Information about Compensation Methods
Compensation methods (Remuneration), Pricing models and business models used for the different types of Internet marketing, including Affiliate marketing, Contextual advertising, Search engine marketing (including vertical comparison shopping search engines and local search engines) and Display advertising.
This is a new compensation model. No official abbreviation exist yet. Similar to pay per click, pay per call is a business model for ad listings in search engines and directories that allows publishers to charge local advertisers on a per-call basis for each lead (call) they generate (CPA). Advertiser pays publisher a $x.xx commission (CPA) for phone calls received from potential prospects as response to a specific publisher Ad.
The term "pay per call" is sometimes confused with "click to call". Click-to-call, along with call tracking, is a technology that enables the “pay-per-call” business model. Call-tracking technology allows to create a bridge between online and offline advertising. Click-to-call is a service which lets users click a button or link and immediately speak with a customer service representative. The call can either be carried over VoIP, or the customer may request an immediate call back by entering their phone number. One significant benefit to click-to-call providers is that it allows companies to monitor when online visitors change from the website to a phone sales channel.
Pay-per-call is not just restricted to local advertisers. Many of the pay-per-call search engines allows advertisers with a national presence to create ads with local telephone numbers. Pay-per-call advertising is still new and in its infancy, but according to the Kelsey Group, the pay-per-phone-call market is expected to reach US$3.7 billion by 2010.
Pay Per Install. Advertiser pays publisher $x.xx in commission for every install which was made by user who downloaded usually free application to which was bundled special code containing "Adware" application. Users are prompted first if they really want to download and install this software. Pay per Install is included in the definition for Pay per action (like Cost-per-acquisition), but its relationship to how AdWare like Zango and Pay-per-Install of softahead.com [3] is distributed, made the use of this term versus Pay per action more popular to distinguish it from other CPA offers that pay for software downloads. The term Pay per install is being used beyond the download of AdWare[4].
Google AdSense offers this compensation method for their "Advertise on this site" feature that allows Advertisers to target specific publisher sites within the Google content network.
A credit card is a system of payment named after the small plastic card issued to users of the system. A credit card is different from a debit card in that it does not remove money from the user's account after every transaction.
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Predominant Compensation Methods in Affiliate Marketing
The following models are also referred to as performance based pricing/compensation model, because they only pay if a visitor performs an action that is desired by the advertisers or completes a purchase. Advertisers and publishers share the risk of a visitor that does not convert.Pay-per-sale (PPS) - (Revenue Share)
Cost-per-sale (CPS). Advertiser pays the publisher a percentage (%) of the order amount (sale) that was created by a customer who was referred by the publisher. This model is by far the most common compensation model (81%) [1] used by online retailers that have an affiliate program. This form of compensation is also referred to as Revenue sharing.Pay-per-lead (PPL) / Pay-per-action (PPA)
Cost-per-action or Cost-per-acquisition (CPA), Cost-per-Lead (CPL). Advertiser (Merchant) pays publisher (Affiliate) $x.xx in commission for every visitor that was referred by the publisher to the advertiser (web site) and performs a desired action, such as filling out a form, creating an account or signing up for a newsletter. This compensation model is very popular with online services from internet service providers, , banks (loans, mortgages, credit cards) and subscription services. CPA is the second most used compensation model (19%) after CPS (81%). [1]Special CPA Compensation Models
Pay-per-call (no abbreviation exists yet)
This is a new compensation model. No official abbreviation exist yet. Similar to pay per click, pay per call is a business model for ad listings in search engines and directories that allows publishers to charge local advertisers on a per-call basis for each lead (call) they generate (CPA). Advertiser pays publisher a $x.xx commission (CPA) for phone calls received from potential prospects as response to a specific publisher Ad.
The term "pay per call" is sometimes confused with "click to call". Click-to-call, along with call tracking, is a technology that enables the “pay-per-call” business model. Call-tracking technology allows to create a bridge between online and offline advertising. Click-to-call is a service which lets users click a button or link and immediately speak with a customer service representative. The call can either be carried over VoIP, or the customer may request an immediate call back by entering their phone number. One significant benefit to click-to-call providers is that it allows companies to monitor when online visitors change from the website to a phone sales channel.
