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Basic Definitions
Many large Internet companies such as Yahoo, MSN and Netscape derive
some or most of their income from publishing. A published may earn
income through the following means:
• CPM – the advertiser is charged a rate for each 1,000 banner
impressions. The typical going rates are from $0.1 to $10.00.
• CPC – the advertiser only pays when a click to his advert occurs.
The most well-known CPC program is Google Adsense. The actual amount
paid per click is highly variable and may vary from $0.01 to $50.00
• CPA – the advertiser only pays if a click to his advert results in
a sale or lead. Typically, the payment rate is in terms of % of the
sale which varies from 3 to 70%.
Many regard affiliate marketing as entirely CPA
but quite often, many merchants will offer CPM and CPC as well. In
general, merchants prefer to pay by CPA whereas publishers would
like to be paid by CPM. However in the end, there is not probably
much difference in terms of cost to the merchant. In you have a
general untargeted website, it may be wise to go for CPM or CPC,
whereas if you have a targeted website, CPA may be a better idea.
Taking CPM, CPC or CPA adverts provide a means for small web site
owners to earn money by taking advertisements on their web sites. It
is almost completely risk free in the monetary sense and is thus
particularly attractive to persons who may wish to work at home. Two
options will be examined below. In the first option, the individual
acts as a publisher where he provides a web site that takes in
advertisements. In the second example, he signs up as an affiliate
for a shop-front program that provides a ready-made web site for him
to promote.
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