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:: Three Types Of Affiliate Programs ::
There are 3 major types of affiliate programs offered: Pay per sale, Pay per click and Pay per lead programs.
Below you will read about information on each type as well as the pros and cons of joining such affiliate programs.
1. Pay Per Sale Affiliate Programs
2. Pay Per Click Affiliate Programs
3. Pay Per Lead Affiliate Programs
1. Pay Per Sale Affiliate Programs
Pay per sale, or commission based programs are by far the most common type of affiliate program
available today. These affiliate programs pay a specific percentage of the total product cost
that a customer pays. You will get paid a commission only when that customer comes from
your site.
Some Pay per sale affiliate programs will offer incentives. For example, if you are an affiliate
sending huge numbers of customers the incentive may be higher commissions per sale. Most affiliate
programs, however, will pay a flat commission regardless of number of sales you make. Beware of
affiliate programs that cap monthly earnings. Always read the fine print of an affiliate agreement
before joining an affiliate program!
Pros of Pay Per Sale Affiliate Programs
-
Very well selected pay per sale affiliate programs that relate to your site can not only add content
to your site, but add a nice residual monthly income as well. Make sure that the affiliate products you
choose relate very closely to your site, that way you are more likely to make a sale.
Cons of Pay Per Sale Affiliate Programs
-
You'll find that it will take many visitors to your site before you make any sales. In other words, if
you only get a 1% conversion rate, it will take you 100 visitors before anyone will click on your affiliate
link! And if only 10% of those who click on your affiliate link buy anything it will take you 1000 visitors
to make a sale!
There are ways to improve this scenario. One way, which I briefly discussed above, is to choose affiliate
programs that are very specific to your website. That way, when you receive a visitor, they will be
very targetted and more likely to click on your affiliate link and buy something.
Example: If you own a site about cats, you should find affiliate programs that are specific to cats.
Such as cat food, kitty toys, or cat care. You'd be far more likely to make sales than if you linked to general
affiliate programs such as animal food, animal toys or animal care.
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2. Pay Per Click Affiliate Programs
Pay per click affiliate programs, or click-through programs, are the second most popular affiliate program.
They pay you a small amount for each visitor you send to their site. Usually the commission ranges from
$0.01 to $0.25 per visitor.
Some pay per click affiliate programs will even pay you more if the visitor you send them visits more than
one page on their site. Again, read the fine print of the affiliate agreement so that you make sure you know
what you are getting into and how the pay structure works.
Pros of Pay Per Click Affiliate Programs
-
You get paid for every single visitor you send to their site. This is different than pay per sale affiliate
programs in that you do not have to make a sale to get paid!
- It doesn't take much effort to put up a text link or banner to the target site to make money.
- Many pay per click affiliate programs provide detailed real-time statistics on how many visitors you've
sent them so that you can calculate how much you've made in commissions.
Cons of Pay Per Click Affiliate Programs
-
Your revenue can accrue very slowly! Unless you have thousands and thousands of visitors every month
it is unlikly that you commissions will add up very fast. If your site does not receive many visitors you would
be better off offering high quality products that you can get paid on a per sale commission basis.
- You never reach the minimum earnings threshold. What I mean by this is that many affiliate programs will
require that you earn a set amount, say $25, before they will even send you a check! So, for example, if an affiliate
program pays you $0.02 for every visitor you send them, it will take 1250 click-throughs to their site before you
even receive a check from them! I would recommend that you only take part in pay per click affiliate programs
if your site receives tens of thousands of visitors a month, otherwise it's just not worth it!
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3. Pay Per Lead Affiliate Programs
Pay per lead affiliate programs are much less popular than commission based programs, but they still
do exist. Pay per lead affiliate programs will pay you only once for sending a visitor to their
site who buy something or perform a task (like fill out a survey).
Businesses who offer pay per lead affiliate programs are hoping that you send them visitors who sign up
for a newsletter, fill out a survey, or request a free product of theirs. You are essentially sending them
traffic that they hope they can follow up on and capitalize on.
Pros of Pay Per Lead Affiliate Programs
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It is easier to make money with a lead affiliate program! Why? Because all the visitor you send them has
to do is sign up for something free or fill out some information. That's right, they do not need to purchase
anything for you to make a commission, thus it is more likely to happen!
- You can make more per customer you send them just because they do not have to purchase anyting. So, in this
respect, a pay per lead program may bring you more commissions per customer than a traditional commission affiliate
program would.
- Based on the number of visitors who are clicking through to your affiliate link you can calculate very easyily how
much you will make in commissions based on certain actions your visitor performs.
Cons of Pay Per Click Affiliate Programs
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This program may seem good, but what if your affiliate program only pays you $100 every time you send them a visitor
who buys a house? Let's say they buy a $200,000 house. Well, that works out to only a 0.05% commission! You'd be much
better off finding an affiliate program that would pay you 5% or even 15% for sending someone to their site!
- You always have to find new customers for pay per lead affiliate programs! The truth is that you will
only be paid ONCE for each new customer you send to your affiliate program. That means you need to continuously send
new visitors there to make any more money! This is not too daunting a task if your site brings in a couple thousand visitors
per day, but if you have a small site it may be harder to make really good money.
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