percentages - 8:20 am on Jul 18, 2004 (gmt 0)

>Can you elaborate on this idea. Is the 'performance figure' sales data from an e-commerce site, increased site traffic, anecdotal data?

One Example: In the US, Doctors, Dentists, Attorney's or even Real Estate agents and others will happily pay a 20% to 35% referral fee for new business.

To these folks 20% to 35% of sales, which is also close to net GP related to a single sale is an acceptable figure. They already pay that for traditional advertising or referrals.

Ever been to a Doctor and been referred and referred and referred....same true of a Dentist?, Attorney? Real Estate Agent or several other businesses?

It is because they all make good money with very limited liability from these referrals.

You get pushed from pillar to post because there is more profit in the referral than from the liability of doing the job.

Website designers and those related to advertising can cash in/join in on this environment.

I know a "sale" to a Doctor has at least a 35% profit margin.....ain't that a horrible thought, but it is only a reflection of how they think!

Therefore a Doctor will be prepared to pay his website developer a 35% equivalent fee for any business his website developer truly generates.....after all that is only the same as the Doctor is already paying for business now via other mechanisms (advertising or referrals).

Therefore if you use your negotiating skills to charge based upon something between 10% and 35% of sales they will be very happy, and if you can deliver, it will most likely be a far higher payment than you can achieve via conventional methods.

This only works if you can deliver the goods, and have a water tight contract that ensures they pay. But, let's be honest without these two elements you probably shouldn't be in this business anyway ;)