CPA Marketing For Beginners In 2022: Step-by-Step Guide

Affiliate marketing is one of the working business models for making money online. It’s a good way to monetize web traffic or your customer acquisition skills. Depending on the results and the time you’re willing to invest in it, it can be a source of additional income or even a full basic income.

There are many myths and controversies surrounding this topic. Some say that anyone can easily earn passive income, while others say that you have to work around the clock to get results at the start. In this article, we’ll explore what CPA marketing means, how it works, and how you can get started as a CPA marketer. 

What is CPA marketing?

CPA stands for Cost Per Action, or sometimes, Cost Per Acquisition marketing. The model is based on the principle of mediation. On one side is an advertiser who wants to promote his products or services, on the other side there are people who need these products and services. Your task is to bring them together to get an affiliate commission from an advertiser for every targeted action taken. The logic is simple, but in practice you have to take into account a lot of details.

Step by step, the process looks like this:

The seller creates an affiliate program that spells out the terms, traffic requirements, desired targeted actions and other technical aspects. Affiliate programs can be found on companies’ official websites or in affiliate networks.

In case of working with affiliate networks the process is simple: a webmaster or an arbitrage specialist finds the offer in the catalog. If his traffic sources pass the criteria, he gets a unique affiliate link. This link is used in promotion – an affiliate can put it on his website, social media page or use it in any other allowed traffic source.

When a potential client clicks on the link, the information about the source is getting recorded into cookies. If during cookies lifetime (specified in the conditions), the visitor proceeds with completing a targeted action – you get a commission.

The effectiveness of the model is confirmed by data. According to Statista the affiliate market is rapidly growing – every year companies spend more and more money on this type of promotion:

CPA Marketing Terminologies

In the beginning webmasters and arbitrage specialists face dozens of new terms. To work effectively, you need to understand the main concepts that influence your decision when choosing an affiliate program.

Affiliate Program (also called “affiliate offer” or “CPA program/CPA offer”) 

It’s an advertising offer which defines the terms, commissions, requirements and technical parameters.

Advertiser

It’s a company or brand which creates an affiliate program. Their task is to list all the requirements to present the necessary information on the promotion, to provide the data on the targeted actions and to make payments to affiliates.

Affiliate (also called “publisher” or “webmaster”)

This term in affiliate marketing means the webmasters and arbitrage specialists who promote the offer. 

Affiliate Network (also called “CPA Network”)

This is a platform which connects advertisers with affiliates. Advertisers place their affiliate offers and affiliates can find the most suitable programs by using filters. Indoleads is a premium affiliate network where you can easily connect to more than 2000 CPA offers from companies in 180+countries of the world.

Targeted action

Each product or service has its own criteria for evaluating commercial effectiveness. When promoting services, it’s necessary to get as many leads as possible, for products – sales, for apps and games – installations, and for services – registrations. All of them are targeted actions, which are specified in the conditions of the affiliate program.

Hold period

This is a period of payment withholding, during which the target actions are checked. Usually the period depends on the complexity of the check and the possibility of return. For example, in applications and online services, everything is automatized, so once a user has paid, the data is loaded into the system. In case of physical goods, it’s more complicated and longer, so time is put in the hold for delivery and the possibility of returns.

Confirmation Rate 

Another technical term that shows how many targeted actions are accepted by an advertiser. The higher this rate, the better the offer is for an affiliate. The actions are rejected due to the affiliate’s failure to meet the conditions spelled out in the offer. For example, if the goal is to attract people from Brazil but the payment was made from the US, the advertiser has the right not to pay the commission for the sale.

Cookie lifetime

This parameter shows how long information about the traffic source will be stored in the system. For example, if the period is 30 days and your lead makes a payment on the 31st day, you will not receive a commission for that transaction.

Conversion rate (CR)

Conversion rate helps to understand the exact percentage of users who take the targeted action on the advertiser’s site. The higher it is, the easier it is to make money from that offer.

eCPC

This concept is used to refer to the effective price per click. The index is tied to conversions and the cost of the targeted action. With its help, you can calculate how profitable it is to promote a product or a service.

Why it’s more profitable to work with CPA Networks

Webmasters and arbitrage specialists can work with companies directly. However, when working with multiple advertisers, it’s too difficult to manage them.

