What’s the difference between CPA and CPS in affiliate marketing?
CPA (Cost Per Action) and CPS (Cost Per Sale) are both pricing models used in affiliate marketing, but they differ in terms of the action that triggers the commission payout to the affiliate marketer.
CPA refers to a commission payout made to an affiliate marketer for a specific action, such as filling out a form, signing up for a free trial, or completing a survey. In CPA marketing, the advertiser pays the affiliate marketer for a specific action, regardless of whether or not the action results in a sale. The commission rate for CPA offers is typically lower than for CPS offers since the advertiser is taking on more risk.
Since no sale has been made yet, CPA usually implies a fixed payout amount, such as $10 or $50. Generally this payout amount is set by the advertiser to account for the expected probability of making a sale, as well as the value to the advertiser if a sale is made.
CPS, on the other hand, refers to a commission payout made to an affiliate marketer for a completed sale. In CPS marketing, the affiliate marketer is paid a percentage of the sale amount when a customer makes a purchase through their affiliate link. CPS offers generally have higher commission rates since the advertiser is only paying out when a sale is actually made.
In summary, CPA offers pay out for a specific action taken by the customer, whereas CPS offers pay out only when a sale is made. The former tends to be fixed currency amounts, whereas the latter tends to be a percentage of the actual sale value.