offers you more totalupside value per customer. But again, it’s, it’s a reduced, um, frequency andcertainty of getting paid in exchange for higher potential income. All that tosay, uh, let’s talk about basically a few of the CPA programs that I wouldrecommend and a few of the affiliate programs that I would recommend. Uh, ifyou’re interested in going this route, first of all, CPA offers almost alwayslive inside of what are called CPA networks. So you’re very rarely going togo to a, an individual website. Like let’s say best buy, you’re not going togo to best buy.com and have them say, well, if you’d like to get paid forevery impression of this banner, if you’d like to get paid for everydownload of this app, go to this page and sign up. Typically, if you’resigning up at a, at an individual company’swebsite, it’s an affiliate program, uh, and they run their own affiliate programand they want to pay you to help them make sales CPA offers.Typically liveinside these networks. And these are, you know, have names like CPA, lead, advendor, max bounty, pure fly Toro. There’s a whole world of these networksout there and you basically go sign up CPA networks have pretty quick approval.So a lot of times affiliate programs will take longer to approve your site.Like, let’s say, like I’ve even, I mean, I’m a pretty established affiliatemarketer. I still get rejected sometimes, uh, from, from affiliateoffers who maybe they just don’t like the type of site that I have or I’m not,they don’t consider me a perfect match for their, their industry or theircategory where I, CPA networks, they’re like pretty easy to get approved for themost part. So you put up a basic website, go apply to a CPA network.Usually they apply. Most of the good ones are, sorry, approve within 24 hoursand now you’re good.You can go grab all these offers out in their marketplaceand go promote them and start making a few bucks here and there. A typical CPApayouts are anywhere between, I mean, 50 cents per action on the low end. Uh,sometimes up to as much as like $50, but usually on something like that it’s,it’s going to be anchored more to a sale. Um, but those are, thoseare really the good networks, kind of the ones that immediately come to mind.Those are the ones that I have experience with anyways. On theaffiliate side, the affiliate side, you want to probably be, I would say moreselective and really just focus in on a few, a couple of good affiliate programsthat or, or at least stay within a tightly clustered niche becauseaffiliate marketing has a different dynamic, I would say, than CPA wheretypically affiliate marketing, you’re using it for an alternate purpose.You’re not just getting paid to generate sales, but you’re also using the paythat you get from generating sales as a w as a, I would say a, what they callsometimes a self liquidating marketing approach, meaning that the money thatyou spend to do it pays itself back in the form of at least break even revenue.But you’re actually doing it for an alternate purpose, which is to buildyour own list.So the affiliate marketing, you know the, the way I liketo approach affiliate marketing, the way I was taught to approach affiliatemarketing, which is a little different with from CPA. You ultimately want tohave people doing something before they get to the actual offer that you’regoing to get paid for. That creates something of value for you. So withaffiliate marketing, you might drive somebody to a page where they opt in to learn more about a thing, put theiremail address in and they get added to a list. Then they go to a sales page wherethey might buy something and if they buy something you get paid a commission. Iwould say the equal parts agendas there are to get paid on the, for the sale,but also to build your list. Cause over time you build this asset that you have.That’s a list of, you know, thousands or tens of thousands of people. And nowwhat do you have? You have the ability to, to promote other offers, to generatesales, to, to advertise other things completely for free because you havethis list.And so the next time you, you find a new affiliate offer that you wantto promote, you don’t have to pay or do whatever effort was required the firsttime to get people to the page. Maybe it was running ads, maybe it was optimizingcontent and ranking it and do you know whatever it was, it was either work, ittook either time, energy or money, but the next time all you have to do is justsend an email out to the list. And so the idea with affiliate marketing isthat you’re finding offers again, that are tightly clustered within certainniches or certain categories so that you can actually build lists that have afairly tight relevance to a certain subject and then you can go find otheroffers and market them to the same list.With CPA advertising,usually it’s functioning the other way around. Usually with CPA you’re puttingsomething in front of whatever it is that you’re trying to do so you’re, youknow, they’re clicking link and maybe it’s redirecting to the interstitialpage before they get to the actual content. Maybe you’re, you’re having apop up on your page that kind of interrupts and gets in front of yourpage. Maybe you’re having them complete an action, like fill out a survey oranswer a quick question before they can access the content on your page.So aCPA, a lot of times you’re putting things in front of your content that payyou money. With affiliate marketing, a lot of times you’re putting thingsbehind your content that pay you at the point of sale. So that’s kind of aconceptual dynamic difference between the two. And ultimately what I would sayis it really doesn’t matter. There’s not a right or a wrong. Personally I likeboth. If I have to choose, I’m probably going to err towards true affiliatemarketing, but that’s because at this point in my career I’ve got criticalmass.I’ve got enough content out there and I’ve got enough experience and I’vegot enough of a budget to be able to afford enough traffic that I know I canconsistently get a lot of people to content, which means in the end I’llprobably make more getting paid on the backend when people buy stuff. Butif I didn’t know all that, I would probably say at either have an equalbalance of the two or maybe air towards CPA marketing anyway. So that’s kind ofan exhaustive, an in depth explanation of CPA marketing. Probably before I wrapup, I will say there’s one other thing to know because this, you see theseterms online so much and they can be kind of confusing. So you, I, I’vetalked about CPA, right? Cost per action, but you could see CPM, you couldsee CPL, you could see CPS, you could see CPI, CPL, cost per lead, CPS costper sale, CPM, cost per mil, which is thousand impressions, CPI, cost perinstall.So like downloading apps and software. Those are all basicallyvariations on the CPA theme. But if you see somebody using those terms, at leastyou won’t be thrown off and think that it’s, you know, some, some new thing youhave to go learn about. Um, so anyways, all that to say, uh, it is just a superpowerful concept and I encourage you to explore it further and, and really, youknow, unless your life is like so cush already that you couldn’t benefit from away to make money without having to stress or work too hard, um, then it’sprobably something worth looking into. And the other thing I love about it isit actually kind of puts pressure on you and forces you to create content. Um, at apersonal level, I have found creating content to be one of the moststimulating and growth promoting things I’ve ever had to do personally. And whenyou have these affiliate offers or the CPA offers, you have to contextualizethem with content.You can’t just spam your links out there. You have to createcontent to support the business effort. And I think creating content is areally, really great thing for people to do. Kind of find things about themselvesand challenge themselves in cool ways. All that to say, check this out, and youknow, if you’ve liked this video, I’ll ask you to give me thumbs up, downbelow. If you have questions or comments or experience with CPA or affiliatemarketing, anything you want to ask me.I love answering questions. I loveengaging with my viewers, so feel free to write a question or leave a commentbelow this video and I thank you for your time. Welcome to the amazing worldof CPA and affiliate marketing. Take care..

null

You May Also Like