Take CPA! No, no, go for a revenue share! Hmm, if I were you, I would choose a hybrid deal! If you’ve just entered the world of affiliate marketing and feel a bit uncomfortable hearing phrases you don’t understand then you’ve come across an article tailored to suit your needs. The question is how to choose among several options if you don’t know what any of them mean. To help you straighten up this semantic mess, here are the most important info about these affiliate payment models followed by pros and cons for each of them.
CPA - Cost Per Acquisition
CPA, also known as Cost Per Acquisition or Cost Per Action, is an advertising pricing model in which affiliates receive a commission for every player they send to an affiliate program. It sounds easy, doesn’t’ it? That’s because it actually is, but there’s more to it than meets the eye.
Usually, a player needs to sign up and make a deposit before becoming a ‘qualified lead’ or whichever term is used to denote what a customer should do upon registration. This type of deals often includes requirements such as minimum deposit amount, specific time frame within which the deposit has to be made and to be a frequent user who plays a certain number of games.
The CPA payment plan could be the best option for new affiliate programs for the three following reasons:
- You don’t need to generate purchases
- You don’t need to build your own website
- You’ll get the highest possible revenues
On the other hand, the inconvenient characteristic of CPA is that it requires a lot of learning and tweaking before you can get control over things. Plus, there’s a chance that you’ll be fighting for your spot under the sun against the existing high-traffic websites which have a starting edge over you.
Often referred to as Revshare, this payment structure is the one where you as an affiliate are paid a percentage of sales, profits, or losses for the lifetime of a player. Although it’s quite clear that this model carries a large potential, the crucial part is how active your leads will be. In other words, if you have a large number of players on revenue share model, but they play rarely, then your affiliate commission will probably not skyrocket.
Revenue share is undoubtedly the most popular payment model for experienced affiliates, since it introduces the possibility of a continuous income. As long as your players constantly pay the money, and your affiliate partner fairly shares the profit, the revenue share plan makes sense and brings money on a regular basis.
However, you should always pay attention to whether an affiliate program has a negative carryover or not, because if it does, that means that a single winning player might wipe out an entire affiliate’s program commission for a very long time.
The above sentence says it all. Hybrid deals are a combination of two previous plans – CPA and revshare. They offer features from both worlds whereby each component usually pays lower compared to their original standard offers. And while hybrid programs can be good for less experienced affiliates, the truth is that if they strive to become exclusive online casino affiliate programs one day, they should have in mind that most hybrid plans come with limited time offers.
The final question on the table is how can you pick the right payment option? The answer is not a generic one and it depends on matters such as your goal, what are you trying to achieve, are you aiming for a short or long-term deal, who is your target audience and how active you’re planning to be. Whatever you choose, do it wisely and while you’re there, check our website regularly for more info on the topic of affiliate iGaming market!