EPC Explained on Commission Junction

If you do affiliate marketing, you almost surely use Commission Junction to some extent.  CJ has an easy-to-use interface and a wealth of good merchant opportunities.

EPC on Commission Junction is a tricky thing that many affiliates don’t understand.  Remember, that the Latin symbol “C” equals 100.  Let’s assume that a merchant’s EPC is $39.59.  This means that the average site that gets 100 clicks on this merchant’s advertisements earns $39.59.  Therefore, the average value of a click on this merchant is just shy of .40 each.

Why Network Earnings is More Important

EPC, however, doesn’t tell the entire story.  Network Earnings (NE) might give a better indication of the overall effectiveness of the merchant in question.  The Network Earnings is the graph that shows five segments in a green bar.  Merchants are ranked from one to five on the green bar graph.  The Network Earnings indicates the overall percentile rank of the merchant in 20% segments.

Network Earnings is actually the more important of the two.  The reason is that a merchant could have a decent EPC, because it’s based on the conversion ratio of those who click.  Network Earnings, however, indicates the earnings of the merchant in relation to total exposures.  Hence, Network Earnings is a better indicator of the overall effectiveness of the campaign.

Let me give you an example.  One merchant that I looked at was ranked 7th out of 16 sites in its category for EPC so it was slightly above average in the EPC category.  When I looked at NE, however, it was in the lowest quintile.  Therefore, what this means is that this particular merchant did ok when consumers actually clicked on the advertisement, but not a whole lot of consumers were clicking in the first place.

This entry was posted on Monday, April 6th, 2009 at 2:41 pm and is filed under Affiliate Marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.