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Some people use affiliate payments as a way to profit from payouts. However, managing affiliate programs with payments is really a tool that can help business growth. Affiliate marketing influencers can write content and then link it to your products, sending their readers directly to your webpage. The increased traffic can mean new customers and a larger profit margin.
Discover the various ways affiliate programs payout their partners and affiliate payment meaning. From pay-per-click to revenue-sharing, this guide covers how to pay affiliates, including affiliate payment methods.
Four Types of Affiliate Payment Methods
The four main types of affiliate payments are:
- Pay-Per-Click (PPC)
- Pay-Per-Action (PPA)
- Pay-Per-Impression (PPI)
- Two-Tier Affiliate Programs (TTAP)
Pay-Per-Click is where an affiliate is paid based on how many readers click on their affiliate link. Pay-Per-Action is where an affiliate is paid per new lead they bring in or when they secure a sale. Pay-Per-Impression is where a merchant pays for clicks on their website ads. Two-Tier Affiliate Programs is where the affiliate marketer controls an underlying affiliate network and receives commissions for both its referrals and those from its network.
Best Affiliate Payment Methods and Solutions
Because affiliate network programs can be successful ways to gain and track customers, many eCommerce merchants and other companies use them. WordPress offers several plug-ins for managing affiliate marketing programs, including link tracking, to increase your conversion rates.
Other online affiliate platforms, including EverLink for ad networks, track publisher results on an affiliate dashboard. EverLink integrates with the Tipalti best-in-class AP automation and global partner payments software to make affiliate payouts through their marketing platform.
The best affiliate payment method solutions include:
- Secure self-service affiliate marketer partner and influencer onboarding
- Verified identity, contact information, and tax information for fraud prevention
- Choice of preferred payment method and currency for payouts
- Fast approvals and global payments
- Accelerated payments option
- 24/7 payment status
- Efficient automated global mass payment solution
- Artificial intelligence (AI)
- Automatic payment reconciliation.
Tipalti global partner payments and AP automation software meet these criteria as a best affiliate payment method solution.
Self-service Supplier Portal for Affiliates
Tipalti has a white-branded, self-service supplier portal that your business can use for its affiliate onboarding (and onboarding other suppliers). For data safety, the portal uses enterprise-grade security.
The Tipalti Supplier Portal guides affiliate marketing partners to enter their contact and preferred payment method information and IRS W-9 or W-8 forms data for payment and tax compliance needs. Tipalti tracks invoice payments and the portal provides views of submitted invoice history and payment history, plus status.
Verified Affiliate Identity and Fraud Protection
Tipalti automation software validates affiliates and suppliers with their tax IDS (TINs) to reduce fraud and increase tax compliance. The online business software also screens against blacklists and applies over 26,000 payment rules to reduce payment fraud and errors. Your business will achieve automated global regulatory compliance in addition to payment processing.
Affiliate identity verification is especially important because some bad actor publishers and other affiliates may try to game the system through fraud or unearned compensation by using multiple emails and identities. They’ll use bots, click farms, and other methods to unjustifiably increase their number of impressions and click rates. Your business should only pay for high-quality leads that are authentic.
Choice of Global Preferred Payment Method and Currency for Payout
Tipalti lets each affiliate choose a cost-effective payment method available in their country. Tipalti works in 196 countries, with payouts in a choice of one of 120 currencies, including the affiliate’s local currency. Tipalti also offers advanced FX functionality for foreign currency conversion of USD or another major currency to the affiliate’s local currency.
Tipalti payment methods include:
- Global ACH
- Prepaid debit card
- Wire transfer
- Live paper check
Cloud-based Tipalti AP automation and global partner payments software automates invoice flow, including guided email approvals with notifications to designated approvers. Approvals can happen from any location, including a mobile device. The approval process includes electronic document views of invoices matched with supporting documents, including purchase orders (POs) and receiving evidence for goods, when applicable.
Tipalti doesn’t use paper documents beyond OCR scanning and digital conversion. Businesses could lose paper invoices and matched documents before or during the matching process, or when they’re routed to approvers. Electronic approvals won’t be delayed due to the approver’s travel schedule. As a result, approvals are more prompt.
Accelerated Payments Option
Tipalti offers an accelerated payments option by selling customer invoices that would be in accounts receivable awaiting customer payment. This accelerated payments option is called Tipalti NetNow. With NetNow, your cash inflows will increase sooner and payees can receive earlier payments.
24/7 Payment Status of Submitted Invoices
The Tipalti Supplier Portal automatically tracks and notifies payees of invoice receipt and 24/7 payment status (from anywhere) of their invoices that have been submitted by email or uploading to the portal.
Efficient Automated Global Mass Payment Solution
Your global payouts to affiliates are efficient and fast, made in large scheduled bulk payment batches after approval of the invoices and batches. The time for making payments is greatly reduced, saving your company significant time and money.
Tipalti provides batch payment totals before and after payment, letting you manage cash flow. Although keeping affiliates happy with timely payments is best practice, when flexibility is necessary, your business can opt to put specific invoices in a scheduled batch on hold for later payment.
Artificial Intelligence (AI)
Tipalti offers artificial intelligence-driven automation with “touchless invoice processing” to replace manual invoices, matching, and manual data entry with OCR and automated electronic invoice processing before payment. The AI includes machine learning applications and robotic process automation (RPA) for accomplishing routine tasks.
