How affiliate commissions work
When someone buys through your link, the brand pays you a share of the sale. Most programs pay a percentage of the price: often 1% to 10% for physical goods, and 20% to 50% or more for software and online courses. A cookie remembers the click for a set time, commonly 1 to 90 days, so you still get paid if they buy later.
Some programs pay a flat amount per sale or sign-up instead. To model one, enter the flat amount as the price and set the commission to 100%.
The formulas
Earnings per sale = price × commission rate. Sales = clicks × conversion rate. Monthly earnings = sales × (1 − refund rate) × earnings per sale. EPC (earnings per click) = monthly earnings ÷ clicks.
A $49 course at 30% commission pays $14.70 a sale. With 2,000 clicks, a 2% conversion rate and 5% refunds, that's 38 sales kept, $558.60 a month and an EPC of about $0.28.
Why EPC beats commission rate
A high commission looks great, but it means little if few people buy. In the example, Program B pays only 8% on a $120 product, yet it converts twice as well and earns more per click than the 30% course. EPC folds price, commission and conversion into one number, so it's the fairest way to compare programs.
Read the terms on refunds too. Most programs take back commission on refunded or returned orders, which is why many hold payouts for 30 to 60 days.
What moves your conversion rate
Many affiliate links convert somewhere between 0.5% and 5% of clicks. Where you land depends on a few things:
- Fit: products you actually use convert far better than ones you tried once.
- Placement: a link inside a tutorial or review beats one dropped at the end of a caption.
- Price: cheaper products convert better, so compare EPC, not just commission.
- Cookie length: a 30-day cookie catches buyers who think it over; a 24-hour cookie doesn't.
- Findability: keeping your picks on one link-in-bio page means followers can find them after the post scrolls away.
Frequently asked questions
How do I calculate affiliate commission?
Multiply the sale price by the commission rate. A $60 product at 10% pays $6 a sale.
What is EPC in affiliate marketing?
Earnings per click: your total commission divided by the clicks you sent. It's the best single number for comparing programs.
What's a good EPC?
It varies a lot by niche. Many affiliates see somewhere between $0.10 and $1 per click, and software and finance programs can pay more. Compare programs against each other rather than chasing a fixed number.
What's a typical affiliate conversion rate?
Often around 0.5% to 5% of clicks, depending on how much your audience trusts you and how well the product fits them.
Do refunds reduce my commission?
Usually, yes. Most programs reverse commission on refunded or returned orders, so it's worth adding a refund rate to your estimate.