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  1. #1
    Affiliate Manager deannab's Avatar
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    July 30th, 2010
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    Arrow Ideal Commission Structure - Rev Share, CPL, Hybrid?
    Which structure do you think would attract the most partners?

    Background: We're B2B and we qualify raw leads. The qualification (which would be the "sale") usually happens the same day as the conversion and can take 3 days max. Average revenue per qualified lead is $400. Average qualification (ie. sale) rate ranges from 10-30%.

    For 100 leads, average of 20 would qualify, for average revenue of $8000.

    - 25% revenue share ($2000 on average)
    - $10 CPL ($1000 guaranteed)
    - $5 CPL + 10% revenue share ($500 guaranteed + $1000 average)

    Right now all of our partners are at the 25% level, but I've heard some feedback that bigger networks might prefer CPL or a hybrid. I look forward to your feedback!

    Thanks,
    Deanna

  2. #2
    Moderator MichaelColey's Avatar
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    January 18th, 2005
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    The best model is the one that aligns the affiliate's interest (commissions) with your own. Leads can be very problematic when it comes to fraud. If you pay a $10 CPL, you're going to find that you get hundereds or perhaps even thousands of affiliates who generate a lot of leads, but whose leads don't convert into sales.

    I would highly suggest a pure revenue share, if it's possible. That most closely aligns interests.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

  3. #3
    Affiliate Manager deannab's Avatar
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    July 30th, 2010
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    Thanks, Michael. I would prefer the straight revenue share (and that's what we do now), I'm just thinking of ways to possibly attract larger partners. Great point though, I definitely don't want tons of bad leads!

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