Automatic Payment Reconciliation
Tipalti AP automation and global partner payments software automatically prepares real-time payment reconciliations for payment batches with multiple payment methods.
Because Tipalti is integrated with your ERP or accounting software, the automatic payments reconciliation helps your company speed up its accounting close by up to 25%. The accounting and finance department can shift its workload to more valuable projects for analyzing and improving business results.
How can your business improve its global affiliate payments?
Download our eBook, “How Digital, High-Performing Businesses Scale Payables” to learn how your business can scale and manage affiliate payments.
Use global partner payments and AP automation software with self-service affiliate onboarding, payments tracking, and validation processes to ensure payments efficiency and accuracy, global regulatory and tax compliance, and reduce fraud risk.
How Payments for Affiliate Programs Work
The affiliate manager is responsible for affiliate onboarding for beginners to start earning. These affiliates are partnering with the company as freelancers in marketing, independent contractor entrepreneurs, creatives, or publishers. Affiliate onboarding includes online orientation, access to tutorials, systems setup, including payment information, and follow-up communications.
Businesses pay affiliate commissions to bloggers and other content creators, social media influencers, and other afilliates that refer readers to their website landing pages through a link, increasing traffic. Some payouts are pay-per-click and others are pay-per-action, requiring lead information from the affiliate marketing referrer or sales. Payment methods and commission structures vary, requiring efficient influencer and affiliates payout solutions that can handle the variations in these global payments.
Types of Affiliate Payments
Businesses offer several types of affiliate programs for marketing campaigns, as described here in more depth.
Only bloggers or others who have high-traffic websites should use Pay-Per-Click. It requires their reader to click on links to bring him to your page, and every time this occurs, the writer receives a few cents. No sales have to be made; you are simply paying for the traffic that hopefully leads to new customers. As a company, you can refuse to pay the writer if you believe they are clicking the link themselves or through automated techniques that don’t offer new customers.
More money can be made by those willing to partake in pay-per-action. There are a few methods you can use to do this. The two most popular are through leads and sales. Another pay-per-action type is pay-per-call for resulting appointments for businesses like real estate sales and home improvement contractors.
Leads require the writer to gather information from their readers so that you can contact them about your products.
Sales use tactics similar to pay-per-click; however, the customer is tracked while on your site. If a purchase is made, your affiliate partner receives higher compensation. If residuals are included in the affiliate program, then the referrer also receives commissions on future sales from this new customer referral.
Pay-Per-Impression or Pay-Per-View
Businesses pay for clicks on their website ads. The term Pay-Per-Impression is usually measured and paid with pricing per thousand views, and it may be referred to as CPM (cost per thousand views). Pay-per-view or cost-per-view (CPV) is the cost for viewing each video ad when it meets the criteria. For example, Google’s definition of cost-per-view, relating to its video ads is:
“A bidding method for video campaigns where you pay for a view. A view is counted when a viewer watches 30 seconds of your video ad (or the duration if it’s shorter than 30 seconds) or interacts with the ad, whichever comes first.”
Two-Tier Affiliate Programs
The affiliate marketer controls an underlying affiliate network and receives commissions for both its referrals and those from its network. This type of affiliate program allows multi-level marketing.
Businesses may use a combination of affiliate program types. For example, Amazon uses both pay-per-click and pay-per-action for leads and sales in its Amazon Associates affiliate marketing program. Amazon also has an Amazon Influencer program.
Making Affiliate Program Payouts
Only one affiliate marketer receives payment for a customer action related to the most recent referral. Affiliate managers in businesses generally make affiliate payouts monthly.
Affiliate program providers set time limits (cookie life) for owing affiliate payments. If a referral doesn’t purchase by that time limit, then no affiliate commission is earned. An affiliate payment isn’t made immediately to avoid payouts on customer returns.
Affiliate commission payments can be creatively structured. Businesses can increase commission rates or pay bonuses to affiliate marketers when pre-set goal levels are achieved.
Payment methods include PayPal, prepaid debit cards, gift cards, checks, or direct deposit electronic ACH bank transfer payments to an affiliate’s bank account.
Affiliate payments are rather low and can be annoying to deal with each month. Instead, try mass payment options that can help take care of these payments for you. It allows you to complete easy marketing, without the stress of constant small payments.
Summing It Up
Your business can structure affiliate payments from Pay-Per-Click, Pay-Per-Action, Pay-Per-Impression, or Two-Tier Affiliate Programs methods to meet its objectives and the goals of your company’s independent affiliate partners.
The amounts and timing of these affiliate-related clicks, actions, leads, referrals, or sales can be small but frequently-occuring. Set a payments schedule for affiliates. To differentiate your affiliates or publisher network and gain loyalty, use Tipalti financial automation software with built-in communications and visibility. Tipalti is the best and most efficient software system for making accurate and timely affiliate payouts and reducing fraudulent payments.
With Tipalti AP automation and global partner payments software, you can onboard affiliates from global locations, verify their identity, and pay them at least monthly through an efficient mass batch payment using their preferred country-available payment method and currency. Download our eBook, “Why Payments are Critical to Creators and Influencers.”