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  1. #1
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    $100,000 commission check BEFORE making a sale?
    Consider this scenario...

    A big name merchant approaches you because you own a website with pretty decent traffic. The merchant offers to pay your commission upfront for sales you haven't made yet.

    For example, your commission is 10%. They offer to mail you a $100,000 check upfront for you to generate $1 million in sales. The only requirement for you to get paid upfront is this: you must promote the merchant with a huge horizontal banner at the top of your homepage every single day until you generate the $1 million in sales - however long it takes.

    1) Would you accept an offer like this?

    2) What things would you consider before making a decision?

    The main thing that I would consider is this: if the merchant does not have strong conversions, they will take up valuable space on the homepage for a long time until the sales are made.

    Your thoughts.

    Brandon

  2. #2
    Beachy Bill's Avatar
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    1) Would you accept an offer like this?
    Oh, man, I'd jump on that in a heartbeat.

    2) What things would you consider before making a decision?
    How much I'd had to drink.
    Bill / Marketing Blog @ 12PM - Current project: Resurrecting my "baby" at South Baltimore..
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  3. #3
    ABW Ambassador kse's Avatar
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    It depends would $100,000 be high percentage if the income your site earns in the next 5 years???

    If yes then ask them for a copy of the terms of the contact and get a good lawyer to look at it for you.

    If no then tell them you take no money up front and ask for a 20% commission rate in return and no contact (so you can pull down the banner if it does not convert)
    MERCHANTS: Start showing your coupons directly on your site, that way your shoppers will stop leaving your site looking for them!! If not then remove your Coupon Box!!

  4. #4
    OPM and Moderator Chuck Hamrick's Avatar
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    Take the money then start work on an alternative site.

  5. #5
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    Is this the New Jersey Trash Disposal Company and the guy making you the offer "you can't refuse" named Vito? I'd probably turn 180 and run as fast as I could.

    Also, why would any creditable company think a banner is going to convert? Wouldn't they give you the freedom to make those sales in a more effective way?

  6. #6
    The "other" left wing davidh's Avatar
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    I once took up an offer like this (though nor for such an outlandish sum) from a CPM company. I would not (and did not) have any trouble reaching the number of impressions that they were asking for. But in the end they came along with bogus claims of far fewer impressions than were actually served; they owed me more but claimed that I owed them more. So I pulled their ads. Let them try to sue me for the fifty bucks; the day in court would be like a day off for me lol.
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  7. #7
    Affiliate Manager
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    The "however long it takes" part would make me nervous. What exactly is your commitment to them in exchange for that $100k - just a banner on your website forever? I have a hard time believing anyone reputable would just throw $100k at a site for a non-specified time frame for the ROI and not have some sort of "fine print" payback clause. I would definitely regard any offer like that with a lot of skepticism...and probably not do a thing without consulting an attorney.

  8. #8
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    Quote Originally Posted by calebtheredwood View Post
    Is this the New Jersey Trash Disposal Company and the guy making you the offer "you can't refuse" named Vito?
    No.

    Quote Originally Posted by calebtheredwood View Post
    Also, why would any creditable company think a banner is going to convert? Wouldn't they give you the freedom to make those sales in a more effective way?
    Let me ask you a question. If you were a merchant and you decided to offer a popular site upfront money for sales, would you give them the freedom to promote your company in any way they wanted while you sit around and wait for your return? Or would you want everything laid out regarding how your company is going to be promoted?
    Last edited by successfirst; July 24th, 2014 at 02:16 PM.

  9. #9
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    To those that asked why a homepage banner... those banners are pretty effective on the homepage of certain sites such as coupon sites. If you go to the homepage of Coupon Cabin or RetailMeNot... those banners at the top promoting a merchant grab your attention before anything else. They are very effective.

    And yes, we are talking about a coupon site here. Those huge banners on coupon sites can really drive sales. Now banners on news sites, magazine sites, and other content sites? Well the value of those banners are a different story.
    Last edited by successfirst; July 24th, 2014 at 02:18 PM.

  10. #10
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    Quote Originally Posted by Melanie View Post
    The "however long it takes" part would make me nervous. What exactly is your commitment to them in exchange for that $100k - just a banner on your website forever?
    Yes that is the commitment, including changing the offer in the banner periodically.

    Quote Originally Posted by Melanie View Post
    I have a hard time believing anyone reputable would just throw $100k at a site for a non-specified time frame for the ROI and not have some sort of "fine print" payback clause.
    Their thinking is this: if the time frame for the ROI is long, they just secured a ton of impressions and brand recognition for the products being promoted - for a one time cost of $100,000.
    Last edited by successfirst; July 24th, 2014 at 02:19 PM.

