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Warburton
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14 Nov 2003
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136
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London
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Posted: Tue Feb 17, 2004 1:11 pm
Post subject: What's a good affiliate commission percentage?
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I have a 4% commission rate on one or two of my affiliate programs but I have no idea if that's good or bad. I heard a long time ago that any affiliate program which offered less than 15-20% commission shouldn't be given the time of day, but I have a feeling that relates to the dot-boom era and there wouldn't be very many programs today that would offer that kind of commission rate.
What do most people see as an average / good commission rate? |
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Debs
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16 Aug 2003
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4296
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NY
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Posted: Tue Feb 17, 2004 2:11 pm
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I've seen rates as low as 1-2% for computers, and as high as 60% for ebooks, software, and internet marketing products.
A lot depends on the area you are targeting ... computers and hardware are notoriously low percentage wise, but once you get the traffic, conversions may be easier than other mainstream items.
I deal a lot with lead programs, as opposed to percentage of sale ... some of the rates I've seen for mortgage applications range from $3 to $50 per lead; with some offering an additional fee if the mortgage is approved.
It's really relative to your market niche.
Debs
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robertb
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Posted: Tue Feb 17, 2004 3:10 pm
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Yea, like Debs said, it all depends on the market. I get 2% commission from TigerDirect for computer parts, but they have a performance incentive of up to 4% commission. While some magazine affiliate programs I'm part of give 30%. It depends on how much profit is to be made in the respective fields you are researching.
I would compare commission percentage, among other things, of only businesses in the same industry when selecting a program to promote.
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Blazester
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14 Feb 2004
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Posted: Tue Feb 17, 2004 8:38 pm
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The only way to compete anymore is to give your affiliates the maximum percentage you can! Affiliates are your business partner, not an unlimited resource to leech customers from. Obviously low margin, high priced items such as computer hardware will have a lower commision structure. You still have to be able to make money at the end of the day. But you have to pay a fair price for the customer you gain. Take web hosting for example, a very competitive field. If I sign up a customer for iPowWeb's $7.99 hosting (or whatever price it is now) I get paid $65!! This is because a customer who pays $8 and stays for an average of 2 years is worth it to them.
I generally don't look at offers for anything under 10% and in most cases it must be much higher. I know how valuable a first time customer is and how hard they are to acquire and if I feel I am not being fairly compensated I pass. Most big time affiliates realize this also. This is why I offer such a high payout for for my eSupportGroups program. I want affiliates who can produce and the only way to get and retain them is to offer them generous compensation.
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Charlie
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3305
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UK
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Posted: Wed Feb 18, 2004 3:26 pm
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| Blazester wrote: | | The only way to compete anymore is to give your affiliates the maximum percentage you can! |
I'd say give them the best average dollars per click you can for every typical visitor they send.
Percentages do have an emotional appeal, but most of the serious players will be looking past emotion at the cold numbers.
For example, you need to combine the sales page CR (which might not be easy to get without testing yourself) with the dollars commission being offered, but also take into account any potential for residual commissions or the tracking of lifetime customers.
For example, take Sitesell. Their percentage commissions may not be the greatest around for ebooks, but their CRs and tracking more than make up for this when you compare the final $/click for targeted traffic.
A market-penetration-priced product combined with a lifetime customers program (including more expensive products) provides a good deal for affiliates as long as quality of both products and tracking is high.
All the best,
Charlie.
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t49
Joined:
16 Dec 2003
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109
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Posted: Thu Feb 19, 2004 7:42 am
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It's like charlie says:
| Quote: | | Percentages do have an emotional appeal, but most of the serious players will be looking past emotion at the cold numbers. |
We offer a highly competitive product/service [ webhosting ],and we pay 10%,while many of our competitors offer 20-25%. However,many our affiliates are making more sales and therefore more $$$.
I must admit that some people do not buy from us because the price is too low. Some people like 'expensive' things. ... maybe we should raise our prices 
Tom
P.S.: Charlie,I like that sig line. Looked up Joseph Joubert ... one smart cookie.
one of my techies is going to find these words of wisdom on his desk in the morning:
| Quote: | | How many people make themselves abstract to appear profound. The most useful part of abstract terms are the shadows they create to hide a vacuum. Joseph Joubert |
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Charlie
Joined:
22 Aug 2003
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3305
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UK
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Posted: Thu Feb 19, 2004 12:19 pm
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Tom,
| t49 wrote: | Looked up Joseph Joubert ... one smart cookie.
one of my techies is going to find these words of wisdom on his desk in the morning:
| Quote: | | How many people make themselves abstract to appear profound. The most useful part of abstract terms are the shadows they create to hide a vacuum. Joseph Joubert |
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I hope he's had some breakfast, or that one might struggle. 
I love it though. An easy trap to fall into, no doubt. I think some people call it "job justification".
That's the beauty of "philosophy" for me... however deep you dig, you can never quite be sure whether you really "get it".
All the best,
Charlie.
P.S. How about a philosophy section of the forum? Worth thinking about, surely?
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HHW_Kevin
Joined:
13 Feb 2004
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111
Location:
Eastbourne, UK
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Posted: Thu Feb 19, 2004 3:43 pm
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I will definately have to agree with what was mentioned above - it all depends on the market you are looking at.
We offer a commission of 7% to our affiliates which is around about the most we could afford unless an affiliate is generating lots of sales. 7% or less may not sound a lot when you see what some other merchants are offering but you need to take into consideration how much of a niche market it is, and what the conversion rate will be.
For instance with our programme we sell to a very niche market and stock some UK exclusive brands so we get a higher conversion rate than say a large general clothing store who could afford to pay a higher % per sale.
Best Regards,
Kevin Ansfield
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