When you’re engaging in affiliate marketing it’s important to understand the difference between a revenue sharing affiliate network and a cost-per-acquisition (cost-per-action) network. The benefits of using an affiliate network is that they have hundreds to thousands of affiliates (publishers) ready and able to promote their advertiser’s offers. The affiliate network makes their compensation in the form of a small percentage, usually 1% - 5% of each transaction placed through their network.

Revenue share affiliate networks are most often for E-commerce websites and offer merchants the opportunity to advertise their store and products on the network. Depending on the industry and at the discretion of the advertiser, a total 10-30% of the sale is usually offered as the commission to the affiliate. Some major affiliate networks you may have heard of are Commission Junction, LinkShare and ShareASale.

CPA networks on the other hand, offer each of their affiliates (publishers) a set amount for each sale, subscription or lead that affiliate generates. CPA networks tend to negotiate much more aggressively and require higher payouts. Some of the most popular CPA networks are Affiliate.com, Hydra and MarketLeverage. If you are publishing your offer on a CPA network, make sure to inform them as to whether or not you are comfortable with “incentivized traffic”. “Incentivized traffic” is a tactic used by publishers to boost their sales or signups and therefore their commissions. However, with “incentivized traffic” publishers will often offer free items with the terms that their viewers sign up for other offers in order to claim them. In that case, the new customer, prospect or subscriber they generate for the advertiser is often of lower quality.

When managed correctly, both revenue sharing and CPA affiliate marketing increases revenue, exposure and performance of thousands of businesses online each year.