Do some websites run at a loss with affiliates?
 

Each day I see people saying they have not been paid. Often these are large sums of cash.

Then we see sites going bust, or simply not paying out.

Is it possible that affiliate system makes some sites run at a loss?

Many offer pay for a sale, as in 100% or almost 100% of the sale, but as these days most join for a single month, rather than re-bill, the site looses out, unless it has inside lots of upsell links to other sites.

Even on a 50/50 split, this leaves the site owner with not much cash. If they are a large sitre they may have contracts for content, large servers, and possibly staff too to pay for.

While some affiliate sales may be fine. The idea being that the affiliates get your site seen so even if they do not buy today after 5 months they may. And the bulk of sales you generate. But if a huge amount of sales are affiliated generated then logic sugests that the site will run at a loss.

I see sites offering $300 or so a sale. I fail to see how these sites can make a profit.

I would suspect we will see more sites fail simply as they have not calculated the profit and simply expected things to turn out ok in the end.

on an affiliate sale of 50%, we end up with around 7% net profit, which is of course sailing close to the wind, but that is after server, wages, models etc - if we didn't own our own studio then we'd probably be at a loss.

Been running basically affiliate free now for almost 2 years. Sure, making less sales, but making about the same money without the headaches. But yes, it makes absolutely no sense whatsoever to give 50% of the sale or in some cases higher to an affiliate. For what, just because he uploaded your content to a tube site and got a lucky hit? Enough affiliates and you start to water down your content making it basically worthless. Whats the point to joining a site when you can get all the content you could ever want from it for free surfing the various tubes etc.

No. Total lockdown, no downloading and 100% streaming only is the only option. I've noticed even the "big" boys trending toward this now.

Edit. Note, this only works on totally exclusive content, the nitchier the better... if someone wants to watch the shit, they join to see it or don't see it at all.

How long have you been in this business FFS?

Right, that's your one pointless and spastic post today. No more. That was the deal.

But those are fixed costs. Each extra affiliate sale isn't going to incur those costs again.

There's too many types of sites and business models within affiliate programs to give an exact answer. A site has to reach a certain amount of income to be in the black. That amount is different for all sites. Production/content/hosting/programming/designing/bank fees/processing/whatever costs need to be covered to payout 50% revshare or $1000 PPS.

Of course there's plenty of sites that don't operate in the black, as there are plenty that do. You see it with big sites that haven't produced new content in years. Where they are at in the business cycle is producing new content does not makes sense. They're cutting costs and coasting. Within all programs there are sites that are hits and misses.

Money doesn't fall from the sky. The payouts are based on certain sales expectations and monetizing the joins. If a site pays out an insanely high PPS consistently that means they're charging the end user accordingly. Legitimate or not.

These are ccbill sites. The affiliate costs are taken out before the webmaster (site owner) gets the check.

With nats the teptation is to spend the cash. I suspect many nats hope that affiliates do not hit the pay-out-level such as $100. There was a time many would pay out even at $10. Setting a level at $100 or so means that many small affilates will not hit that, and so the website can keep all the cas. The problem is that some do make a lot of sales.

PS.

I note the ccbill site quoted charges $34. So if the affiliate gets say $16 it leaves the website owner £16 or so. From that you have your costs.

7% of $34 is not going to make you rich unless you get a lot of sales.

The affiliate has costs too, but these are much less than the site owner.

I'd stop insinuating utter bollocks about NATS if I were you Adam.

i presumed that with nats is that the webmaster got the cash and he/she then paid the affiliate.

is that what you mean?

Am I wrong that many (if not all) set there affiliate ststem on nats to a min, often of $100?

why don't you shut up?

WTF are you babbling on about now FFS?

Wages, content, hosting etc. are fixed costs. Do you know what "fixed cost" means? Do you know anything about business at all?

Scrub that, do you know ANYTHING at all?

