Ecommerce8 min readUpdated October 15, 2026

What Is Affiliate Marketing, and How Does Affiliate Tracking Work?

Affiliate marketing explained: how click IDs, postbacks and webhooks track a sale, the commission data model, and what refunds and chargebacks reverse.

Nick Bonnassies, CMO at Tagada · checked against 10 sources

Article summary

TL;DR

Affiliate marketing is a performance channel where a merchant pays outside partners, called affiliates or publishers, a commission when their tracked link or code produces a sale or lead. A click ID ties the visit to the partner, the merchant reports the order to the affiliate platform, and refunds or chargebacks reverse the commission before payout.

Four parties: the merchant, the affiliate, the network or platform that tracks and pays, and the customer.
A click ID travels from the affiliate link to your order. Store it server side and send it back with the conversion.
Pixel, server-to-server call, postback and webhook are four different pipes. Most programs need two or three of them.
A commission is a record with a status: pending, approved or reversed. Refunds and chargebacks should move it automatically.
In the US, the FTC expects affiliates to disclose the paid relationship next to the link, and merchants to monitor their partners.

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On this page

Affiliate marketing is how a brand pays partners only for the sales they send. The idea fits in one sentence. The plumbing behind it doesn't: click IDs, server-to-server calls, postbacks, product feeds, and a commission that has to follow the payment through refunds and chargebacks. This page covers both.

What affiliate marketing is

Affiliate marketing is a performance channel. A merchant (also called the advertiser or brand) gives partners a tracked link or a promo code. The partner (affiliate or publisher) promotes it. When a visitor buys, the merchant owes the partner a commission.

Four parties are involved:

The merchant, who sells the product and takes the payment.
The affiliate: a content site, coupon or cashback site, creator, newsletter or comparison site.
The network or affiliate platform (Awin, impact.com and others), which issues links, records clicks and conversions, and usually pays partners.
The customer, who clicks and buys.

Commissions come in a few shapes. The rate is set in each program's terms.

Model	The partner is paid for	Fits
Cost per sale (revenue share)	A percentage of the order	Ecommerce
Flat CPA	A fixed amount per order or action, whatever its value	First orders, sign-ups
Cost per lead	A form, a trial, a quote request	Finance, software, services
Recurring commission	Each renewal while the subscription runs	Subscriptions
Cost per click	A valid click, sale or not	Buying traffic, not sales

How affiliate tracking works

Every program, whatever the network, runs the same loop.

The click. The affiliate link goes through the network, which adds a click ID to your landing URL. Awin calls it the AWC (awc); impact.com calls it the ClickId.5 1
You store it. Your site saves the click ID with the visitor. Awin requires the cookie to be set by an HTTP response header, not by a script, with the HttpOnly and Secure flags.5
The payment succeeds. The order is real only once the payment is confirmed, for example on Stripe's payment_intent.succeeded event.8
You report the conversion. Your server sends the click ID, order ID, amount and currency to the network. Awin asks for this call within the first two minutes, preferably, and ignores calls sent more than 3 minutes after the browser tag when it ranks tracking methods.5
The network validates. The commission sits as pending while you can still amend or decline it.
Approval and payout. Pending items you don't touch get approved. In Awin's WooCommerce plugin, the default approval delay is 30 days.6

Field names from Awin and impact.com docs. Other platforms use the same logic under other names.

Pixel, server-to-server, postback, webhook

People search these words together because they overlap. They are four different pipes.

Pipe	Who calls whom	What it carries	Weak spot
Browser pixel or tag	The buyer's browser calls the network from your thank-you page	The order, read in the page	Ad blockers, closed tabs, cookie limits
Server-to-server (S2S) or conversion API	Your server calls the network	Click ID, order ID, amount, currency, items	You must keep the click ID until payment
Postback	The network calls a partner's URL, filling placeholders like `{Oid}` or `{RefClickId}`	The conversion, for the partner's own tracker	Only as good as the data you sent in
Webhook	Your payment processor calls your server	Payment events: paid, refunded, disputed	Duplicates and events out of order

impact.com, for example, can fire postbacks to a partner's system on each event, so the partner gets the data without adding a pixel to your site. You choose the HTTP method, a rate limit and a minimum delay.3 For the browser side, see what pixel tracking is. For sending events from your server to ad platforms, see our guide to server-side tracking.

