When are you people going to learn, contest are scamming money from affiliates.

maybe so... who knows. I know personally i see it more of a slap in the face then a reward. I would rather it go into their accounts, like i said i would rather them smoke it, blow it at the casino then give it to one of my competitors that got 5 sales last month. If they going to give more money away, it should be to the people who make them the most money. Results should equal income not luck.

Honestly, I could care the fuck less what these people do I am not telling them how to spend their money. This is how i feel about it, and I am trying to get a guage on how others feel about this topic. My theory is that affiliates who actually send a decent amount of signups (whales or lil whales) would prefer more money in their pocket opposed to more lotto tickets in their pocket.

I think they are more focused on getting new affiliates instead of putting that time/energy/money into taking care of the ones they have, period. IMO.....

Thanks to everyone for contributing to this thread.

Well, that's certainly true of several programs. Agree with you on that portion

Will76, you have to see both sides of the coin. The example you give is for program 'maintenance' it doesn't allow for much growth. Paying people a small % more & not doing any promotions will, if you're lucky, keep you at a comfortable plateau BUT the moment a whale sells his site, decides to test another sponsor or leaves you all together for one reason or another, your forecasts are no longer good/your budget is affected and you've just put your company in jeopardy. Also, when people continue to promote the same sites, the same way and they become comfortable with it - it stops innovation even on the Affiliate side so maintaining the same sales you got comfortable with will also become a struggle.

Having more money to spend (as you say, burn) on promotion doesn't necessarily come from 'affiliates' doing better. Managing your costs better - cutting on other forms of promotion & rearranging your budget wiser will allow the allocation of funds for GROWTH which in turn will allow you to give perks *every once in awhile* in order to give back to your affiliates. Then it becomes a cycle - earn, save, invest, grow

Your point doesn't make much sense though. You're saying companies shouldn't spend money on advertising, but should instead spend it all on raising affiliate payouts. Maybe you fail to understand the importance of advertising in business? I don't know.

Whales do make programs, but all the little fish add up. Every affiliate benefits from the expansion and continuing success of a program. You should understand how an increase in affiliates helps you as a whale. I don't really care to explain it. But it's common sense. And that's exactly what contests do. They bring in more affiliates.

I'll think i'll call it "affordable gambling"

I invest a small amount of time to win some little money and get a chance to the jackpot.

contests do work if for any reason they get people who let them fall the the bottom of the page to push them back to the top. traffic changes all the time so maybe that site you dismissed from company X who converted 1:5k six months ago does 1:50 for you when the contest comes around. win or lose, are you going to push it back to the bottom when alls said and done? probably not. that and maybe the people who havent gotten around to adding the links to their site. maybe a hummer will get you to move them to the top of the list and win or lose you might enjoy the ratios. i do agree however that a 60k prize for one winner is stupid. maybe ten 6k prizes would achieve the same result and the chances of 100% noobs winning will diminish.

"Scam" is definitely the wrong choice of word, but I go along with someone who wrote a few posts back that he is put off by sponsors who (regularly) offer big prizes.

The reason being that it's dumb.

Affiliates come in all sizes, from the brand new startup through to the guy capable of delivering thousands of surfers a day. From around the middle of the field on up are experienced webmasters who know how to raise traffic and convert it. And they have tuned their operations to work successfully with certain sponsors.

Even if any of the more productive affiliates are willing to switch some of their traffic to chase a prize, presumably they will switch it again once the competition is over to chase another prize. There will be exceptions, but I'm damn sure that any more than short-term affiliates that these competitions generate are almost all minnows.

Nothing wrong with that as such, some of those minnows may turn into useful affiliates over time. But is it the best use of the money? No. Just the easiest and least imaginative. Surely it would make more sense, instead of relying on luck that a competition will produce some productive long-term affiliate signups, for the money to be spent in ways much more likely to produce that outcome?

For example, instead of a $40K car, why not multiple prizes of scripts, tutoring/consultancy, design, traffic, etc. Why competitions at all, why not (easy-to-reach) targets which automatically trigger qualification for this or that productivity-related benefit?

Because right now the whole way of handling affiliates is a lot like those companies which hide behind PO Box numbers and advertise commission-only sales jobs: here's your sales kit, good luck. Which was okay when newbies were flooding into the market and a high percentage of them would make money. But that flow is slowing and will slow further still and far fewer newcomers are succeeding these days. These competitions have to be producing diminishing returns and yet still, I cannot think of a single sponsor who has a serious program for building affiliate value.

I think I just won something. Cool.

Well here's one then, does this question apply?

As an affiliate company do you want the majority of your joins coming from a ton of small affiliates, or a handful of whales? (And don't say a combination of both )

They really come from the whales anyway fuzebox.. Kinda much the same as any real-life biz where 5% do biz worthwhile and 95% do little, but consume over 95% of support resources.

PS.. Tho there can be some worthwhile folks in that 95% who do grow!

I think paying a little more and generating word of mouth that you are a good paying sponsor that isn't into hype and shit but wants to give back as much as you can directly to the people who are making you the money is 100X more powerful then contest.

opposed to spending 60K on an affiliate that gets you 5 signups and switchs to another program next week.

not sure what this has to do with my argument of more money vs chances in contesnt.

give back to your affiliates ?????? don't you mean give back to ONE lucky SOB ?

