Launching a PPS - How to

[Dzinerbear]

Hey all,

I was talking to a straight company yesterday about trading some traffic. He said, "Okay great, why don't I join your program, what are you payouts?" After he stopped laughing, he said, "I can't do that, everything in my exit console is earning me $30 a sale."

So my question is multi levelled. How do you figure out if you can afford to run a PPS?

How do you figure out you can only pay $30 PPS instead of $35?

Is PPS here to stay?

Are webmasters not interested in collecting rebillings any more? They just want to get in and get out with their $30?

Don't you make more money over the longterm if you pump good programs with good rebilling commissions?

Does PPS generally apply to everything, even $1.95 trials?

Thanks
Dzinerebar

[Daymare]

I'm not an expert in PPS other than sending traffic to them, but if you can figure out your earnings per member well enough, and you have the cash reserves, PPS could be the way to go. If you payout $30 per member, and your members stay 3+ months on average, you're laughing. But you have to remember that PPS programs have scammers, cross sales, exit consoles, etcetera to make up for the costs since a lot of them have horrible sites. So if you factor in the costs of adding your own software to track sales, a billing dept for sending out payments, affiliate fraud, and so forth and you are still making a good profit, then go for it. Other than that, stay with % revshare and try to generate the traffic yourself than via. trades.

[basschick]

pps was there before revshare. a lot more people seem to promote pps.

and it's like Daymare said - if you are earning enough per member, you can do it.

[Lee]

Good question and to be honest, its going to depend on what the companies business model will be when it comes to whether they go for quantity or quality of sites.

When companies go for quantity of sites, they can pretty much figure out that they need to make X amount of sales from their console chain to pay X amount of affiliates X amount of dollars per sale then, they take into account upsells and the likes inside the members areas as well as, in some cases, cross sells on the join pages themselves.

However, when they go for quality of sites, paying out a $30 or $35 per sale on a site that converts AND retains members actually makes the affiliate program more long term revenues, even if a member stays for 3 months @ 29.99 per month for example, that works out to 89.97 in revenue (not including upsells or processing fees) of which 35 gets paid to an affiliate leaving a 3 month profit of 54.97.

Now take into account the amount of additional traffic that affiliates will send to a program utilizing the PPS business model and that should give you some idea of how QUALITY sites make the program money.

Basically, if you have even 3 months of sales stats you should be able to work out how much you are paying out of pocket (hosting, content, etc), how much you are making and, ultimately, how much you pay out the affiliate at the end of each sale.

Also, dont forget that many programs now offer BOTH revshare and PPS business models, this will mean that the revshare affiliates will also be growing the pot to pay out the PPS affiliates somewhat also

Regards,

Lee