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recurring commissions for affiliates... which is better, lifetime? or set months?

by InternetSuccess001
6 replies
Hi,

I have a business model with recurring commissions, and want to (and am), recruiting affiliates...

I wanted to know whether you think 'lifetime' recurring commissions (i.e., as long as the customer is a client), or a 'set' time frame (i.e., maximum 3 months, max 6 months), etc, is better.

So let's say it was a $100 product that was charged monthly, and an affiliate referred a sale (let's say 50%). Let's also say the customer stays for two years (so a total of $2400 is made). Would it be better to:

(a) Say have a 'life' time commission for the affiliate, so in this case the affiliate would get 24 months * 50%, = $1200

or:

(b) Say max 3 months, so affiliate would get 50%*3 months = $150?

Reason I'm asking is obviously I know it would be beneficial to the affiliate, but would that seem 'to good to be true' (and actually 'deter' them from making sales, i.e., working to do it), whereas the max 3 months 'seems' more realistic & would attract 'harder' working affiliates?

Thanks!
#affiliates #commissions #lifetime #months #recurring #set
  • Profile picture of the author Robert M Gouge
    I'm confused, you're asking if an affiliate would prefer to only get paid for 3 months, regardless of how long a subscriber maintained membership?

    Or, are you saying you want to pay affiliates 150% on initial sales and keep 100% after 3 months has passed?

    It's been my experience that revshare programs are XX% for life of the subscription. It's what I would prefer as an affiliate.

    EDIT: Also, if you have a quality product, the strong affiliates will be able to evaluate the recurring potential on their own.
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  • Profile picture of the author Frank Donovan
    I don't think affiliates would regard lifetime commissions as too good to be true - it's fairly common practice.

    With services (such as hosting), commissions tend to last a while, whereas many other recurring commission products (especially the "big launch" ones) often have a life of only a few months, if that.

    Most experienced affiliates would be aware of this.


    Frank
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    • Profile picture of the author InternetSuccess001
      Originally Posted by Frank Donovan View Post

      I don't think affiliates would regard lifetime commissions as too good to be true - it's fairly common practice.

      With services (such as hosting), commissions tend to last a while, whereas many other recurring commission products (especially the "big launch" ones) often have a life of only a few months, if that.

      Most experienced affiliates would be aware of this.


      Frank
      Hmm, didn't think of hosting -- but can you give me a few examples of where they have 'lifetime' comissions? (I just checked out hostgator and realized they are more like CPA, i.e., $50-$125 'upfront')...

      Thanks,
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      • Profile picture of the author Frank Donovan
        Originally Posted by InternetSuccess001 View Post

        Hmm, didn't think of hosting -- but can you give me a few examples of where they have 'lifetime' comissions?
        I'm sure you'll find that with most membership programs (PLR, software etc.), it's more or less standard practice that affiliates receive commission for the lifetime of the referred customer.

        I can't think of any, offhand, that restrict it to a set period.


        Frank
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      • Profile picture of the author Robert M Gouge
        Originally Posted by InternetSuccess001 View Post

        Hmm, didn't think of hosting -- but can you give me a few examples of where they have 'lifetime' comissions? (I just checked out hostgator and realized they are more like CPA, i.e., $50-$125 'upfront')...

        Thanks,
        I think it's worth mentioning that a big player like hostgator probably allowed lifetime recurring at one point and switched to 'upfront' commissions only (just speculating obviously).

        If the product is solid and the retention rate is supposed to be high, from a vendor standpoint, you'll make way more offering upfront payments rather than recurring. However, your smarter affiliates will realize this, but if the conversion rates are good, they won't really care.
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  • Profile picture of the author website12
    Banned
    I would do both you can have per month and have a life time membership it would get the people who just want to try
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