will76

One debate people often get into is trying to figure out if they should take the pay per signup or if they should do the 50/50 split. Thats kinda what I am debating here but I want to take it one step further.....

Free sites with pay per FREE sign ups vs. Pay Sites and 50/50 splits.

(Someone convince me why it makes sense for people to run their own paysite, please.)

I've owned and opperated monthly membership sites from 99 - 03. Did pretty well, a few of them grossed more then 150K a year. I reluctantly placed sponsors on my sites in 01 and got good results, gradually switched over to a Free site and became an affiliate advertising 100% for other programs. Ive opperated free sites since 01 and exclusively from 03.

Pro's of opperating your own pay site.
- Rebilling
- Rebilling
- Rebilling
- Affiliates
( anything else?)

When I made the switch from membership sites to free sites I noticed the following....

- I was getting 4x as many FREE signups (free signup, w/credit card), then I was getting to my monthly membership sites ($29.95) with the same amount of traffic.

- I was netting a lot more money. The average charge for my paysites where $30 a month, I kept about $25 after processing fees. The industry average for rebilling is 3 months or less. So lets say 3 months, the one signup made $75. However my free sites signups were making me $40+ a sign up and I was getting 4 of them for every 1 pay. So $40 x 4 = $160 generated from free and $75 generated from pay.

- I spent more time advertising and not on my members area. Membership sites require a lot of time if you run them right. Lot's of customer support e-mails, tech questions, billing questions, etc... Also had to update the members area a few times a week. I had to either be the model who supplied the content physically, or i had to shoot it, or i had to go out and buy it. Either way i spent time or money or both to do it. All of this time added up to about 20+ hours a week. When I switched to free sites I had 20 more hours to advertise, which made me even more money.

- bandwidth fees and content cost for members area. Was spending over 2K a month on content just for members area.

So Free sites require less time to opperate, cost a lot less money, and make you a lot more!

So why are there still people out there that opperate their own membership sites. OR people who choose the 50/50 split with another company they are advertising for.

Rebills ?
Hey rebills are great. I had some people who rebilled for 3+ years, got to love making $1,000 off of one signup. But that rarely happend. The average at best was still 3 months.

Some problems with rebills, for both the people who do the 50/50 splits and those who opperate their own sites, you get deducted for charge backs, and charge backs are lot more common on rebilling memberships at 34.95 then they are from FREE Sites LOL. So you lose even more of the money you think you made that month, and all that bandwidth was wasted from the members who chargeback.

Biggest problem with rebills is losing them. I've lost thousands with DMR/WEB900 back in 99 and I am going to lose about 50K+ with ibill now, from rebills from old sites. Great if you get 1000 or more rebills but sucks when you lose your merchant account or the 3rd party processor shuts down. For those of you doing the 50/50 split, the same things apply. Why trust that company with your money long term. What happens if you have 1,000 rebilling members and they close shop or go bankrupt. your screwed. And it happens a lot.

There is affiliates, and thats a plus for those of you who run your own membership sites. But now you are giving up 50% (or more if you want to try to compete with the big boys), so what do you really make per an affilate signup ??? You are lucky to NET what $5 profit after all your expenses from a $30 membership, and now you have to spend more time supporting the affiliate, more time providing materials to them for them to advertise, etc... So unless you have 100's of affiliates that sending in a lot of signups then you are not going to make that much from them anyway. Very Very Very few individual owned monthly membership sites will ever make a lot of money from their affiliates. And then there is still that problem of losing your merchant account or the third party processor going under, and now you just dont lose your money but you lose thousands of dollars of your affiliates money, and you have a lot of pissed off webmasters threatening to kill you, lol.

So, someone explain to me why they wouldnt want to advertise a Free site for a free signup program that pays them $40+ a free signup instead of running their own website or doing a 50/50 split with someone ?

I know there are thousands of you out there doing this, so please explain to me WHY!?!?!

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ICQ: 86364801 Email: will [at] innovativeassets [dot] com