Pay-per-call is not just restricted to local advertisers. Many of the pay-per-call search engines allows advertisers with a national presence to create ads with local telephone numbers. Pay-per-call advertising is still new and in its infancy, but according to the Kelsey Group, the pay-per-phone-call market is expected to reach US$3.7 billion by 2010.
Pay-per-install (PPI)
Pay Per Install. Advertiser pays publisher $x.xx in commission for every install which was made by user who downloaded usually free application to which was bundled special code containing "Adware" application. Users are prompted first if they really want to download and install this software. Pay per Install is included in the definition for Pay per action (like Cost-per-acquisition), but its relationship to how AdWare like Zango and Pay-per-Install of softahead.com [3] is distributed, made the use of this term versus Pay per action more popular to distinguish it from other CPA offers that pay for software downloads. The term Pay per install is being used beyond the download of AdWare[4].
Pricing Models in Search Engine Marketing
Pay-per-click (PPC)
Cost-per-click (CPC). Advertiser pays publisher $x.xx amount of money, every time a visitor (potential prospect) clicks on the advertiser's Ad. It is irrelevant (for the compensation) how often an Ad is displayed. commission is only due when the Ad is clicked. See also click fraud.Pay per Action (PPA)
Cost-per-action (CPA). Search Engines started to experiment with this compensation method in spring 2007. [5]Pricing Modes in Display Advertising
Pay-per-impression (PPI)
Cost-per-mil (mil/mille/M = latin/Roman numeral for thousand) impressions. Publisher gets from Advertiser $x.xx amount of money for every 1000 impressions (page views/displays) of the Ad. The Ad can be text (AdSense), banner image or rich media.Pay per Action (PPA) or Cost per Action (CPA)
Cost-per-action (CPA). Used by display advertising as pricing mode since as early as early as 1998 [6]. By the end of 2006 did the share of the CPA/Performance pricing mode (47%) catch up with the CPM pricing mode (48%)[7] and will become the dominant pricing mode for display advertising, if the trend of the last 9 years will continue in 2007 [8].Shared CPM
Shared Cost-per-mil (CPM) is a pricing model in which two or more advertisers share the same ad space for the duration of a single impression (or page view) in order to save CPM costs. Publishers offering a shared CPM pricing model generally offer a discount to compensate for the reduced exposure received by the advertisers that opt to share online ad space in this way. Inspired by the rotating billboards of outdoor advertising, the shared CPM pricing model can be implemented with either refresh scripts (client-side JavaScript) or specialized rich media ad units[9]. Publishers that opt to offer a shared CPM pricing model with their existing ad management platforms must employ additional tracking methods to ensure accurate impression counting and separate click-through tracking for each advertiser that opts to share a particular ad space with one or more other advertisers.Compensation Methods in Contextual Advertising
Pay-per-click (PPC)
See PPC/CPC in Search Engine MarketingPay-per-impression (PPI)
see PPI/CPM in Display AdvertisingGoogle AdSense offers this compensation method for their "Advertise on this site" feature that allows Advertisers to target specific publisher sites within the Google content network.