The data model of an affiliate program

Under the dashboards, an affiliate program is a handful of linked records. Here is one sale, as a network would store it.

Conversion · order #A1042Partner: a review site · Click ID stored at landing

Click ID: Stored server side, sent with the order
Order ID: A1042, unique per order
Amount: Pre-tax, pre-shipping, after discount
Customer status: New or returning
Promo code: Can attribute the sale to a partner
Items: SKU, quantity, price, category
Commission: Pending until the validation period ends

Illustrative record. Field names follow impact.com and Awin documentation.

The fields come from the networks' own references:

Conversion. impact.com's Conversions endpoint requires a program ID (CampaignId), an event date, an OrderId, an event type, and an attribution key such as ClickId or CustomerId. CurrencyCode is required when you send amounts, and item fields like ItemSku become required when you report items.1
Amount. impact.com defines it as pre-tax, pre-shipping and post-discount, and its payout amount excludes tax and shipping.2
Commission group. Awin's S2S call sends parts as commission group and amount, DEFAULT unless you pay different rates by group, plus vc for the voucher code and customeracquisition for NEW or RETURNING.5
Reversal. A separate record with the order ID, the new amount (0 to reverse the whole order), the SKU for item-level changes, and a reason code such as RETURN or ITEM_RETURNED.2

Product feeds and creative assets

Two more objects feed the partners rather than the tracking:

Product feed
Your catalog as a file the network ingests. impact.com accepts Google Merchant Center format (tab-delimited TXT or XML) or a custom CSV or XML, up to 1 GB per upload, compressed or not. Awin's WooCommerce plugin publishes a CSV feed refreshed daily at the same URL.
Creative assets
The ads partners place. impact.com's Ads API creates three kinds: banners, coupons and text links, and updates them, creative file included. Retire expired coupons there, not only on your site.

Sources: impact.com Catalogs and Ads API, Awin WooCommerce plugin.4 6

Refunds, chargebacks and commission clawback

This is where affiliate marketing meets payments. A commission is earned on a sale. If the money goes back to the customer, the commission should follow.

Stripe charge.refunded, full refundNo sale left to pay onReverse the order: amount 0, reason code
Stripe charge.refunded, partial refundStripe fires this event for partial refunds tooItem-level reversal: SKU, new quantity, new amount
Stripe charge.dispute.createdThe customer disputed the charge with their bankHold or reverse, per your program terms
Stripe charge.dispute.closed, wonThe dispute ended with status wonRestore the commission if your terms say so

Event names and meanings come from Stripe's event reference; the reversal fields from impact.com.8 2

Mind the timing gap. A pending commission is easy to reverse. An approved one is not. Awin's WooCommerce docs say the usual practice is to set its auto-validation to your return period plus 15 days.6 But a card dispute can usually be filed within 120 days of the payment, and the bank's decision takes 2 to 3 months in total.9 So some chargebacks will land on commissions already paid. Write the clawback in your program terms before you launch.

Make the webhook handler safe. Stripe retries deliveries for up to three days in live mode, doesn't guarantee event order, and can send the same event twice. Log event IDs, verify the Stripe-Signature header, and return a 2xx before doing the slow work.7 A duplicate charge.refunded must not reverse the same commission twice.

Example: a sale with a one-click upsell

Illustrative numbers. A visitor clicks a partner link and buys a $60 bundle at 10% commission. After checkout, they accept a $30 one-click upsell, charged separately.

