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What Does "Pay per Sale" Mean?

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  • Written By: Alex Newth
  • Edited By: Angela B.
  • Last Modified Date: 02 November 2016
  • Copyright Protected:
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    Conjecture Corporation
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Pay per sale (PPS), also known as cost per sale (CPS), is an online affiliate term that refers to how the advertiser pays a publisher or affiliate. In this agreement, the advertiser will pay the affiliate a commission or flat rate for every qualifying sale. This can be done offline, as well, but finding a company with offline pay per sale affiliate terms is rare. While this is one of the most common affiliate terms, contrasted by other payment terms such as cost per action (CPA) or pay per impression (PPI), it is seen as least favorable to publishers. This is because they have to worry about whether the advertiser’s site is working and if the sale can really be made once the person leaves the publisher’s website.

The pay per sale system is one of the simplest online marketing payment terms. In this agreement, a business website agrees to pay an affiliate for every sale made. For example, the advertiser sells fancy napkins. The publisher builds a website around the fancy napkin topic, attracts visitors and those visitors click a link to visit the advertiser’s website. When that visitor purchases a napkin, the publisher is paid.

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Payment terms for pay per sale are either commission or flat fee. The more common of the two is commission, in which the publisher receives a percentage of the total sale. If the advertiser is offering free items, then they will often offer the publisher a flat fee for such items. This information is different for each advertiser and should be clearly written in the affiliate agreement.

Offline pay per sale marketing is rare. This is because it is more difficult for the publisher, and it is difficult for the advertiser to tally the amount of sales made. In this type of agreement, the publisher may receive a special phone number and, when someone calls that number, the publisher will receive his or her commission.

Other types of affiliate payment terms include CPA, PPI and pay per click (PPC). CPA is similar to PPS, but the action required is usually getting visitors to fill out a form. PPI means the publisher gets paid, usually a very small amount, for each impression on his or her website. PPC means the publisher receives payment when the visitor clicks an affiliate link.

Pay per sale is considered more favorable for advertisers than for publishers. Publishers have to do a lot of work to get traffic, and the publisher has to ensure the traffic is high-quality and willing to click links. The publisher also has to worry about the advertiser’s website in regards to whether it is working and if the website is powerful enough to convert the traffic into sales. The advertiser just sits back and waits for that incoming traffic to convert into sales, making this much better for the advertiser.

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