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  1. #1
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    Smile Commission Payouts? Recurring or Lump Sums
    I run a successful web hosting company that has recently started looking more into Affiliate Marketing. Finding this site was like a God send! The major questions that I have is simple, would you prefer a Lump Sum (such as 100%), or a recurring commission (such as 10%)?

    Any input is greatly appreciated!

  2. #2
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    With hosting the norm is a lump sum. I would recommend you research what your competition is paying out, that is how you will find out what you need to pay out to be competitive.
    Deborah Carney
    TeamLoxly.com BookGoodies.com ABCsPlus.com

  3. #3
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    Quote Originally Posted by loxly View Post
    With hosting the norm is a lump sum. I would recommend you research what your competition is paying out, that is how you will find out what you need to pay out to be competitive.
    Some of our competitors are paying out such ridicules lump sums it would be almost impossible for us to compete. Right now we are still a small company. This is what I was thinking of marketing my affiliate program differently, with recurring payments.

    Do you think it could be successful? I appreciate your response!

  4. #4
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    You have to be able to pay out what your competition does to attract affiliates. You can do it differently, but you have to convince affiliates why they should promote you and get less money upfront than they get from the other programs.
    Deborah Carney
    TeamLoxly.com BookGoodies.com ABCsPlus.com

  5. #5
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    Quote Originally Posted by loxly View Post
    You have to be able to pay out what your competition does to attract affiliates. You can do it differently, but you have to convince affiliates why they should promote you and get less money upfront than they get from the other programs.
    That is what I was thinking! Thanks for all the great advise!

  6. #6
    ABW Ambassador kaizen's Avatar
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    Actually paying your affiliates when they make a sale would set you apart from most hosting companies.

    I think that while many prefer the big payment up front, there are also many who appreciate the recurring/residual approach, IF you are a good enough host to keep your customers for the long term.
    We did not change as we grew older; we just became more clearly ourselves.
    ~Lynn Hall

  7. #7
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    Quote Originally Posted by kaizen View Post
    Actually paying your affiliates when they make a sale would set you apart from most hosting companies.

    I think that while many prefer the big payment up front, there are also many who appreciate the recurring/residual approach, IF you are a good enough host to keep your customers for the long term.
    So far we have a 94%n retention rate. We do plan on actually paying our affiliates, so hopefully that will set us apart! I think there could be an interest in recurring payments, since it would be almost impossible to keep up with the big names such as HostGator at this point. How do you think the affiliates would want to be paid, so far we just offer payment through paypal, but we were thinking about offering checks as well. What's your input? Loxly?

  8. #8
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    All you can do is try. Affiliates need to build up trust in your company. Affiliates do love recurring, but that takes some work on your part to implement. I have a merchant (Raven Internet Marketing Tools) that offers a bigger payment on first month, then recurring payments ongoing for the life of the account. Affiliates like it very much, but this is a pretty unique program.
    Deborah Carney
    TeamLoxly.com BookGoodies.com ABCsPlus.com

  9. #9
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    Quote Originally Posted by loxly View Post
    All you can do is try. Affiliates need to build up trust in your company. Affiliates do love recurring, but that takes some work on your part to implement. I have a merchant (Raven Internet Marketing Tools) that offers a bigger payment on first month, then recurring payments ongoing for the life of the account. Affiliates like it very much, but this is a pretty unique program.
    Awesome! Right now the program that I am using to track affiliates does not allow for large sum + recurring, but I did a quick poll to my current customer base and they said they would prefer Recurring, that majority at least.

    Now, how many creatives do you recommend offering for each major size and do you like affiliate merchants that offer Flash banners as well as static?

  10. #10
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    Http://abestweb.com/bestpractices

    Lots of info in the threads there about what to do and how to get started.
    Deborah Carney
    TeamLoxly.com BookGoodies.com ABCsPlus.com

  11. #11
    OPM and Moderator Chuck Hamrick's Avatar
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    TBradley, I ran a domain/hosting affiliate program for over three years for a long standing registrar. We offered Life Time Value (LTV) commissions for three levels of annual hosting packages. That was a compromise for them refusing to pay ongoing commissions for renewals or offering a white label solution like GoDaddy. I can tell you that Haiko would have been interested in replacing his domain/hosting white label program that ran on a sub domain here if the merchant would offer the equivalent. IMHO you can start with an LTV program but you will never be a real player without a white label and reoccurring commission program. At least that is what the big hosting affiliates told me.

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