Advantages of CPA networks:

• Effortless search 

All offers are collected in one catalog and sorted by important parameters for affiliates. This saves time an affiliate usually spends on searching for and connecting to programs. The cards with affiliate programs are arranged in a simple way, so they are easier to compare. Affiliates’ feedback is used as a basis for rating – this also helps to make a choice and monetize traffic more effectively.

• Support service 

If you encounter any issue, be it a technical question or a question related to promotion and choosing the most suitable programs, you can instantly write in the chat or give a call. Managers can help you to fix technical issues, negotiate higher payouts and get exclusive offers.

• Simplified earnings withdrawal 

When working with several offers it’s easier to accumulate the minimum amount of payments than when working with different companies. The registration on the platform is free, but the network takes a commission for payments. This amount is recouped through time-saving and automation of processes.

How is the payment system arranged?

Two indicators affect earnings in affiliate marketing  – conversion and payment model. Unlike other advertising channels, advertisers pay for specific actions, so the conversion rate (CR) is the main thing to focus on.

Targeted actions

CR is primarily influenced by the complexity of the action a user needs to perform. There are three types of targeted actions:

Single action (SOI, Single Opt-In) 

A user is required to do one thing: fill out a form with an email or phone number, submit an application, register for a service, etc. Payouts here are the lowest and conversions are high. This way of monetization is suitable if you have a big audience.

Double Opt-In (DOI, Double Opt-In)

This principle involves two interrelated steps, such as registration and confirmation, filling out a form and answering the call from a manager, etc. 

Complex, multi-step conversions

This approach is often used in games. For example, a person must download the game, authorize and pass it to a certain level. Although CR is lower here, these offers usually pay much more.

Payment models

The second criterion which impacts your earnings from affiliate marketing is the payment model. The common name of the group is CPA affiliate programs (cost per action), but for convenience in catalog categories they are clarified by specific actions:

CPS (cost per sale): programs with the highest payouts, where the goal is to drive sales of products, services or subscriptions.

Rev Share (revenue share): if in CPS you get money per sale, in this model you will get commissions from every transaction from the client.

CPI (cost per install): an affiliate gets paid for every new user who installs an app or a game.

CPL (cost per lead): an advertiser pays for a lead who is interested in a service, such as an application for a bank card or credit, an appointment with a doctor or other similar actions.

CPC (cost per click): a rare and almost outdated type of affiliate marketing program in which an advertiser pays for every click on the link. The earnings from this model are minimal.

CPV (cost per view): an advertiser pays commission for every view or interaction received.

Sources of traffic

In the description of each of the offers, you will see a list of allowed channels for attracting customers. These are standard tools for online marketing. For quick results, many people start with paid advertising right away, but you can start without any investments.

Paid and free traffic

Free traffic can be obtained in two ways – search engine optimization and content marketing. Both methods require time and effort. For SEO, you need to create a website, prepare it technically for a rapid growth in search engines, write content for the queries and constantly refine it to improve positions in the search. In the beginning it will be difficult to generate some income, but with long-term planning, this channel gives good results.

Content strategies work according to the same logic, but in addition to promotion in search engines, they include work with social media platforms. For example, you can create and promote a blog or community, make videos on YouTube or write expert posts on different platforms, inserting an affiliate link in them. Some affiliates also use guerilla marketing techniques – they write answers on Q&A services, communicate with people in comments under publications, leave messages in thematic chats or forums.

All this can bring some income, but it’s difficult to scale and it doesn’t provide a stable passive income. From this point of view, paid promotion has more advantages:

• You control the volume of traffic

If you see that the strategy has worked, and the effort pays off, you can raise rates and bring more customers. This instantly increases your income.

• You can choose an effective tool for a particular offer

For example, some types of businesses are easier to promote on social media, and the audience of others converts better through the website.

• It’s easier to work with several programs

Having launched one successful campaign, you can switch to another and test different niches.

• It’s not necessary to choose between the role of arbitrage specialist and webmaster

You can develop your own websites and simultaneously promote advertisers’ offers through paid channels.

Top channels to attract traffic

Although each niche has its own set of effective tools, the first step is to explore all the possibilities. Where to find an audience?

Social media

Two tools are highly effective here: targeted ads and community building. For the best effect, you can use both. Facebook, Instagram, TikTok – they all have their own ad accounts where you can run campaigns. You need to make a creative for the ad, add a link to an advertiser’s website and select the audience’s settings to show an ad to the users potentially interested in the product.

