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.
Geno Prussakov is the Founder & Chair of Affiliate Management Days conference, Founder & CEO at AM Navigator, author, internationally known speaker, and a guest blogger at Econsultancy.
Recommended reports
Affiliate Census 2011
The Affiliate Census 2011 is a comprehensive survey of more than 300 affiliates, which looks in detail at the nature and quality of relationships affiliates have with networks and merchants. The report is essential reading for those who want to know more about affiliates, including how much revenue they are generating, how they are getting their traffic and which linking methods they are using.
Alternatively, see our Affiliate Marketing Buyer's Guide 2010 or Quarterly Digital Intelligence Briefing.
9:29PM on 18th May 2009
Hi,
It's common in the UK for EPC to be just that, per single click.
At Affiliate Window we display the information as such.
Completely agree this data should be given by all networks but must be caveated given how certain types of activity can significantly skew the figures.
We've attempted to apply standard deviation to our EPC data as well as display click to sale conversions, number of sales approved out of a hundred and turnaround times on those sales.
Some other networks display elements of this data but it's always surprised me it's not more readily available.
Founder at AM Navigator LLC
10:01PM on 18th May 2009
Kevin,
Thank you for your comment. I wasn't aware of the fact that in the UK EPC is calculated based on earnings per click. So, thanks for brining this up.
Yes, the more transparency there is in this industry (and the metrics arsenal is a good place to start), the better.
2:17AM on 19th May 2009
Hi,
I'm new at Commission Junction, I'm using Google Adwords for my ads.
So far, I have 400 clicks up to this day ( a 7 day range). Will I earn money from those clicks? And so far, I have no leads or sales at this time.
It's been 7 days had past but my 7-day EPC displays $0.00. When will it reflect in to my account? Or does 7-day EPC updates daily?
Thanks. Please send me feed back asap.
Founder at AM Navigator LLC
4:04AM on 19th May 2009
Mark,
The fact that there have not been seeing any sales/leads to this point is worrying. Unless things change by the time you reach 700-1000 clicks, I strongly suggest you reevaluate your approach (either to the way you're marketing, or to the choice of merchant(s)). I hope you know what you're doing (as far as PPC marketing goes). If you're just experimenting with paid search, take it slowly, one step at a time, with a lot of testing, and making sure you're running well-targeted ads.
There is still a chance you can get paid (if the visitors you have referred place their orders within the cookie life period set by the merchant), but in my experience a vast majority of affililiate-referred orders (over 75%) happen on the day of click.
7:57AM on 19th May 2009
Hi, Thanks.
Does Commission Junction Pays for clicks, I mean like Pay-Per-Click, I'm near spending $200 for the placements of the ads yet no earnings on my account reflected.
8:00AM on 19th May 2009
Please add me on YM, probably I could ask from you ther, I have some questions. Please use the E-mail add I used to post this comment. Thanks
8:42AM on 19th May 2009
EPC almost always stand for earnings per hundred clicks - in the UK too. This is supposed to be a GUIDE line, not a fact.
I would not expect to get many (if any) sales in one weeks time, depending on the merchants I work with so, this depends on what products/services you promote.
@Mark - it's hard to comment on your stuff without knowing what programme you're with, products/services that you promote, what you use to promote them etc. All that CAN and SHOULD be said is that you need to go and have a look at the ToS of the network (CJ, Tradedoubler etc) and the merchants details too.
8:50AM on 19th May 2009
Thanks Claudia.
I'm with Bistro MD, it's because I'm new at affiliate marketing...
what's your advise?
9:39AM on 19th May 2009
@Claudia, I'm a client in the UK running a number of affiliate schemes across two networks. We always use EPC to define earnings per single click as well as ECPM to understand the effectiveness of our individidual programmes against other activity occuring within different channels. In addition this provides an easier competitor comparison across aggregatiion services.
This is how we work, and how our programme works - quite frankly though, it's not the most complicated mathematical formula.
Founder at AM Navigator LLC
3:17PM on 19th May 2009
Claudia, thank you for your comments. I have just looked into the reports at several UK affiliate networks and many (AffiliateFuture, PaidOnResults, TradeDoubler, WebGains) calculate EPC based on 100 clicks.
Kevin, which other UK networks base it on earnings "per single click"?
Mark, you do seem to be new to affiliate marketing. My advice would be to stop your PPC campaigns until you figure out whether you are paid for those clicks or not (more than likely it's the latter). Merchant's program terms would be the first place to look. I'm on my YIM, and would be happy to help you too.
Tom, ECPM as eCPM, or effective Cost Per Thousand impressions? I'm asking, because impressions that you get from affiliate activity are not the same as impressions that you get through any other channel (as you don't pay for the former).
4:06PM on 19th May 2009
Thank you for the info.
I think it is also useful to check the 12 month trend for whatever merchant you are considering promoting. That way you can get a bigger overall picture of how that specific program is performing.
I know you can do this in CJ if you click on the name of the advetiser, and then next to "3-month EPC" click on "view trend"
Thanks again!
Founder at AM Navigator LLC
4:30PM on 19th May 2009
Ron, I agree. The longer the period you're looking at, the more accurate the information you get.
2:46AM on 20th May 2009
Thanks. How much would be the average cost-per-click you pay for your ads for the keyword "loan" in UK?
10:36AM on 27th May 2009
Hi Geno,
We've always reported in single clicks, I know TD and CJ report in per hundred clicks.
dgm historically reported in single clicks. Some other UK networks don't publicly release this information.
Rather than use it as a definitive guide for basing activity on I'd always encourage any affiliate to contact their network account manager to gauge how potentially skewed the EPC data is by the affiliate mix for that particular programme.
Thanks,
Kevin
10:45AM on 16th June 2009
a great post, many thanks
Founder at AM Navigator LLC
5:37PM on 16th June 2009
EPC has been chosen as the 4th "most important factor in choosing a merchant" (after payout, affiliate management and brand awareness). See first pie chart in this post of mine.
12:59AM on 5th August 2009
The EPC at CJ is a good general indicator of how well affiliate programs are performing but you shouldn’t take it as the be and end all for choosing an affiliate program, there are other useful indicators.
For example you could also look at the 2 EPC time periods, 7 days and 3 months and look at network earnings to decide which affiliate program to choose. I did write a blog post explaining commission junctions and it’s EPC at
http://blaineblogger.com/commission-junctions-epc-explained/
Blaine
11:09AM on 12th February 2011
Thanks all of you for your comment and the answers, at least i had my question answered. Thanks again.