Here are the reasons I have seen for not paying affiliates, in most cases several will apply, we all know the money is there if you do it right, it's just that most don't:

1) Bad at accounting and don't know how to handle cash flow.
2) Drug problems.
3) Played too risky and lost a merchant account and had to switch to backup processing, meanwhile lost a lot of incoming revenue they were counting on.
4) Don't want to pay specific affiliates because of suspected fraud or disallowed promotional methods.
5) Just don't give a shit.

I am sure there are high paying PPS models where the sponsor incurs a potential loss if they fail to retain, but the programs that run them seem to have quite a bit of capital to cover the initial investment.

I'd stop doing that.

Your almost right.

Hosting can cost more if high badwidth.

And if your shooting your own content this can change from week to week.

But I was not saying the costs changed did I? Not sure why you have even made that statment.

yes

but at a certain point they run out of cash.

also one wonders what there logic is to through thousands away in this way.

Oh good grief. I give up.

If a site runs at a loss with affiliates, then they are not generating enough traffic on their own and depend solely on affiliate traffic to survive.

shut the fuck up

I feel thicker than I did 2 minutes ago :(

Traditionally you go revshare only and that way affiliates share the wealth of non-conversions, cancellations and even chargebacks along with the trials, conversions and rebills.

If you found that your value per member was high enough, through retention, upsells, cross sales and what have you, you might offer pay per signup since you knew it was worth it. In fact, you could even pay out LESS on PPS than revshare if your value per member was higher than your PPS payout. But who knows for sure unless you own the paysite and run the numbers. Thats my laymans pov anyway.

Nats and Ccbill are two different programs.
You can run Nats and still have Ccbill handle all of your affiliate payouts.

OK I will start with the obvious. Affiliates in online adult are over paid and over indulged.

A fixed cost can be 1% of the revenue and 5% of the profit. They can be 10% of revenue and 30% of profit. They are fixed they don't vary a lot. You have to fire people, get a smaller premises, buy less content, slower hosting if your profit goes down. Yes today hosting is cheap, it's still pretty well fixed. The only variable is rev share or PPS.

It doesn't stop at payments to affiliates. There's marketing to them, tools, support and everything else they ask for.

The future is bad for most of us, people are cutting costs. Affiliates are a big expense, gone are the days when their cry was "It's our way or no way.". Sponsors are starting to bring this work in house. Manwin is just one with a massive Tube.

Why should they have to do it in house, to support affiliates costs?

Please do not feed him to create another toppic. :pimp

There are probably a lot of ways to break even on it, especially if it is just a limited time offer. Most people are not going to swap links out just because a promo ended.

There is also the shave factor, you can easily pay double if you only pay for half the sales made.

Yet others may be doing dirty things on the backend and need to pay extra for the additional transactions to balance out chargeback rates.

And who knows what the value is of customer emails from people who fill out the pre-join page but not the credit card form. Obviously not as much as a sale, but they have to add up.

It really depends on whether or not your sites are known. And are they marketable to a wide audience?

Dare Dorm is... It can be marketed at just about any male from 18 to 45 with ease...

8th Street Latinas not so much...

Also do you have the ability to retain the user? In the above example Nasty Dollars retains users for years, not months or weeks. So they can comfortably payout $35 per sale or more on whales...

Sites that retain for weeks need to stick to revshare and figure out what they are doing wrong.

It depends on volume. It's a sort of economy of scale. If your fixed costs exceed your total revenue then yes you are definitely operating on a loss. Programs have certain fixed costs and if they aren't pulling in enough to cover them then they have surely reached what is called the shutdown point. A program would be foolish to offer affiliates so much that they actually take a loss for each new member added. Again that's not what is happening to most of these people. The problem is that business has died down from it's highs and they aren't doing the same volume as they used to. In spite of this their fixed costs are the same or higher. This makes them approach that dreaded shutdown point.

