Pricing Structure for an Affiliate Network

In need of help, defining a pricing structure for an affiliate network

[tomld2]

I am in the process of releasing my own affiliate network. It will work on a similar basis as the big boys (CJ, Linkshare, etc). The software will allow webmasters to run their own affiliate program (per sale, per click, per lead, and per impression), recruit affiliates from their own branded signup form, or tap into the networks database of affiliates. Affiliates will be able to join and browse the various affiliate programs based on categories.

The idea is to make this as cheap as possible. Obviously it will be 100% free to affiliates. My original idea was to make it 100% free for merchants, but unfortunately that is economically impossible. There will be associated fees such as percentages of commission balances taken by the merchant account company, our fees to cutting & mailing monthly checks to affiliates, and server fees.

So my revised plan is to offer to merchant options. #1: A basic account which will have no monthly or access fees. #2: A premium account which will cost $20 a month and the merchant will have their program emailed to all network affiliates upon joining and top spot in our network affiliate program categories, as well as being featured on our homepage.

That still leaves the question about the percentage of commission fees. What are your thoughts? 5%? 10%?

The idea of creating this affiliate network is to provide a solution for the small to medium sized company, who can not afford the $10,000 Linkshare access fee or the 30% commission fees.

Your opinions on a pricing structure are very much appreciated!

Thanks,
Tom

[hopeful]

i am considering using an affiliate program to help market my website(sell product)
i was thinking of signing up to something like cj rather than doing it myself, as i reckoned other websites would be more trusting of such an intermediary

then i was going to go round suitable webistes and ask if they wanted to sell my product through the third party affiliate program

i was going to give them 15% of sale price, no ppc only get money if customer buys from me

also to prevent being ripped off (affiliates buying and then returning product from me), putting in an exclusion which means they dont get teh money if teh customer returns the goods under the two week guarantee scheme

does what i am proposing make sense?

[danieljean]

The big boys' fees seem really outrageous to me too. Yours however seem a bit too low.

Have you taken a look at Shareasale's pricing? That seems reasonnable- any less than that and I wonder how you would afford advertising.

Honestly, I think there's so much potential for abuse with a network that I'd like to see it organized as a merchants' co-op.

Either way, good luck!