Payout in Native Ads
Payout is the amount of money that an advertiser gets for promoting an offer.
What is payout?
In the arrangement between an offer owner and advertiser, the former agrees to reward the latter with money whenever the advertiser enables a conversion to occur. A payout is either such a single reward or a complete stream of money that the advertiser gets.
The amount of payout depends on the agreement between them and is usually flat for a given conversion type of a particular offer.
Payouts are not paid directly to the advertiser after each conversion. Instead, they top up the advertiser’s account in the affiliate network. In most cases, affiliate networks allow to withdraw money only once they’ve reached a payout threshold, typically $100.
Types of payout
Offer owners can have different commission schemes to reward an advertiser for their work. The most popular types are:
- Pay per sale or install, when an offer owner pays an advertiser when a visitor makes a desired action, such as purchases a product, or installs an app.
- Pay per lead, when an offer owner pays an advertiser when a visitor leaves their contact details (email, phone number, home address, or other).
- Revenue share, when an offer owner pays an advertiser a fraction of the revenue a visitor brings them. This is a popular method of settling costs for offers that implicate long-term investment, such as Forex brokers or crypto traders.
- Hybrid, which is a mixture of the ones above.
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Upsells and other payout types
A single visitor may generate more than one conversion, and therefore, bring more payout. Subsequent conversions (when, for example, a visitor purchases the same product twice) are called upsells.
The same visitor can also generate different conversion types (for example, app install and in-app purchase) which bring different payouts. It is important to differentiate between different conversion types when setting up tracking.
Payout vs profit
Payout is only one side of the equation, not its outcome. This means that a payout is not equal to a profit. A profit is the money left after all expenses have been paid, while payout is your earnings before you deduct those expenses.
To put it in mathematical form, payout minus costs (traffic and taxes) equals profit.
Payouts are usually tracked using S2S postback URL or conversion pixels. The first method passes all identifying data in tokens, while the second one relies on cookies to store that information.
Postbacks are considered more reliable, easier to set up once the infrastructure on both sides has been prepared, and, as they do not rely on cookies, immune to various privacy-regulating techniques.
Pixels are great when you are the offer owner and don’t have the time or skills to implement a postback infrastructure yourself.
The third option that recently is gaining popularity is tracking payout with the use of API connection. Conversion and payout information are sent using the most reliable method. However, API integration requires a lot of development work on both sides and because of that, it is rarely used.
Voluum Tracker, which is the foundation that the Voluum DSP is built on top of, offers API integrations with two affiliate networks: Clickealer and Clickbank.