Highest Network Affiliate Referral Commission?

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Affiliace.com

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Sep 26, 2007
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Quick Question:

We are looking to offer affiliates an ultra-stupendous commssion rate to refer other affiliates on a '% of lifetime earnings' basis.

So, what are the referral commissions you have seen from other 'repuatble networks'?

We are currently at 5% (lifetime commissions), but I feel we need to reward further!

Cheers.
 


Thing is the highest ref commissions is going to be the lowest payout to affiliates. Do the math.

You get lets say 38 on a diet offer.

That means if the person has a ref at 6% it's $2.28 to the ref where at 2% it's .76 cents. So network B can pay their affiliates a $1.50 more per lead and if you have high volume affiliates they're going to bounce for the 1.50.

The fallacy that ref commissions don't effect payouts it wrong. They obviously do. So then that leads us back to shaving. I'd be careful with high ref commission networks personally.

At our network for example with diet our max payout is 35$, if someone has a ref it's 33.50 but we're very up front about all this stuff. Just put all pieces together before you make decisions.

Just my 3 cents.
 
Thing is the highest ref commissions is going to be the lowest payout to affiliates. Do the math.

You get lets say 38 on a diet offer.

That means if the person has a ref at 6% it's $2.28 to the ref where at 2% it's .76 cents. So network B can pay their affiliates a $1.50 more per lead and if you have high volume affiliates they're going to bounce for the 1.50.

The fallacy that ref commissions don't effect payouts it wrong. They obviously do. So then that leads us back to shaving. I'd be careful with high ref commission networks personally.

At our network for example with diet our max payout is 35$, if someone has a ref it's 33.50 but we're very up front about all this stuff. Just put all pieces together before you make decisions.

Just my 3 cents.

Very well said. You cant offer the highest payouts and a high referral commission unless you are doing something shady.
 
Jason and Mike, i figured this for years, I don't have much evidence but have had affiliates tell me they feel companies that offer big rewards and referral commission do something shady like shave the leads to make up for it.. I don't doubt this at all. I say all this and we just launched our 5.50% lifetime referral program and 1-2% cash back rewards program. We did the maximum we could without eating into affiliates earnings. We are trying hard to promote our network and thought this would help, this costs us money to do but will never cost our affiliates anything, i have no doubt if networks offer much more than what we do they must be doing something shady because at 5.50% we are taking a swift kick to the balls.

I don't think we will always offer a 5.50% referral, it's just too costly. But we offer it now, and will grandfather in anyone who joins. We have no plan to change it up on those who sign up at that rate, we consider it a marketing cost Motive would never shave, or fuck over our pubs - our program is legit and those of you who know us know we just are not the shady types.
 
Very well said. You cant offer the highest payouts and a high referral commission unless you are doing something shady.

Hi Mike,

Actually, I disagree with that completely. That's a little like saying that supermarkets must be 'doing something shady' if they are selling at cost price.

Sometimes, there are other benefits of this to a network other than maximising profit per lead/sale.

I guess it all depends on your business strategy.
 
I'm more worried about getting paid out on time. The referral system is great for getting some extra promotion, and even with networks with high %s and maybe lower payouts, I'd much rather work with them than someone that will shave all my leads at the end of the day with higher payouts and lower ref.
 
Hi Mike,

Actually, I disagree with that completely. That's a little like saying that supermarkets must be 'doing something shady' if they are selling at cost price.

Sometimes, there are other benefits of this to a network other than maximising profit per lead/sale.

I guess it all depends on your business strategy.

Hi,

You have correctly said that some affiliate are very genuinely paying handsomely. Thats all depends of the marketing tactics adopted and the competition in the market.

Regards
 
Hi Mike,

Actually, I disagree with that completely. That's a little like saying that supermarkets must be 'doing something shady' if they are selling at cost price.

Sometimes, there are other benefits of this to a network other than maximising profit per lead/sale.

I guess it all depends on your business strategy.

supermarkets offer loss leaders because people buy more than one item in a supermarket, and they can gauge them on the other items to make up for the loss on the one. Unfortunately that doesn't work well in the AM space since most affiliates run one offer, or if being offered a lower payout on the second offer they just go to another network to run it instead.

You cant offer big referral commission and big payouts, economically it doesnt work. I pay affiliates close to 90% of what we get, if i added a 5% referral fee, affiliate manager commissions, office rent, and technology costs i would be negative. A well run network with accurate pixel tracking cannot afford to pay a high commission rate and high payouts unless the support staff and overhead is small

i am not saying anyone in this thread or outside this thread is doing anything shady, but the numbers only work out when you pull something out of the equation (i.e. scrub, play with the pixel to get more misfires, remove the referral ID, cut expenses (i.e. payouts, employees,etc.)

This is just my opinion from being on the network side.
 
I am with Smaxor and Mike on this one. I used to send a lot of traffic to an offer and I am sure I could have gotten a higher payout, had I not been carrying someones 4% referral commission.

I wonder if referral commissions are really worth the headache for networks with the admin costs and payouts payout margins. I guess it does bring in new affiliates, but so do higher payouts. And affiliates who sign up with a network because of higher payouts are probably more experienced and have higher revenue potential than noobs signing up through affiliate blog links.

Of course, it's also possible that I have no idea what I'm talking about....
 
A well run network with accurate pixel

that was my point, i do think some networks are doing something shady.

In the case of Motive - we very honestly are as you say at a negative. our referral program is included in our marketing cost so we are spending money (loosing money) to build the network and eventually make more :) we don't take away from affiliates that would wash out our efforts.

I pay affiliates close to 90% of what we get, if i added a 5% referral fee, affiliate manager commissions, office rent, and technology costs i would be negative. A well run network with accurate pixel tracking cannot afford to pay a high commission rate and high payouts unless the support staff and overhead is small
 
As a young growing network it is Important to define goals and to build the business there are tools such as buying traffic in blogs, doing trade shows, and yes giving back to affiliates even to the point that it cost the network money - all part of growth. So can i say that motive will always have a 5.50% referral? No, it's probably not going to be forever, but we will not take it away from those who join now and shaving and other shady practices just have never been part of our plan. So back to the goals I mention. My goal as a manager of a business is to build a loyal clients base, provide a value added service, create a rewarding work environment for my employees, do something I'm personally proud of, make my own decisions, and make lots of money - in that order. My goals and the goals of my company may be different from other networks and i suspect they are. There are a lot of networks and affiliate marketers out there who's goals is 1. to make as much money as possible any way they can. I understand the desire to make a ton of money,nothing wrong with that but at the expense of your affiliates, clients or customers? Tread carefully with networks who seem to have that persona. Get rich quick, make millions, take a look at the founders histories look at who they work with. When you look at the networks who do shave and screw over pubs they tend to have managers who are no strangers to shadiness. So bottom line look close at the network if they offer you a huge referral payout and huge prices, of course be cautious but first take a look at who runs the business and what there goals are - you can usually tell pretty quick the difference between the cream and the crap. I know i got off course, but i thought this turned into a good thread and i wanted to participate as much as possible.. Have a great weekend!
 
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