View Poll Results: Do/would you work with cost-per-acquisition merchants?

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  • Yes

    7 70.00%
  • No

    2 20.00%
  • Neither, and I have something else to say [please post]

    1 10.00%
Results 1 to 14 of 14
  1. #1
    AM Navigator Geno Prussakov's Avatar
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    Do You Work With Cost-per-Acquisition Merchants?
    ...not your basic CPA (cost-per-action/lead) model, but where you are paid only if a lead is valid, the customer is genuinely interested, and an installation, sale or service is provided to him/her.

    Thanks.

    Geno

    PS: If you do not yet work with any such merchants, under what condition would you? Full transparency, contract, access to their back-end CRM database, anything else?

  2. #2
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by Geno Prussakov
    ...an installation, sale or service is provided to him/her.
    Isn't that a sale? I would want a commission on a deal that lead to an installation/sale/service.

    Isn't CPA a flat fee?
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  3. #3
    AM Navigator Geno Prussakov's Avatar
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    It essentially is (a sale), yes. I am just talking more of an installation/service type of sale (not your regular product sale). Longer to validate, but larger commissions.

    Geno

  4. #4
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    Need too much trust to go for that kind of deal, and trust is a commodity that can sometimes be in short supply.

  5. #5
    ABW Ambassador simcat's Avatar
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    I generally avoid these kind of merchants, but 2 of my best performers are this type.

  6. #6
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by Geno Prussakov
    ...not your basic CPA (cost-per-action/lead) model, but where you are paid only if a lead is valid, the customer is genuinely interested, and an installation, sale or service is provided to him/her.
    Geno, this model is not a true cost-per-lead because of the required stipulation:
    "and an installation, sale or service is provided to him/her."
    A true cost-per-lead would be $1 or whatever the set amount was per contact generated from an affiliate web page.

    I was once a timeshare salesperson (in person at the resort, I actually met people and took them on a "tour" etc... everything was leading to my pitch/offer).

    Handsome, preppy young men in their early twenties were marketers called "OPC"s (Off Property Contacts) and would actually find and convince couples to come on a fun tour and meet sales people like myself with the promise of a free lunch or dinner gift certificate to a nice restaurant or a few lesser offers such as a camera (customers were eligible for their chosen gift at the end of the tour).
    I know that OPCs were paid $50 for every couple that walked through our sign-up facility, gave their full names, addresses, telephone numbers, and actually took the tour of our resort.
    The couples (OPCs did not target single people) did not have to buy timesharing in order for the OPCs to be paid. In other words, the couples did not have to make a serious commitment; all they did was provide their names which would go into a database.
    Those guys were paid $50 per couple.
    I was not paid unless the couple paid for a timeshare package (a selection with various terms and prices was available to fit people's vacation lifestyles & budgets).

    An affiliate of a CPA model is similar to the OPCs.
    If your company gets a contact for the company's database, that contact information is worth something because there was a reason that prompted the customer to fill out that data.

    I know that installations/services such as installing kitchen cabinets, rug cleaning, drapery cleaning, [whatever] would take time for the customer to actually go through with the entire deal.
    Telling the affiliate that he/she won't make anything unless the deal is a full down and completed one will turn off some affiliates.
    The CPA merchant should at least promise a low amount [depending on the potential worth of the deal] such as $5 or $1 or whatever the amount is for the contact information that the affiliate is able to pull in. A contact from an affiliate page would be worth more to your company than a contact randomly chosen from a telephone book.
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  7. #7
    Believe knight01's Avatar
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    Quote Originally Posted by Geno Prussakov
    It essentially is (a sale), yes. I am just talking more of an installation/service type of sale (not your regular product sale). Longer to validate, but larger commissions.

    Geno
    I do this with a satellite TV merchant. Very tough and competitive business. As such, I know the leads I send have to be good and they have to convert. If they do, honestly many do not, I am paid exceptionally well.

    The main reason a business like this doesn't pay on a per lead basis is to avoid the 'crap' leads that are to easily generated. The cost to the merchant to contact and qualify the lead would be excessive with a large amount of bad leads.
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  8. #8
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by knight01
    The main reason a business like this doesn't pay on a per lead basis is to avoid the 'crap' leads that are to easily generated.
    Is the lead validated only through sales?
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  9. #9
    Believe knight01's Avatar
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    Quote Originally Posted by Rhia7
    Is the lead validated only through sales?
    Generally, yes. It does require a great deal of trust on the side of the affiliate. It makes for a true partnership. I make money only when the merchant makes money, the merchant makes money when I make money, because I send more leads. It really isn't much different from sending someone to an ecommerce site to make a purchase. Just takes much longer for the transaction to take place.
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  10. #10
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by knight01
    It really isn't much different from sending someone to an ecommerce site to make a purchase. Just takes much longer for the transaction to take place.
    Okay, it's a delayed deal then.
    I'm used to people clicking my link, buying something, and then I receive an instant credit for the sale.

    I was wondering what was/is the difference between a "sales click" and a "cost-per-lead" if the latter depended upon a sale. knight01, you offered some light on the topic, thanks.
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  11. #11
    What's the word? Rhia7's Avatar
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    I think a small remuneration is needed up front to attract affiliates and then if the deal goes through the affiliate can be awarded the "commission" or whatever term you use in this type of business.
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  12. #12
    ABW Ambassador simcat's Avatar
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    Merchants can pay a nominal commission on leads with credit card details supplied. The card info might be stolen, so the merchant might have a 30 day delay on payment. Time for the original card owner to be alerted of theft, or unnatural patterns to show.

    A large % of the leads I supply turn into sales (paying 5-10x as much). I suppose the merchant might be able to cheat me, but if the $ stops coming, the promotion stops too...

  13. #13
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    Not CPA
    Geno,

    I wouldn't call this CPA - CPA is generally equated with zip submits, ringtones, payday loans and all the other offers run by networks like Azoogle, NeverBlue, Hydra, just to name a few.

    This is traditional CPS with a longer time to approval/commission.

    As I've discussed with you privately, there needs to be a tremendous amount of trust and transparency between the marketing partner/affiliate and the Merchant - if something is denied, you need to know why, you need to be able to call your merchant up on the phone etc.

    Also, a lot of these things tend to be done over the phone so dedicated numbers are essential for high volume.

    cheers

  14. #14
    AM Navigator Geno Prussakov's Avatar
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    oziman, Rhia,

    I don't think I called it "CPA".

    In fact in the very first post I wrote:

    ...not your basic CPA (cost-per-action/lead) model, but...
    Other than this, everyone's reply is extremely helpful.

    And yes, oziman, you can say that it is more of a "CPS with a longer time to approval/commission".

    Thank you.

    Geno

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