This is one of the advantages for a percentage based model for your backend (e.g. CCBill minus any Visa fees, etc) if you are a smaller program. It's one less fixed cost you have to worry about. If you had to pay say $1000 for your backend each month but you only did $900 in sales per month it would not make sense to keep operating.

There is at least one program owner that says he doesn't need any affiliates and affiliate system is dead. Guess who?

:2 cents: Thank you for the logical answer. Its amazing how many of these people are terrible at any business of any sort and own a paysite. Its your job to sale your paysite. Its your site. If you want more money and help getting bigger faster then you should have affiliates. If affiliates are not adding to your revenue ( theres a difference between that and profit ) you are doing it wrong.

Affiliates bring in sales you otherwise wouldn't have had. If paying an affiliate a percentage of the profit those extra sales bring in gets you in trouble then you seriously need to rethink your payout process.

In other systems the affilitate would get 5%.

think about say a site selling laptops. they are not going to pay out 50%.

Mabe websites would have been better off not paying out so much.

mabe 50% has and was way too much.

we are now used to 50%

Are you really comparing a laptop with a digital product?

Join Date: Jun 2003 and clueless about the most basic things of adult webmastering.

was thinking the same thing.

for anyone who doesnt know what they are replying to here

https://gfy.com/showthread.php?t=1061159

The level of affiliates payouts were set in far better days. Now everyone has fixed it there, it seems set in stone. Time to adapt or die, affiliates will become extinct if they can't adapt.

Illogical Captain.

So you want 50% plus all the tools to deliver traffic to the door. Which has to be supported by in house traffic generation, that has to be cheaper to pay for the high price of affiliates. Score Cash can employ people to do it ALL themselves using their tools. So that' will be the future if you continue to demand too much.

They don't.. They just shave the fuck out of you to compensate...

Easy as that. That's why cam sponsors give you 0:15,000 ratio.

Yeah, someone now who uses blackhat shit software of e-whoring will say that they have 1:200.

Also if you are the owner or manager of one of the biggest 10 adult free sites, your answer is not valid at all. I'm talking about average affiliates, not giant massive sites.

They also bring in sales you would have. If you're just cream on the top, no need to pay out 50%, plus support. If you're the major deliverer of sales, then don't just dump traffic on the tour.

What ever, it's clear the future is without the high costs of affiliates. You're lost without content. The only thing that can save you is a return to 2007. The future is the big sites getting their own traffic and you unless you're on of a very few being sidelined.

Warchild recently bragged he was doing 1000 sales a month. At $32 a sale. What is he doing that someone in an office can't do for a 1/3 of that money. Economics play the biggest part.

50% is often the minimum. now add all the new galleries, tube clips, banners, 24/7 support, hosting, ads to find them, etc. All to have the tail wag the dog? :upsidedow

I do not blame affiliates. I blame the original idiots who came up with this idea of 50%.

still clueless.

So what would you do if the alternative was not to feed your family?

Add the true costs of affiliates. Then add the fixed costs, then you can see why so many sites are finding these times tough. You were a luxury that cannot be afforded today. Best way might be to tie in with the big Tubes and do your own submitting. Instead of giving all the tools to others, have in-house staff doing it.

The one thing you have no control over is traffic. It does what it wants to and today not enough buys enough to pay for luxuries.

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What's clearly obvious hare is that many affiliates live in a cocoon made in the early 2000s. They can't force people to join, there's only so much "selling" that can be done with a mediocre product. Customers are no longer stupid and swallowing the "marketing" put out. They have smaller budgets, a lot more experience and knowledge and options today the never had prior to 2007. What ever world affiliates who think they are worth their high payouts think. The economics decide their future. Like everyone else.

Affiliates will always be around in some way as long as they have traffic. I already make more overall on average by selling my traffic or sending it to cams or dating rather than sending it to paysite sponsor programs. Do you really think I'm going to go for 20% revshare instead of 50% when I already make more by selling the traffic instead? Complete with the cross sales, signing members up to dating programs on the pre-join form via API, and the member area upsells, shaving, etc. too?

