Is the cost-per-click (CPC) pricing model different from the commission (CPA) model when it comes to performance?

Whether retailers use a CPC pricing model or a commission model, they are looking to hit a certain performance target (sometimes called return on ad spend or return on investment) for the traffic they are purchasing. A CPC retailer uses a Cost of Sale metric, which is the cost that the retailer has for buying traffic divided by the amount of sales that the traffic generates. A commission based retailer uses a commission rate (sometimes called a CPA rate), which is the % of the net sales they are willing to pay out as a commission. In both cases, Cost of Sale and commission rate metrics are the percent of the total sales that the retailer pays out for the traffic.

Example that shows how the models are similar: You drive $100 in sales to a CPC retailer and get paid $12 based upon your number of clicks and CPC rate. The COS for your traffic is 12%. For a commission based retailer, you drive $100 in sales at a 12% commission rate. This earns you $12 in commission earnings. You can see how the models are very similar.