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Affiliate marketing terms: what are EPC and CR?

Affiliate marketing terms: what are EPC and CR?

What is EPC and why is it important for affiliate marketing?

EPC stands for Earn Per Click and means the amount of money you can get by investing in traffic. For example, if EPC is 2 rubles, then on average it will be the income from one visitor. In other words, this is earnings per 100 clicks.

In affiliate marketing, the value is determined between all parties to the transaction. This means that the cost is actually an average. One person may have a higher value and another person may have a lower value. For example, if 9 webmasters receive 2 rubles each and one receives 38 rubles, the average value will be 4 rubles.

Where should a beginner start?

The expression EPC stands for the average amount of money received from 100 clicks. This number is calculated by dividing the income received from offers or advertisers by the number of clicks. Thus, the higher this indicator, the more profit a webmaster gets from one click.

Beginners, as a rule, do not take into account that EPC shows only income and does not take into account expenses. The arbitrator must calculate the affiliate income on his own. Here we will give more detailed information on this issue.

How to increase the EPC rate?

You can make sure that an advertising campaign is created correctly by running tests using the offer you found to generate revenue. Here's how it can be done.

  • Choose creatives that are profitable and maximize clickability.
  • We create ourselves or choose a suitable landing page.
  • We turn off all sources and sites, regions and cities with unprofitable transitions.
  • For contextual advertising disable unprofitable words and ads.

For proper optimization do the following.

  • For teaser ads, optimize tracking and pass conversion information to the tracker.
  • Define metrics for social media-based contextual and marketing campaigns. The data is fed into the system, thus forming areas suitable for commercialization and providing the user with the necessary information about launch times.
  • It is important to understand that even if the landing page is poorly designed, creative ad optimization will not be enough to increase the webmasters profits. It follows that in addition to optimization, attention should be paid to the development and improvement of the landing page.

The question arises, how to make optimization in advertising without errors? An analytical model in affiliate marketing will help answer it. Evaluate the data on visits for different time intervals. Pay attention to the value. For example, if the indicators for a week are higher compared to a three-day period, this confirms that the optimization was done correctly. If, on the other hand, the EPC value is falling, then you made a mistake in its setting.

How to use EPC when working with traffic?

If you have partners with offers that seem profitable, don't spend too much budget on testing them. Choose the most profitable options and only then start promoting. If you plan to buy 5 thousand clicks, start with 200-500 to test them.

If the value is less than average, you should think about how to optimize or change the landing page. If, on the other hand, the data is close to or exceeds the average EPC value, then you've done everything right.

How is EPC calculated in advertising?

To explain the concept of EPC, let's look at an example of an webmasters. He was able to generate 1000 clicks on a given offer and as a result he received 5 sales, each of which brought him 500 ₽ commission. This resulted in a total profit of 2,500 rubles. EPC is calculated by dividing this profit (2500) by the number of clicks (1000), which gives an EPC value of 2.5.

Substituting the obtained figures into the equation, we can conclude that the EPC is equal to 2.5. Despite the fact that this is an excellent criterion for choosing a partner, we should not forget that this is not the final result. It symbolizes the average income of a webmaster that can be estimated. To find out this information, go to the main page of any affiliate network, and it will be shown there, and in some cases for individual GEOs.

The resulting value indicates the proportion of targeted actions in relation to the total number of individuals. A higher figure than you achieved in the affiliate network means that you made mistakes when setting up your ads. The webmasters should strive to make this figure equivalent or even better. The higher the conversion rate in the affiliate network, the more income you can get from affiliate marketing. In order not to spend the entire budget allocated for advertising, you should conduct testing and see how many people bought this or that offer, and then calculate the EPC value.

EPC rate 

Uniform or average values cannot be applied to all offers. In some categories, EPC can be 150 rubles, while in others it may not even reach 5 rubles. In the end, everything depends on how much you spent on advertising and what kind of income you received.

In an affiliate network, it is important to understand what will be considered the usual value and what will be considered unusual.

Once your marketing campaign has been launched and visitors start flowing in, your EPC should be higher than your cost per click. For example, if you get 1500 clicks and profit, it means that the metric is positive for you. If its value is below the cost per click, however, it means you are losing money.

To illustrate the work of affiliate marketing and affiliate network, let's consider an example. Let's say you buy clicks in a teaser network for 1 ruble per click. Having invested in the affiliate network 3 thousand rubles, you get orders for 6 thousand rubles. This gives us a cost of 2 rubles for each of your expenses, which leads to a profit of 3 thousand rubles. However, if the cost is only 0.7 or 0.8 rubles, then you do not make a profit, but incur losses. For example, if you earned 25 thousand rubles on transitions for webmasters, but lost 10 thousand rubles, it means that overall you still made a profit despite the losses incurred.

What is CR in affiliate marketing?

Conversion rate, or conversion rate, is the number or proportion of visitors who take a predetermined action. For example, they may have registered, filled out a form, or made a purchase. For example, out of 1,000 clicks on an Internet site, 10 people took the desired action. This means that CR in traffic exchange is equal to 1%.

Here is the formula to calculate it: The number of people who performed the desired action, divide by the total number, and then multiply by 100%. To illustrate this, we ran an example.

CR in affiliate marketing is used to illustrate the real return on investment and allows you to determine the amount earned.

Basic CPA Terms

  • In CPA payments (Cost Per Action), an affiliate is rewarded for each action taken by a customer. This method involves not just attracting customers, but pushing them to a certain action. Examples of such actions include filling out surveys, signing up for a card, or purchasing a product; in exchange, the affiliates receives a predetermined revenue share.
  • The individuals who followed the affiliates advice and clicked on the ad are called traffic.
  • The marketer pays the webmasters a fee for attracting potential customers.
  • An offer from the affiliate is provided. It describes in detail the rules and the product itself, which the marketer must advertise.

CPA Features

If you want to make more money after learning CPA terms, start exploring. Experiment with advertising campaigns, but make sure you don't use up all your resources at once. Even after deciding on a certain specialization, don't forget that it can vary. Much depends on the product you sell and the traffic you attract. If you see a high earning potential on one product, you may be able to spend more money on another product with similar parameters.

If you want to maximize affiliate marketing profits, choose an affiliate program that constantly provides a lot of offers. To avoid quickly exhausting your budget, first try to attract customers for free through your website or social media. After that, evaluate the effectiveness of sales with the help of teaser and contextual advertising.

To summarize

In order for a novice webmasters to make an informed choice between offers, it is necessary to have a good understanding of the terms used. We have reviewed the most important ones and explained them in an easy-to-understand way. So, now you know that if the EPC in an ad is lower than usual, it means that the ad is set up incorrectly. It needs to be fixed or redesigned.

We have done a brief overview of what CR is in affiliate marketing and what is its impact. Our study shows the proportion of users who took the desired action. From the article, we learned that if your partners offer favorable offers and you want to save money on tests, choose the most favorable offers.

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