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  1. #1
    More Cheesier Than Ever Cheesehead's Avatar
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    Two Tiers - A Thing of the Past?
    Are two tier affiliate programs still a good way to make money? I remember 5+ years back they were all the rage.
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  2. #2
    Newbie shopping-incognito's Avatar
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    I hope not...this is one of the benefits I hope to implement into my affiliate program.

  3. #3
    Crazy Cat Lady Heidi's Avatar
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    I still make some money via 2 tier referrals but I don't actively promote people joining me anymore as I used to.
    Heidi
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  4. #4
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    Back in 1997-1999, I earned significant amounts from "referral tier" activity. I had referred other web publishers to various programs (mostly web hosting and CPC ad networks) and I was paid the second-tier compensation -- very rarely third-tier.

    Those days are over. Two-tier programs rarely generate any earnings for the "referral tier," and multi-tier programs now exist almost exclusively in the murky area of MLM (multi-level marketing) schemes. Some of the most nefarious "affiliate program" failures (such as AllAdvantage.com and Spree.com) involved multi-tier programs that made absurd claims.

    Indeed, any time I see an affiliate program that even mentions "two-tier" or "multi-tier," I either stop looking at the program, or more rarely I will immediately start looking for other signs that the program is actually an MLM scheme or a scam.

  5. #5
    Beachy Bill's Avatar
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    Quote Originally Posted by markwelch
    Back in 1997-1999, I earned significant amounts from "referral tier" activity. I had referred other web publishers to various programs (mostly web hosting and CPC ad networks) and I was paid the second-tier compensation -- very rarely third-tier.

    Those days are over. Two-tier programs rarely generate any earnings for the "referral tier," and multi-tier programs now exist almost exclusively in the murky area of MLM (multi-level marketing) schemes. Some of the most nefarious "affiliate program" failures (such as AllAdvantage.com and Spree.com) involved multi-tier programs that made absurd claims.

    Indeed, any time I see an affiliate program that even mentions "two-tier" or "multi-tier," I either stop looking at the program, or more rarely I will immediately start looking for other signs that the program is actually an MLM scheme or a scam.
    +1

    You may find a number of novice affiliates being impressed by the offers of a multi-tier program - they don't yet know any better. However, most serious affiliates will look elsewhere. I am by no means a "super affiliate" but today I would not ever consider a two tier or three tier program.

    I never could understand why some affiliates would want to purposely increase their own competition. That is the net result of tiered programs.

    I would also be very apprehensive about any new program today that starts out without being part of a recognized network. There far too many scams online today. Seeing that a new program has been (at least minimally) vetted by an established network generates at least a modicum of trust.
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  6. #6
    Analytics Dude Kevin's Avatar
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    Not to mention, if there's additional room for commission under a margin, I would prefer to see it go to me as opposed to the affiliate that referred me to the program
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  7. #7
    The "other" left wing davidh's Avatar
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    there's additional room for commission under a margin
    For a merchant, there's additional room for profit if it's not split with an affiliate.

    why some affiliates would want to purposely increase their own competition
    And why would a merchant want to "purposely increase their own competition"? For extended reach. That's what a second-tier commission structure - a "sub-affiliate" - offers to an affiliate... extended reach.
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  8. #8
    More Cheesier Than Ever Cheesehead's Avatar
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    Thanks for the input. I guess ultimately, without sales occurring, multi-tier programs result in zero earnings and only serve to bring in competition. The exception would be shady MLM programs paying commissions on ridiculously priced start-up kits or required purchases. But in a true affiliate program, no such "start up" purchases are needed.
    This World is Not My Home
    We're gonna go inside, we're gonna go outside, inside and outside. . . And then we're gonna go go go and we're not gonna stop til we get across that goalline! Quotes from the movie Rudy, 1993

  9. #9
    Kung Fu Master Eathan's Avatar
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    Quote Originally Posted by Bill
    I never could understand why some affiliates would want to purposely increase their own competition. That is the net result of tiered programs.
    The affiliates who promote programs aren't always the same affiliates who market products. It's a different mindset, more about longer term residuals.

    You can sell a product one time and earn a commission, or you can sell a program one time and potentially earn commissions for years. They're smaller commissions, but potentially more of them.

    I've always liked second tier programs, but it's true that good ones have become few and far between.
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  10. #10
    More Cheesier Than Ever Cheesehead's Avatar
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    Quote Originally Posted by Eathan
    The affiliates who promote programs aren't always the same affiliates who market products. It's a different mindset, more about longer term residuals.

    You can sell a product one time and earn a commission, or you can sell a program one time and potentially earn commissions for years. They're smaller commissions, but potentially more of them.

    I've always liked second tier programs, but it's true that good ones have become few and far between.
    So it sounds like the proper way to run this is to focus on only two levels. The top level person focuses on finding people that want to sell the product and then helps them to sell if they can. And there it stops. That makes sense to me.

    Contrast that to the multi-tier programs (common in MLM) that sell the idea of selling the two-tier concept to never-ending new levels. This explains why MLM often has some sort of Join Fee or overpriced startup package in the mix. Without it, there would be virtually no sales at all if the product itself is overpriced.

    At any rate, I now have a much better idea of how a two-tier might work for what I have in mind.
    Last edited by Cheesehead; January 6th, 2010 at 09:58 AM.
    This World is Not My Home
    We're gonna go inside, we're gonna go outside, inside and outside. . . And then we're gonna go go go and we're not gonna stop til we get across that goalline! Quotes from the movie Rudy, 1993

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