Regardless of what you may hear about affiliate marketing being an untapped goldmine waiting for you to become the Internet’s next millionaire, you gotta be careful. Campaigns where as an affiliate you are remunerated for performance only require (i) a careful and educated approach, and (ii) taking it easy. Otherwise, your affiliate role may end up being a complete fiasco, turning you into another skeptic that failed due to his/her own mistake.
Focusing on any one metric is always a deadly mistake; even more so when this metric is the affiliate program’s EPC (abbreviation originally created to signify a program’s average affiliate’s Earnings per Click). Most affiliate networks display EPC data to you even before you join an affiliate program. There are two things you shouldn’t do with that information:
1) Understand EPC Literally — In the vast marjority of cases EPC now means Earnings per 100 Clicks, and not per single click [more here].
2) Budget Your Campaign Based on EPC — If you’re planning on buying traffic (be it via PPC, or any other method), you gotta be especially careful with how you use the EPC data. One of the costliest mistakes is to merely divide the EPC figure by 100, and budget your marketing campaign setting the result of this basic arithmetic operation as the amount you’re willing to pay per click/visitor [see the below example].
Let’s take a health insurance affiliate program as an example. Below is the information you will see on it (prior to joining it):
The program’s 3-months’ EPC is $16.56. Dividing this number by 100, we will arrive at an average affiliate earning of $0.16-$0.17 per click.
Here’s the part you do not see (top 10 affiliates’ EPC in the program):
Do you see how different the amounts are in every case? They range from $5.45 to $292.24 in earnings per 100 clicks, but you don’t know this when you’re looking at the average; and the individual affiliate’s EPC data is only available to the merchant.
There are also other important factors that you do not know, but the above one already illustrates the point well.
Averages are good to know, but always tricky, and should be treated as such.
Never base your decision on any single metric, especially if this metric is an average.