I said CONTEST. NOt advertising. It is one thing to spend 60K on an ad, It is another to give it to my competitor who sent 1 signup but give me $0 who sent you 1000 signups. It's a shitty business model. Find more innovative ways to generate interest in your program that doesn't say "shit on you" to your bigger affiliates when Joe Noob wins a 60K prize for doing nothing, BUt i have been with you for 6 years and you tell me " better luck next time" wtf ?

FOR a totally different thread but i think it is better to give webmaster refferals and not advertise at all. Let the webmasters make the money, you pay them for telling their friends, that is bound to be a more successful affiliate then you paying GFY and someone signing up out of the blue because of your add. Thats another thread for another day. Keep the money where it counts, with the people making you money.... sure way to succeed.... hmm tempted to do this just to prove a point.

If they spent that $60k there or on board advertising, it's the same.

the point is to boost the affiliate base, and it definitly works.

100x new small affiliates or 5 big ones don't make much of a difference.

The point of contests is advertising... they just give it back to a random webmaster instead of webmaster sites owners.

good post... definetly better ways to spend the money.

Doesn't really apply but i will answer the question with my opinion.

1 whale would equal 100 small affiliates.(basically)

So for simplicity, yes i would rather 10 affiliates vs 1000 for the same amount of sales at the end of the day. And my focus would be on retaining them, giving them every penny i could squeez out to keep them happy, along with the tools the need, etc. Showing them that they matter the most to me, not telling then sorry you didnt win, better luck next time.

Jayeff is easily one of the smartest guys in the biz.

If you guys could have seen some of his SEO posts on AVS Lounge some years ago you would be awestruck.

A contest is a form of advertising. The whole point of promotional offers is to attract more consumers to your product/brand. You as an affiliate don't get a say in how a company chooses to promote and advertise their program.

I'm not trying to be an asshole, but you wouldn't expect an affiliate program to say, "Hey you should only be sending us traffic. You could be making us more money if you sent us all your traffic!"

They don't tell you what to do with your traffic, why should you get a say in how they handle their advertising budget? You want to take advantage of the PPS model that pays you a flat rate even if your leads don't ever convert to profit for the company, but you wanna complain because you think their advertising budget should be used to pay you more? I honestly don't see where you're coming from man.

It's an advertising method. Not a scam in any way, shape, or form.

This is the stupidest argument i've read on GFY in ages.

That 60 thousand dollar expense brings in affiliates. It's not like they're trading 60 thousand dollars for some guy who got lucky with the 5 joins he sent. They're trading it for the hundreds of affiliates they'll pick up for running the contest. A company does a contest to give away a 60 thousand dollar vehicle and pretty much any webmaster who reads the boards will know about it. That's a huge reach to their target market.

Now, if they spent that money skinning GFY or buying adspace on Xbiz to generate the same number of new affiliates, then how is it any different? Are existing affiliates getting screwed 'cause money they could be earning is being spent on advertising to recruit other affiliates?

It's the exact same thing. The thing is, the hummer prize is probably more effective than adspace that nobody bothers to look at any more.

I am really suprised that this has to be explained . . but don't you want to attract whales? $60k Hummers help do that.

Spreading that $60k over $12,000 $5 bonuses isn't going to attract many whales, and I doubt the extra $25 is going to make much of a difference to the little guy. He would much rather have a shot at the brass ring.

For someone starting something (affiliate-related, yes?) you need to brush up on Business 101. Contests are a type of "loss leader" that generate buzz -> increase branding -> improve image -> more affiliate signups. Some of those new affiliates are likely to generate new revenue.

You have some valid points, but there's only so much "word of mouth" can do.
As for retaining affiliates, I'm sure no one is likely to walk away because the company is offering a big prize - if anything, an incentive to send more traffic or at least stay active.

As for the company you advertise for, from my experience they pay a flat $ that doesn't fluctuate (i.e. I don't ever remember a bonus period, etc.). Meanwhile, their competitors are offering almost non-stop promotions to help lure new affiliates and keep "old" ones active.

To me, the smart business sense is push your program, contests, promotions, word-of-mouth, trade shows, etc. etc. A combination that keeps your program in the minds (and eyes) of affiliates everywhere.

Lastly, "reducing the amount they pay you" (by having contests) doesn't wash from my experience. Take PussyCash - who you referred to sideways in your original post - they gave away 2 Hummers AND have a $70 PPS promo going. ALL affiliates are eligible for the $70 promo. "Your" program does neither.

So net, net: If you were sending sales to Company X (no promos, contests) you were making a *base* of $40 PPS, period. If you sent to Company Y ($70 PPS *base*, Hummer Contest), you were making $30 more AND had a chance - albeit a small one - at winning a $40K ride.

I don't understand how this would make any affiliate feel slighted? Except perhaps those pushing Company X...

You're off base its about signing up more people and bringing more attention to your program

I understand the basic point you're trying to make however I think you fail to realize that some of these programs take care of their larger affiliates no matter what. The contests and prizes are just an advertising expense to attract new affiliates. As has been discussed, its the same concept as sponsoring an industry party or skinning a board.

PussyCash for example not only gave out a Hummer that every affiliate could win (simple math says that if you had a large number of joins your % chance of winning is higher than an affiliate sending a join) but also gave out a seperate Hummer that only one of the top 10 affiliates could win. Not only that but each of the top 10 affiliates received $1k extra. On top of that,they take care of their higher producing affiliates every day of the year.

I only reference Pussycash as I work with them. Im sure other programs handle their larger affiliates in a similar manner.

perfect answer