What is Pay Per Sale Marketing?
Affiliate marketing is an online marketing scheme that is performance-based. They use blog spots and other web pages as display area for their advertising campaign. And in return for the space, the bloggers or web owners get a profit depending on the output. It has four key players involved: the advertiser or company or merchant who owns the product that needs marketing; the publisher or affiliate who owns the website where the advertisement is displayed; the network, a neutral ground where the advertiser and the publisher can meet and do business; and the customer or visitor or buyer.
It’s like real world door to door salesman but in an internet setting. In today’s world, people are online almost 24/7. They do almost everything online – read the news, watch TV/movies, shop for clothes, learn new recipes, look for decorating ideas, even find romantic dates – you name it, you can find it on the internet. With these high demand for reading materials and topics, blogging, which used to be a hobby for celebrities, stay at home moms and DIY experts, is now a full time profession. But how do they earn their income? This is where affiliate marketing comes in. The companies saw an opportunity with these blogs. It’s like a newspaper or magazine but better – the traffic is unbelievable and you get an international audience without even stepping foot out of your room. This is marketing on steroids.
There are three types of affiliate marketing, Pay per click, Pay per lead and Pay per sale. But for this article, we will focus on the latter. Pay per sale marketing (PPS) or cost per sale marketing is a type of online marketing where the companies pay the website owner based on the number of sales directed from their website. It is different from pay per click (PPC), where the publisher gets paid based on the number of clicks the advertisement generate from their website whether or not the prospective buyer or visitor push through with the sale transaction, or from pay per lead (PPL), where the publisher gets paid on the number of leads (email addresses/telephone numbers) it generates without really closing a sale.
It’s more difficult to track sales generated by an advertisement through Pay per sale marketing but many advertisers prefer this as they only need to pay out cash for concluded sales. Advertisers used unique identifiers, which are embedded in the URL or stored in cookies, to track the movement of the visitor to ensure that all sales are rightly tagged to the right publisher. While there are some that close their sales offline or through telephone calls, a telephone number’s cookie-based rotating system can be used to accurately match the call to the online visitor. So whether that sale was done online or offline, any successful sale would be tagged to the publisher and the advertiser will pay them depending on the pricing system agreed upon by both parties.
On the publisher’s point of view, PPS model generates more income for the site. While PPC pay for every click from your followers, the payment in question is very minimal – some pay as low as $.01 per click. The former, on the other hand, pays more but requires every stars in the universe to line up. The publisher needs to have the perfect topic that can lure the right visitors that are looking to buy the products on the advertisement. There is more work in the PPS than PPC or PPL. Not only do you need online traffic that is comprised with sure buyers to generate income, you also need the advertisers to meet their end of the bargain – the company’s online store should be visually interesting and competitively priced, otherwise it will be “click to go back” before any sale transaction can take place. And by sale transaction, it means paid for and kept by the customer, because if they return the item, unfortunately, your commissions will be reversed.
On the advertiser’s point of view, basically, pay per sale marketing is God’s gift to them. Using online marketing tools can open a door to frauds but with PPS, advertisers are safe from auto-clicker and auto-typer tools and software. To generate income, the customers are required qualified actions like filling out information forms and actually paying with your credit card – the companies are assured that all transactions are legit and not fraudulent. And in case the customers change their minds about the product and decide to return the item, the advertiser can actually ask the publisher for a reversal on the agreed commission. The advertisers are in control. They only shell out money for web owners with sure buyers; they pay for result. They’re paying for marketing that gets result unlike paying for non-action clicks or worse, accidental clicks.
If pay per sale marketing is more beneficial to the advertiser than to the publisher, why is it still in existent? Why are there still bloggers and publishers signing up for this? Because whether it’s pro publisher or not, PPS gives the most commission online. Imagine getting a substantial portion of the profit without having the need to create your own store. And if you do find your niche market which belongs to the company’s target market, this type of marketing can be a gold mine – especially if you’re dealing with high end products with wider market like cell phones, cameras and computers.
For website owners who are using PPS, it is important to make your website appealing to the potential buyers. It is also important to choose the products you advertise. Like other celebrities, you hear them saying that they only advertise the products that they believe in. This should also be true with online advertising, especially celebrity bloggers who has a solid following because they are idolized and admired. Remember that refunded items mean reversal of commission on your part. For the advertisers, remember not to pay for “nothing” in the future and by nothing, we meant “Fat Finger” accidental clicks.