  11. #11
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    Quote Originally Posted by davidh View Post
    I once took up an offer like this (though nor for such an outlandish sum) from a CPM company. I would not (and did not) have any trouble reaching the number of impressions that they were asking for. But in the end they came along with bogus claims of far fewer impressions than were actually served; they owed me more but claimed that I owed them more. So I pulled their ads. Let them try to sue me for the fifty bucks; the day in court would be like a day off for me lol.
    What were the terms of your agreement? Was there a time frame to deliver the impressions? Refund policy? Could you promote their ad anywhere on your site?

  12. #12
    The "other" left wing davidh's Avatar
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    Up-front money was offered as an incentive to run their ads instead of somebody else's, and they would pay monthly thereafter for however number of impressions were delivered in the previous month; pretty much the standard arrangement. But they would lie about the number of impressions served. Their modus operandi was to get ads placed and get ten times their money's worth before they get ditched; I later found that they had been pulling this routine on publishers for several years.
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  13. #13
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    Quote Originally Posted by davidh View Post
    Up-front money was offered as an incentive to run their ads instead of somebody else's, and they would pay monthly thereafter for however number of impressions were delivered in the previous month; pretty much the standard arrangement. But they would lie about the number of impressions served. Their modus operandi was to get ads placed and get ten times their money's worth before they get ditched; I later found that they had been pulling this routine on publishers for several years.
    Would you mind PMing me the name of this company? Always good to know companies to avoid.

  14. #14
    ABW Ambassador isellstuff's Avatar
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    Things to consider...

    Are you going to get affiliate commissions from the merchant as well?
    Are they going to use a reliable 3rd party tracking mechanism that you can trust?
    Is their presence going to cost you more than $100K in lost commissions by diverting visitors?
    Do you get see the creatives prior to making the deal? Don't want flashy seizure inducing banners on your quality website.
    Merchants, any data you provide to Google Shopping should also be in your affiliate network datafeed. More data means more sales!


  15. #15
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    Quote Originally Posted by isellstuff View Post
    Things to consider...

    Are you going to get affiliate commissions from the merchant as well?
    Are they going to use a reliable 3rd party tracking mechanism that you can trust?
    Is their presence going to cost you more than $100K in lost commissions by diverting visitors?
    Do you get see the creatives prior to making the deal? Don't want flashy seizure inducing banners on your quality website.
    Good points to consider. Potential lost commissions by diverting visitors is a very significant point to consider.

  16. #16
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    Do you have a banner now at the same location. If you do you may be able estimate how long it will take you to generate the 100k. How about making your own deals with multiple merchants for a better rate for the given placement. You may be able get to 100k sooner without the burden of an open ended forever deal.

    If it was me I would be scared to make such a forever deal.

  17. #17
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    Quote Originally Posted by sam_park View Post
    Do you have a banner now at the same location. If you do you may be able estimate how long it will take you to generate the 100k. How about making your own deals with multiple merchants for a better rate for the given placement. You may be able get to 100k sooner without the burden of an open ended forever deal.

    If it was me I would be scared to make such a forever deal.
    Melanie above mentioned a ROI time limit and payback clause. If you were given a time limit (e.g. one year) with an agreement to pay back any unearned commissions at year end, would you still be scared?

  18. #18
    ...and a Pirate's heart. Convergence's Avatar
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    Now it's getting convoluted.

    Here's what I would tell the merchant:

    Here's our rate card...
    Salty kisses, Sandy toes, and a Pirate's heart...

  19. #19
    Outsourced Program Manager John Jupp's Avatar
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    Some coupon sites charge $800 a day for a banner on their Carousel. That's $292,000 a year (times four as they advertise one merchant and three internal categories, or up to four merchants at peak times of year). So $100,000 is only worth 125 days exposure on popular sites.
    Flambi Media Limited - USA/UK/EU Affiliate Management Expertise

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  21. #20
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    Quote Originally Posted by successfirst View Post
    Melanie above mentioned a ROI time limit and payback clause. If you were given a time limit (e.g. one year) with an agreement to pay back any unearned commissions at year end, would you still be scared?
    Why would you bother getting into such an agreement where you sign a contract, take the money, keep track of the earnins via a third-party tool just to return the unearned money at the end of the year? Hundred different things can go wrong. Why not just negotiate a better rate with a few of your proven merchants and earn the money to keep it?

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