It’s no surprise that business within the affiliate networks industry is cut throat and if you don’t have all areas covered, you could be wiped out over night. It’s a continuing battle for networks to offer the best payouts, while keeping their margins and beating the competition. Today we are going to take a look at how an extremely popular weight loss offer is making affiliates several thousands of dollars daily, and smaller margins for the networks themselves.
The offer we will be talking about it, “Easy Weight Loss Tea”. If you haven’t run or seen this offer in the past several months, then you have been missing out big time and must not pay attention to what is going on in the industry. For those of you that don’t know.. the Easy Weight Loss Tea offer is one of the most advertised weight loss programs out there, and only costs a small $4.95 shipping fee from the consumer for the affiliate to then earn a high $36+ commission on each lead.
Since the payout on the offer is so high, it leaves a lot of potential for how it can be promoted, while still posting a profit. We will leave talking about promotion of Easy Weight Loss Tea, Acai and other weight loss offers for another time. Instead, let’s focus on the different networks hosting this offer and what they are paying out.
CX Digital $36.00
Motive Interactive $33.75
As you can see, there is only a $4 difference between the low and high public rates offered by these different networks. What I’m hearing, is that most networks are getting around $42-$44 direct on this offer… meaning if they are paying out $38 on the lead, they would make a $6 profit (if they are getting $44). While these are only the public rates, and can probably get an increase with volume… it’s still a big effect on your overall campaign if you are sending 100 leads (at public rate) to Convert2Media vs. CX Digital… roughly a $400 difference.
When I was at AdTech NY a couple weeks ago, I met up with Ruck from Convert2Media… then a few days later, I got an email from his network saying they had added “Easy Weight Loss Tea” and paying $40 a lead. This was the highest public rate I had seen on the offer yet. I thought it was really cool that they would cut their margins so tightly, so they could accommodate to their affiliates and offer more than any other network. The same applies with Ads4Dough at the $39 rate.
Everyone knows NeverBlue, ClickBooth and CX Digital are huge established companies… but the smaller networks are realizing the potential in offering affiliates higher commissions and more personal services to make them succeed. While it may only seem like a $1 or $2 difference in payout… look at it in the huge scheme of a network. If network A is paying out $40 per lead and getting $42, and network B is paying out $36 and getting the same $42 for every lead pushed through their network… that is a 5% profit margin for network A… and a 15% profit margin for B. Network A is risking a lot more and profiting less by offering their affiliates the higher payout than network B. What I’m getting at is… these networks are pushing thousands of leads day and if they pay out $500,000 a month in commissions to affiliates, they may only be making $25,000 profit.
How do you feel when you see networks promoting the same exact offers at higher and lower payouts? Also, are you taking to the time to signup for these smaller networks, over the bigger names? You may be missing out!