| CPA networks, or affiliate marketing operations based | | | | figures a year online, most couldn't even secure a |
| on a Cost-Per-Action model, have been around for | | | | junior-level position in corporate marketing departments |
| years, even though they're seldom discussed in the | | | | - especially not on an international scale. |
| Internet Marketing arena, and just slightly more often in | | | | As a result, online marketers look at what they make |
| the affiliate marketing realm. Cost per action, also | | | | on each sale and offer a piece of that to their |
| sometimes called cost per acquisition, is like most other | | | | affiliates. Affiliate marketers look at the product, the |
| affiliate marketing programs in that you make money | | | | conversion rate of the salespage, and the percentage |
| from actions taken by targeted traffic your refer to | | | | offered as affiliate commissions. Everything is based |
| the merchant's site - but that's where the similarity | | | | on the current sale in most cases. The closest most |
| usually ends. | | | | come to a CPA model is offering 100% commissions, |
| In regular affiliate programs, the money you earn is a | | | | meaning that really they're giving away the sale to get |
| percentage of each sale you make. With CPA offers, | | | | the lead. But again, even 100% commissions are based |
| usually you're earning your affiliate commissions based | | | | solely on the current sale. |
| not on sales but on other actions the merchant wants | | | | High-level offline marketing, however, is based on the |
| to effect. It can be downloading a free report, asking | | | | lifetime value of each customer and factors in the ratio |
| for a free sample, having free information mailed out to | | | | of leads to sales, the average retention rate and |
| you, getting access to a private members' area of a | | | | longevity of client contracts, and the total dollars |
| website, etc. | | | | earned from the 'average' customer or client. While this |
| As you can see from the above examples, | | | | involves a lot of research and number-crunching |
| cost-per-action or cost-per-acquisition is usually | | | | Internet marketers are loath to even attempt, it allows |
| modeled so that you're getting paid for free actions | | | | lead acquisition programs to blow online marketers out |
| taken by the traffic you refer. So if you're firmly | | | | of the water in terms of payouts. |
| planted in the affiliate marketing mindset, alarm bells | | | | Newer affiliates try to sign up in droves, often spurred |
| are probably going off in your head right now... After all, | | | | on by e-books about CPA programs that tout the high |
| what kind of shady operation is promising to pay you | | | | earning possible from a pay-per-lead program. They |
| commissions when you haven't made any sales? As if | | | | don't realize that corporations are very protective both |
| they had the money to just give away like that... Yeah, | | | | of their brand's image and of the quality of leads they |
| right! | | | | receive - remember that the conversion ratio is one of |
| If that's what you're thinking, here's a real surprise for | | | | the main factors in determining what they pay per lead. |
| you: almost without exception, these cost per action | | | | This results in as many as 90% of all applications to |
| arrangements are set up by, or on behalf of, some of | | | | CPA networks being rejected, dashing the affiliate's |
| the biggest offline companies in the world, including | | | | hopes for big CPA earnings. |
| insurance companies, travel companies, offshoots of | | | | In truth, without an existing track record in CPA, or |
| international banking consortiums, etc. These very large, | | | | very professionally-designed websites heavy in |
| very dependable corporations use cost per acquisition | | | | marketing psychology, most marketers will never get |
| models to get leads from targeted prospects, leads | | | | into the CPA networks and have a chance at earning |
| they obviously hope to convert to ongoing clients. Their | | | | money with cost per action opportunities. New CPA |
| lead acquisition programs are tested, tweaked, and | | | | networks are coming online though that raise the bar |
| tested again, and are some of the most closely | | | | for average marketers, providing both cost per |
| monitored results of any online activities anywhere. | | | | acquisition offers and pre-designed websites shown to |
| It's very important to remember that marketing is much | | | | drive the right quality of traffic to the merchants' sites |
| more mature and professional in the offline world than | | | | and opt-in forms. These should finally open the cost |
| in most of the online world. Look at the highly-varied | | | | per action field up to a great many more online |
| background of today's Internet marketers and affiliate | | | | marketers, finally making it a viable way for affiliate |
| marketers - surprisingly few have a solid marketing | | | | marketing businesses to make money online using the |
| background or any formal marketing education at the | | | | CPA model. |
| post-secondary level. While many are earning 6, 7 or 8 | | | | |