Compensation methods grid
There are different names used for the same type of compensation method and some compensation methods are actually special cases for another method. This grid shows alternative names for the individual compensation methods. The "cost per ..." name was used as default.| Cost per xxx | Alternative Terms and sub-types | Notes |
| Cost per click (CPC) | ||
| Pay per click (PPC) | Pay per click is as much used as CPC While CPC is being used more when it comes to statistics and analytics, is PPC predominant for the use in Pay per click advertising or PPC search engine | |
| Cost per action (CPA) | ||
| Pay per action (PPA) | ||
| Special Types of CPA (Sub-Types) | ||
| Pay per lead (PPL) | ||
| Cost per lead (CPL) | e.g. Application Form filled out, Email List sign up | |
| Pay per conversion (n/a) | ||
| Cost per conversion (n/a) | ||
| Pay per acquisition (PPA) | ||
| Cost per aquisition (CPA) | Create own paragraph. New Customer, Email List sign up | |
| Pay per call (n/a) | Special type of CPA that requires different tracking than traditional CPA tracking (such as unique phone numbers) | |
| Cost per call (n/a) | ||
| Pay per download (n/a) | create own paragraph. | |
| Cost per download (n/a) | ||
| Pay per install (PPI) | Only used if referred to AdWare Dowloads | |
| Cost per install | ||
| Cost per sale (CPS) | ||
| Pay per sale (PPS) | ||
| Commission per sale (n/a) | ||
| Revenue share | General term for paying a percentage of the earned revenue as commission to the parter | |
| Cost per mill (CPM) | ||
| Pay per mill (PPM) | ||
| Cost per impression (CPI) | ||
| Pay per impression (PPI) | ||
| Cost per thousand (CPT) | M in CPM stands for Mill, which is the Roman numeral for Thousand | |
| Pay per thousand (PPT) | ||
References
1. ^ AffStat Report 2007. Based on survey responses from almost 200 affiliate managers from a cross-section of the industry
2. ^ AffStat Report 2007. Based on survey responses from almost 200 affiliate managers from a cross-section of the industry
3. ^ Pay Per Install of www.softahead.com, the best software marketing solution with affiliate program and targeted distribution
4. ^ Google Results for "Pay-per-install" showing references to the term
5. ^ Pay-per-action beta test introduction, posted on 3/20/2007 at Google's Inside AdWords Blog, Google Pay-Per-Action (beta)
6. ^ Internet Advertising Revenue more than double in 1998, New York, NY - May 3, 1999, IAB - Interactive Advertising Bureau
7. ^ IAB/PwC Release First Half 2006 Internet Ad Revenue Figures NEW YORK, NY , September 25, 2006, IAB - Interactive Advertising Bureau
8. ^ IAB/PwC Ad Revenue Reports, industry stats and figures since 1996, IAB - Interactive Advertising Bureau
9. ^ Tristitial shared rich media ad unit
2. ^ AffStat Report 2007. Based on survey responses from almost 200 affiliate managers from a cross-section of the industry
3. ^ Pay Per Install of www.softahead.com, the best software marketing solution with affiliate program and targeted distribution
4. ^ Google Results for "Pay-per-install" showing references to the term
5. ^ Pay-per-action beta test introduction, posted on 3/20/2007 at Google's Inside AdWords Blog, Google Pay-Per-Action (beta)
6. ^ Internet Advertising Revenue more than double in 1998, New York, NY - May 3, 1999, IAB - Interactive Advertising Bureau
7. ^ IAB/PwC Release First Half 2006 Internet Ad Revenue Figures NEW YORK, NY , September 25, 2006, IAB - Interactive Advertising Bureau
8. ^ IAB/PwC Ad Revenue Reports, industry stats and figures since 1996, IAB - Interactive Advertising Bureau
9. ^ Tristitial shared rich media ad unit
Remuneration is pay or salary, typically monetary payment for services rendered, as in an employment.
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See also
Remuneration can include:- Commission
- Compensation methods (in online advertising and internet marketing)
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Pricing is one of the four p's of the marketing mix. The other three aspects are product management, promotion, and place. It is also a key variable in microeconomic price allocation theory.
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Internet marketing, also referred to as online marketing or Emarketing, is marketing that uses the Internet. The Internet has brought many unique benefits to marketing including low costs in distributing information and media to a global audience.
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Affiliate marketing is a method of promoting web businesses (merchants/advertisers) in which an affiliate (publisher) is rewarded for every visitor, subscriber, customer, and/or sale provided through his/her efforts.
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Contextual advertising is the term applied to advertisements appearing on websites or other media, such as content displayed in mobile phones, where the advertisements are selected and served by automated systems based on the content displayed by the user.
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Search Engine Marketing, or SEM, is a form of Internet Marketing that seeks to promote websites by increasing their visibility in the Search Engine result pages (SERPs).
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Display advertising is a type of advertising that may, and most frequently does, contain graphic information beyond text such as logos, photographs or other pictures, location maps, and similar items.
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Revenue sharing is the splitting of operating profits and losses between the general partner(s) and limited partners in a limited partnership. More generally, the practice of sharing operating profits with a company's employees, or of sharing the revenues resulting between
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Cost Per Action or CPA (as it is often initialized to) is a phrase often used in online advertising and online marketing circles.
CPA is considered the optimal form of buying online advertising from a direct response advertiser's point of view.
