One of the issues that has been bothering me since I started out as an affiliate has been “why do affiliate and CPA networks pay out such miserable recurring payouts for sub-affiliates”?

If you’ve checked into an affiliate or CPA network control panel, you’ll typically see a “Super Affiliate” or “sub-affiliate recruitment” link with payouts ranging from about 1% to 2% of commissions generated and if you’re lucky, you’ll sometimes see 5% or 10%.

At those levels, is there any real incentive to go out and recruit affiliates/publishers for your network, aside from wanting to build goodwill and possibly a couple of bucks for a nice Friday night dinner?

I understand that margins can be pretty thin, especially since a number of CPA networks are the ultimate traffic arbitragers – they “buy” traffic from you at $1-$1.50 per zip/email submit lead, and attempt to upsell them into an affiliate offer or merchant-direct offer on the backend.

Granted, I haven’t seen the financials of one of these networks yet, but I’m wondering that if you are already relying on affiliates to generate your sales…why not go the extra mile and incentivize them to go out and recruit more affiliates for you? Especially with a decent payout. (we’re not even considering networks which pay you $3 or $5 to recruit an affiliate…).

By my estimations, one out of every 100 affiliates is a top performer (hence the term “top performer”), in this league, you’ll see guys like: Amit Mehta, Ralph “Ruck” Ruckman, Zac Johnson, Bobby “bluebobbo”, Jeremy Palmer, James Martell , Paul “Uber Affiliate” Bourque among others.

But I think the game of getting top affiliates is like going out on a fishing boat. You cast your nets and get a whole bunch of prospective affiliates, but you won’t know who’ll be a top performer until you haul in your catch and sort everyone out.

On that basis, the less-skilled affiliates will weed themselves out and a higher payout won’t matter anyway. On the other hand, a better performing affiliate will be motivated to go out and get results.

I think the bottomline is Continue reading →