Step	Sent to the network	Commission
Order paid	Click ID, order A1042, $60	$6.00 pending
Upsell paid	Same click ID, upsell SKU at $30, as a new item or conversion per your network's setup	$9.00 pending
Upsell refunded	Item reversal: upsell SKU, quantity 0, reason code	$6.00 pending
Validation period ends	Nothing	$6.00 approved

If the upsell charge never reaches the network, the partner is underpaid. If its refund never does, the partner is overpaid. Both come from the same gap: payment events that don't reach the affiliate platform.

Affiliate marketing vs referral marketing

	Affiliate marketing	Referral marketing
Who promotes	Outside publishers and creators	Your existing customers
Reward	Cash commission	Usually store credit or a discount
Run through	A network or affiliate platform	Often a referral app in your store
Tracking	Click ID, promo code	Referral link or code

Verdict

Same mechanics, different partners. Affiliates are businesses you pay. Referrers are customers you thank.

Disclosure rules for affiliates in the US

The FTC's Endorsement Guides apply to affiliate links. The FTC says affiliates "should disclose your relationship to the retailer clearly and conspicuously", and that the closer the disclosure is to the recommendation, the better.10

Consumers might not understand that "affiliate link" means that the person placing the link is getting paid for purchases made through the link.

FTC, FTC's Endorsement Guides: What People Are Asking

The FTC adds that "paid link" right next to the link should be adequate, while "commissionable link" probably isn't clear. For merchants, it says advertisers need "reasonable programs in place to train and monitor members of their network", and that handing the program to an outside company doesn't remove that responsibility.10

How Tagada helps

Payment events and tracking from the same checkout

Tagada's checkout sends tracking server side to Meta, Google and TikTok, and runs one-click upsells and order bumps in the same flow, so each extra charge belongs to the order it came from. Payments route across Stripe, Adyen and our own TagadaPay processor with one logic. Your affiliate network still tracks partners and pays commissions. See pricing for plans.

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Updated on October 15, 2026

Nick Bonnassies

CMO at Tagada

CMO at Tagada. Before Tagada, Nick built direct-to-consumer brands that generated over $115M in sales, raised over $25M in crowdfunding and sold two of them. He also works as a fractional CMO on marketing operations and AI systems.

Frequently asked questions

What is affiliate marketing in simple terms?

A brand gives a partner a personal link or code. When someone buys through it, the brand pays the partner a commission. The partner can be a blogger, a creator, a coupon site or a newsletter. The brand pays for results, not for the audience.

What is a postback URL in affiliate marketing?

A postback URL is an address on a partner's server that the tracking platform calls when a conversion happens. The platform fills placeholders in the URL, such as the click ID, order ID and amount, so the partner's own tracker records the sale without a pixel on your site.

What is the difference between a postback and a webhook?

Both are server-to-server HTTP calls. In affiliate jargon, a postback is a URL with placeholders that a tracker fires at a partner. A webhook is an event a platform pushes to you, like Stripe sending charge.refunded. Your webhook handler is often what triggers the conversion call or the commission reversal.

What happens to an affiliate commission when an order is refunded or charged back?

It depends on timing. While the commission is still pending, you reverse it, in full or for the refunded items only. Once it's approved or paid, recovering it depends on your program terms. A chargeback can arrive months after the sale, so align your approval window with your refund and dispute exposure.

Do affiliates have to disclose affiliate links?

In the US, yes. The FTC says affiliates should disclose the relationship clearly and conspicuously, close to the recommendation. It notes that "affiliate link" alone may not be understood, while "paid link" next to the link should be adequate. Merchants should train and monitor their partners.

What is the difference between affiliate marketing and referral marketing?

Affiliates are outside publishers promoting you as a business, usually for cash commissions, often through a network. Referral programs reward existing customers for inviting friends, usually with credit or discounts. The tracking is similar: a link or code tied to the person who sent the buyer.

Sources

Checked October 15, 2026

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