In the days where piracy rules affiliates don't even need sponsors if they want to be dishonest. All they need do is steal your content and toss it up on a tube while selling the traffic or putting up dating sponsors. I would think twice before pissing on your affiliates too much. Half of you already encourage it anyway by sucking the cocks of those who steal from you.

All they have to do is rent a server in the Netherlands and then steal your content. They never have to be without content if they are willing to do what say pornhub.com has done. That's why the industry is falling in the first place. It isn't because you are paying too much to your honest affiliates. But I sense I am just wasting my time writing this.

Yes that's happening and it is part of the changes and why very strict laws need to be introduced. Still blaming the pirates won't change the economics.

Even when the laws are introduced, the traffic will move to legit free Tubes.

You don't control traffic. It's not a tool you can use, write a script to command, manipulate or demand more of than the people who are the traffic are willing to give. And I'm sure I'm wasting my time here, still here goes.

Traffic ARE people. And they have minds of their own, cultures, experience, beliefs and economics that you have to get around to get over a message to them to sell anything. A Rolls Royce, Burger or porn.

The ultimate thing that will make the decision on your income is the ability of the product to live up to your sales message. If it doesn't you lose money. If it doesn't year after year and someone offers them a similar product for free. You lose traffic.

And if they steal my content. Your traffic goes to them.

its funny how people get that feeling when replying to paul :1orglaugh

Not wanting to put it into one post, so here goes. Probably wasting my time here, still it's worth it to show people how the real world works.

12 years of generally short changing customers worked while new ones came online with a decent credit card. Then we got hit is a short period of time by a treble whammy.

Tubes created a huge black hole if sign ups. The increase of traffic on their sties, of people with the ability to pay, was at the cost of other sites. Traffic chooses the free model because it's better for them.

Economy we have gone into hard time. Not as much of a decline as online has suffered so when the recession is over. Don't believe it will go back to the good old days. Like magazines they are gone.

Traffic from countries we can bill. It's just not like it was, new people with no experience of online porn are not coming online holding a credit card, like they used to. They come looking for the free porn and today that can get it easier than in 2005.

It took 8 years for the Internet really cripple magazines. It will take less time for it to do similar to paysites and affiliates. Some will survive, just not like they used to.

If the cost of a service out weighs it's advantages. The cost or the service has to go.

papill0n
This message is hidden because papill0n is on your ignore list.

hey paul is anyone responsible for your pathetic situation other than you ?

ironic that this incredible fountain of knowledge of yours has yielded nothing in the way of returns for you matey :pimp

papill0n
This message is hidden because papill0n is on your ignore list.

If he's posted anything but his usual childish babble, can someone quote it please.

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For a little while, people can start free forums full of pirated content, Tubes and other means to get traffic. Ultimately they're teaching the surfer to not pay for the product they rely on for their sales. Which has led us to 3/17/2012 when a free hosted tube is worth shit money selling traffic. Because the people in the business lost the plot form the beginning.

People are not stats, clicks on a banner, uniques hitting a web page. They are people. People that porn sellers need to keep happy if they want them to keep buying. And the stats, clicks, uniques are all telling you the same thing today. They are happier taking the free product rather than paying.

If you convert 1-100 surfers on a website, that's losing 99%. If you convert 1-,1,000 that's losing 0.99%. Not clicks on a banner, surfers who hit any porn site.

PRs Tube would be the tool of the century if it got 1-1,000 to buy something. Which shows you how low porn has shrunk.

Still what do I know, you guys who know so much made this all possible. :(

papill0n besides making stupid posts, what do you do for a living? Come on stand up and show us where your business is. Not on a piracy forum is it? Saw the same nick and loge there, which made me wonder.

Wow. I'm just stunned that anyone would give this asshat a straight answer.