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CPA is considered the optimal form of buying online advertising from a direct response advertiser's point of view.
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Pay per lead (PPL) is a method of marketing that enables an advertiser to receive membership or advertising services in return for paying per lead received from the marketing venue used.
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Merchants function as professionals who deal with trade, dealing in commodities that they do not produce themselves, in order to produce profit.
Merchants can be of two types:
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Merchants can be of two types:
- A wholesale merchant operates in the chain between producer and retail merchant.
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An affiliate is a commercial entity with a relationship with a peer or a larger entity.
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Broadcast networks
In a radio network or Television network, an affiliate is a radio station or TV station that agrees to carry the broadcasts of, but is not owned by, the network...... Click the link for more information.
Internet service provider (abbr. ISP, also called Internet access provider or IAP) is a business or organization that provides consumers or businesses access to the Internet and related services. In the past, most ISPs were run by the phone companies.
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A loan is a type of debt. All material things can be lent but this article focuses exclusively on monetary loans. Like all debt instruments, a loan entails the redistribution of financial assets over time, between the and the .
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Property law
Part of the common law series
Acquisition of property
Gift · Adverse possession · Deed
Lost, mislaid, and abandoned property
Alienation · Bailment · License
Estates in land
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Part of the common law series
Acquisition of property
Gift · Adverse possession · Deed
Lost, mislaid, and abandoned property
Alienation · Bailment · License
Estates in land
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A credit card is a system of payment named after the small plastic card issued to users of the system. A credit card is different from a debit card in that it does not remove money from the user's account after every transaction.
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The subscription business model is a business model that was pioneered by magazines and newspapers, but is now used by many businesses and websites. Rather than selling products individually, a subscription sells periodic (monthly or yearly or seasonal) use or access to a product
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Advertising is paid, one-way communication through a medium in which the sponsor is identified and the message is controlled by the sponsor. Variations include publicity, public relations, etc..
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Electronic publishing includes the digital publication of ebooks and electronic articles, and the development of digital libraries and catalogues. Electronic publishing has become common in scientific publishing where it has been argued that peer-reviewed paper scientific journals
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Click-To-Call or CTC refers to a process of converting web based traffic into direct telephony communication between an end user and some other entity. CTC processes vary depending upon platforms, but there are two general styles of CTC: using the computer to complete the call
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Adware or advertising-supported software is any software package which automatically plays, displays, or downloads advertising material to a computer after the software is installed on it or while the application is being used.
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Adware or advertising-supported software is any software package which automatically plays, displays, or downloads advertising material to a computer after the software is installed on it or while the application is being used.
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180solutions, Inc.
Zango
Private
Founded 1999
Headquarters Bellevue, Washington
Key people Keith Smith, Co-founder, Chief Executive Officer
Jamie Miller, Chief Financial Officer, Chief Financial Officer
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Zango
Private
Founded 1999
Headquarters Bellevue, Washington
Key people Keith Smith, Co-founder, Chief Executive Officer
Jamie Miller, Chief Financial Officer, Chief Financial Officer
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Pay per click (PPC) is an advertising model used on search engines, advertising networks, and content websites/blogs, where advertisers only pay when a user actually clicks on an ad to visit the advertiser's website.
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Pay may refer to:
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- A wage or salary earned for work
- The process of payment for goods and services, an aspect of trade
- Waterproofing the seams of a wooden ship
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The payment of commission as remuneration for services rendered or products sold is a common way to reward sales people. Payments often will be calculated on the basis of a percentage of the goods sold.
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Click fraud is a type of internet crime that occurs in pay per click online advertising when a person, automated script, or computer program imitates a legitimate user of a web browser clicking on an ad, for the purpose of generating a charge per click without having actual
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Cost Per Impression is a phrase often used in online advertising and marketing related to web traffic. It is used for measuring the worth and cost of a specific e-marketing campaign.
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Roman numerals is a numeral system originating in ancient Rome, adapted from Etruscan numerals. The system used in classical antiquity was slightly modified in the Middle Ages to produce the system we use today. It is based on certain letters which are given values as numerals.
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Advertising is paid, one-way communication through a medium in which the sponsor is identified and the message is controlled by the sponsor. Variations include publicity, public relations, etc..
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