EPC (Earnings per Click) is an important metric used by affiliate networks for reporting merchant or affiliate performance. What does it mean, and how should one read it?
Some affiliate networks provide merchants and affiliates with an EPC figure.
When looking at the merchant/advertiser list at Commission Junction, one can see data for 3-month and 7-day EPC:
When looking at merchant stats on ShareASale, one finds 7-day and 30-day EPC figures:
How should one read this metric?
EPC stands for Earnings per Click. Unfortunately, the very abbreviation is misleading. In actual reality, EPC figures reflect EPHC, or earnings per one hundred clicks sent by affiliates to the merchant's website. It is calculated as an average based on all affiliate traffic (and corresponding sales) sent to the merchant within the specified period of time. In other words, EPC reflects an average affiliate program's payout per one hundred clicks.
By looking at the above screenshots, we can tell that over the period of the last 3 months, an average payout to AT&T affiliates has amounted to $88.65 per every 100 clicks sent to AT&T, while Adobe's affiliates have been earning an average of $27.49 on every 100 clicks referred. Interestingly enough, Apple affiliates have been earning $37-38 per 100 clicks, regardless of the incredibly low 1% commission that this merchant is paying, which indicates that the brand converts extremely well (another example is, of course, Air France).
Based on the above elaborations, the formula for calculating EPC in the affiliate marketing context is:
EPC = Profit ÷ Clicks × 100
While Commission Junction does not display conversion rates (as ShareASale and AvantLink, for example, do), the EPC metric is still a good indicator of what to expect from an affiliate program. Without the data on the conversion ratio, and reversal rates, the EPC figures are by no means 100% transparent (and should not be read word for word), but it is still a good measurement to have, and more affiliate networks should be making it public.