Forum Moderators: skibum
Can anyone see any flaws in this model.
Assumption:
I have two affiliates A and B
I get 100 clicks in from affiliate A per month and 900 from affiliate B per month.
I make $1000 net in sales.
The 1000 affiliate clicks accounts for 25% of my net external traffic.
I pay 20% commission on sales.
Therefore:
Affiliates contributed $250 of the sales figure and so should get $50 commission.
Result:
Pay Affiliate A $5 and Affiliate B $45 (i.e ratio 9:1)
Main flaw may be that the site doing the most work (nine times as much traffic) is being paid at the same rate despite the fact that he may be a far better affiliate.
I can then tweak the above by saying that (after a probationary period and consequently establishing trust levels) increases in traffic will be rewarded by a rise in commission rates to say 25% or some other such benefit.
Another objection may be that some sites may just click their way to commission? That's why I included the probationary period.
I also tweak this model by creating a "super-affiliate" category: A new category 'super-affiliate' enables more synergetic partnerships; Super-affiliates are in addition rewarded at the higher level of $xx per sale. To qualify as a super-affiliate, in addition to high traffic, there will be closely alligned promotions, targeted marketing efforts and long-range strategic planning between the two sites.
I think this model would be easily workable for me. Would it be attractive?
Mark McCarthy
Not to me. The basic flaw is that you're discounting click quality. Affiliate A might send you only 100 visitors, but they might be highly targeted; Affiliate B might send 900 scattershot visitors. Affiliate A can actually account for most of your sales.
People want to be paid for the work they put into something. If they feel they have no control over the outcome they will never send you quality clicks. My very strong feeling is that I would never sign up for a program in which I cannot precisely track my site's performance to the penny.
There are a lot of good ways to track affiliate performance. I'm sure some of the folks from the other side of the equation will be along soon to recommend some.
Jim
From an affiliate's standpoint its completely a nonstarter. Give it up.
zooloo
I want to avoid cookies but run my own program.
Very few serious affiliate marketers will play ball with a program which does not track via cookies, and from the affiliate's perspective, the longer the cookie the better.
Offer commissions on a pay per action or pay per sale basis. Clicks don't mean a thing if they don't convert. Pay per click is an invitation for abuse, and you'll spend a ridiculous amount of time managing the abusive accounts.
The other ideas you put forth are quite sound. Tiered commissions and bonuses for high performers are a very good idea.
