Earnings Per Click Improvement/Loss Calculator
What does EPC in Marketing Mean?
For internet marketers, EPC is the estimated average earnings per click.
This metric is an average number and is used to optimize online marketing campaigns so that they produce the highest revenue possible.
It’s important to know that not every single click generates revenue, only the ones that generate conversions.
The reality is that, clicks that do not generate conversions have a value of zero and the clicks that generate conversions have a value that is equal to the revenue they generate.
Earnings Per Click Formula
The formula for EPC is revenue divided by the number of clicks.
Earnings Per Click = Revenue / Clicks
Does Having A Higher EPC Equate to Higher Earnings?
One big point of confusion when trying to optimize a campaign is sorting out whether EPC or CTR is more important.
What matters the most is the amount of revenue generated and the profit margin.
A landing page can be optimized in a way where the CTR will increase but the number of total conversions do not.
The result of that circumstance would be increased CTR and decreased EPC as the revenue has not changed.
The Best Point To Measure Clicks From
In many cases, the number of clicks is tracked and calculated from clicks on a link a page.
The problem with that, is that counting clicks on a page doesn’t take in to count the cost of the clicks to the page that the link is on.
In a typical online marketing scenario there would be clicks flowing from a traffic source to a landing page, whether the traffic is a paid traffic source or not.
That landing page may contain a link to an affiliate vendor or a check out button and the clicks on those links can easily be tracked with analytics.
Since the cost to acquire the traffic is typically based upon clicks, calculating EPC based upon the number of clicks to the affiliate link or check out button, does not represent the actual profit or loss per click.
When calculating EPC, the number of clicks used in the estimate should always be the number of clicks from the traffic source.
Using the amount of traffic coming from the source allows you to easily calculate profit per click by subtracting the EPC from the CPC.
Note: The numbers reported by affiliate networks do not factor in the cost of traffic to the landing page, only the EPC for clicks on the link.
Many people who are beginners to affiliate marketing get confused when they see what appears to be “impossible earnings per click numbers” on affiliate networks like ShareASale.
It is important to note that in many cases when discussing earnings per click with in the context of affiliate marketing, the stated EPC is really the earnings per 100 clicks.
As an example, an affiliate network may say that a vendor on their network has an average earnings per sale of $20 but the earnings per click reported on the network is $200.
It is highly unlikely that each person clicking the link is purchasing 10 units at $20 each and it’s almost certain that the affiliate network is displaying the average earnings per 100 clicks.
The actual average earnings per click would be 1% of the stated $200 EPC and would be $2 in the terms of the actual average earnings per click on the network for that vendor.
You can easily tell because $630.81 for each click sent to a company that sells mattresses is nonsensical.
The formula for earnings per click for affiliate marketers is revenue divided by the number of clicks times 100.