Affiliate Program Business Models
When looking for the affiliate program that will best suit your needs, you must understand that there are various styles of affiliate programs. The different Affiliate Business Models include Pay Per Sale, Pay Per Lead, Pay Per Click, Single Tier, Double Tier, and Multi Tier. Here is a short breakdown of each of these.
Commission Based Affiliate Programs will pay you a certain percentage per sale that you generate. These are generally good if you know the sales you will generate involve more than just one item. The more you sell, the more you make.
Flat-Feed Affiliate, or Cost Per Acquisition (CPA), Programs set a certain amount per sale or per lead. These are generally good for you if you know you will generate a lot of leads. Leads do not have to be actual sales, but instead, the visitor fills out their name and email address, or a multi-page survey.
Pay Per Click programs are good if you know that your website generates a lot of visitors and you know they will click the ads. Affiliate Programs like this will generally pay you an average of .15 to .25 per click.
Single-tier affiliate programs are the most straight forward type of tier for affiliate programs. For the most part, these programs will reward you for your sales, but will not pay you for “signing up other affiliates”. The harder you work, the better your results will be, no matter how much other affiliates are making.
Two-tier affiliate programs will pay their affiliates in two different ways. You are paid for your individual sales, and also, you are paid for additional affiliate signups. Normally these programs will pay you a flat fee for each extra affiliate that you get to sign up. They can also pay you commission on the amount of money the affiliate signed up under you makes (example: The affiliate program pays affiliates 25% per sale, and you make 5% of that 20% that the affiliate under you makes).
Multi-tier affiliate programs are generally related to pyramid schemes, but they work like this: You sign up Justin, Justin signs up Veronica, and Veronica Signs up Angela. Now, you will get a percentage of Justin’s, Veronica’s and Angela’s sales. If you know that the affiliates you sign up are productive, and they will also sign up other productive affiliates, this will be your best bet for an affiliate model. The only thing we would suggest with this type of affiliate program is to read the fine print and make sure you are not signing up for a pyramid scheme because you will not want to waste your time with those.
Casino, poker and bingo affiliate programs generally work on a CPA or commission basis - or a mixture of the two, called a hybrid. As an online bingo affiliate, you could expect up to 40% commission on every player you refer to an online bingo site. The same goes for casino and poker affiliate programs. If you were looking at a straight CPA deal, then you could expect up to £40 CPA while hybrid bingo and casino deals are around 25% commission and £20 CPA.