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Are affiliate programs a rip off?
ClassyPete

10+ Year Member



 
Msg#: 11264 posted 6:27 pm on Feb 16, 2006 (gmt 0)

I consider affiliate programs (where you earn money only after a sale/lead is generated) a rip off. You are providing them with FREE advertising (branding)and usually getting very little in return. It's too good of a deal for the advertiser and not the publisher.

Here is an example...

I run an automotive website and have some links for car insurance companies (affiliate programs) they pay anywhere from $4-$9 per LEAD (valid, quote request form filled out)

Then I look at their ppc advertising on google/yahoo and they are paying $5-$9 PER CLICK! Who knows how many clicks they need to get one valid quote.

I also recently spoke with an affiliate manager for a insurance quoting service and when I asked why other companies are paying so much per click and so little per lead she had no answer for me.

I had the same problem with auto financing, was only getting paid $50 per Sale and finally made a deal with a small lender and they are paying a flat monthly fee that is five times as much as I was earning with an affiliate program!

Am I missing somehting?

 

ronin

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 11264 posted 6:33 pm on Feb 16, 2006 (gmt 0)

You can take the different revenue models - CPM, CPC and CPA - and reduce everything to CPM so you can compare the effectiveness of different types of creative.

You will find that - given that you are publishing quality pages - CPC creatives will almost certainly out-perform CPM creatives every time.

Sometimes CPA creatives will and sometimes they won't.
It depends on how qualified the traffic is that you are sending through.

FourDegreez

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 11264 posted 8:04 pm on Feb 16, 2006 (gmt 0)

Definitely agree. First, you are giving them free brand advertising, even if users don't click through. Second, X% of commissions don't even track so those are freebies for them. Third, you are basically assuming all the risk. If the program doesn't convert, you wasted your time and effort. For these reasons, I do feel that most affiliate programs under-pay.

jomaxx

WebmasterWorld Senior Member jomaxx us a WebmasterWorld Top Contributor of All Time 10+ Year Member



 
Msg#: 11264 posted 9:22 pm on Feb 16, 2006 (gmt 0)

It's a free market out there. If you can find a better affiliate program or make a better deal in some other way, do that instead. If you can't, then sleep peacefully knowing you've made the best deal you can. There's no point begrudging your partners the profit they make.

Sure there are some (many) bad programs, but they're just cutting their own throats. Over time every affiliate with decent traffic will take their business elsewhere.

zivkovicp

5+ Year Member



 
Msg#: 11264 posted 10:15 pm on Feb 16, 2006 (gmt 0)

I agree with Jomaxx, if there's a better deal to be had, go for it.

Bad programs will always lose good affiliates in the long run.

On a side note, you can always try promoting digital products such as guides, ebooks and software. These usually have 30-60% commissions, often times even higher... can't get much better than that.

FourDegreez

WebmasterWorld Senior Member 10+ Year Member



 
Msg#: 11264 posted 7:55 pm on Feb 17, 2006 (gmt 0)

Oh, I definitely know my good programs. And they always get top billing from me. But it takes a lot of trial and error to find them.

kassius

5+ Year Member



 
Msg#: 11264 posted 9:13 pm on Feb 17, 2006 (gmt 0)

Are affiliate programs a rip off?

No

But if you got a niche site with high traffic then you can sell your ad space on sites like adbrite and adengage then you set your own ad rates, and approve or reject every ad that's purchased for your site.

bts111

10+ Year Member



 
Msg#: 11264 posted 12:23 pm on Feb 20, 2006 (gmt 0)

Not when you go to your PO Box and it is full to the brim of cheques from merchants.

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