Search Engines

We have already mentioned a free channel of promotion through SEO. The second is contextual advertising, which is shown in the output along with the actual search results. The main advantage of this tool is a high conversion rate, because you are working with a warm interested audience that is already looking for a solution for their pain points. The disadvantage is the high CPC bid costs. In addition, some offers limit the use of this tool.

Teaser Networks

These are platforms that allow you to place creatives in the form of banners. They are usually placed on affiliate websites with high volumes of traffic. From a content point of view, these are ads that create intrigue, so they use screaming headlines and bright pictures. They differ from targeted ads by simple moderation, which allows gambling, adult and other similar niches.

Native traffic

One of the problems with targeting and teasers is banner blindness: people simply don’t pay attention to colorful pictures, so their conversion is unstable. Apparently, platforms that work with native traffic are a good solution. They mask ads under the main content, so people click on ads and get to your page or an advertiser’s website.

Mobile Ads

Every year, the number of daily tasks that users perform with a phone in their hands is growing. Along with that comes more mobile traffic, so there are more tools for promotion. Some of them are unique and not available on desktops. Depending on the website, you can set up targeting by phone brands, operating systems, etc. Popular formats with high conversions are push notifications, display/banner, pop-unders.

Newsletters

Sending cold emails is usually a bad idea because of high risks of being blocked. But if you’ve just started developing your traffic sources, it’s worth collecting contact details of your users. This content strategy tool will help increase the effectiveness of other advertising channels.

How to start making money with affiliate marketing

There are millions of articles on the Internet on this topic, but it’s still difficult to understand where to start and how to develop in this direction. Terms, advertising channels, technical aspects – they can only be understood in practice. To get off to a good start, you need to move step by step.

Step 1: Choose a vertical

For a beginner, choosing a niche is the most important step, because the first results depend on it. Hopping from one niche to another isn’t the best strategy here, it’s better to start with a niche you know well or have a deep interest in. For example, you are good at cars. That doesn’t mean you need to limit yourself to just selling cars. You can promote products or services related to this niche:

• Auto loans
• Insurance 
• Services for selecting cars and car maintenance
• Service stations
• Online stores of spare parts, accessories.

If you don’t have a particular area of interest, you can follow the trends. At the start this can also be a good strategy that will generate some income.

Step 2: Sign up for a CPA network

There are networks that work with one specific niche, as well as those which have a catalog of offers from all niches, such as Indoleads. The second option allows for a quick switch if any strategy doesn’t work. For instance, travel niche didn’t work for you – just look for other offers from related niches in the catalog. On this step it’s worth analyzing popular offers in the chosen niche: what types of traffic are allowed, what conditions the company offers, what you need for that.

Step 3: Select marketing channels

Based on the details of the offers, you can choose the channels for promotion of goods or services more accurately. For greater effect, it’s better to work on several platforms at once: in addition to your website, you can build a social media presence, collect email addresses or phone numbers for mailing lists, launch a channel in a messenger, etc.

Step 4: Create content

In order to promote products and services efficiently, the content needs to be useful, but also commercial. For affiliate marketing, regardless of the site, several formats convert well:

Reviews: you can make a video of the product, talk about the features of the service or share your opinion on it.

Case: an advanced version of a review that tells how you can solve a problem or pain point through the use of a product.

Tutorials: this type of content helps to promote complex offers. You can tell what it is, how it works, what hidden benefits a person gets, etc.

Comparisons: a good format to help the audience form their opinion of the product and make a choice. After studying such detailed content, users are more likely to go to an advertiser’s website and take a targeted action.

Pages with sales: the target audience of many brands keep track of sales, so such websites help to get more conversions.

Step 5: Join affiliate program

You can find hundreds of different offers even in one niche. The Indoleads directory tools will help you choose the most suitable affiliate programs for your audience. Start with filters by verticals and payment models with types of targeted actions and analyze the rest by the following criteria:

• Rating
• Technical parameters: hold period, cookies lifetime period, confirmation rate
• Marketing metrics: eCPC, CR, etc.
• The list of allowed channels
• The amount of commission.

In addition to these criteria, it’s worth taking into account the competition: more and more affiliates join popular programs, so it will be more difficult to outbid their content. That’s why sometimes small local companies and brands are more profitable than big advertisers.

Wrapping It Up

CPA marketing is a great way to generate some extra income. No one says it can be implemented in a couple of days, but with consistency anyone can get the desired results. Indoleads is always here for you to offer the best affiliate programs and truly helpful customer support.