The Power of Residual Commissions
[This is the third article in a series of three describing some
of the special types of affiliate programs now available. Please
visit the Strategies & Tips section
for the previous articles which discussed pay-per-lead
programs and two-tier commission
programs.]
In the past we have looked
at the special advantages that pay-per-lead and two-tier commission programs have over
many of the more standard programs. This issue we look at a third type of special
opportunity: affiliate programs that offer residual commissions.
Residual commissions can defined as any commission you receive each
and every month for sales you previously made, as long as the person
you referred remains a customer. An example of this would be the
AWebers Autoresponder
program. If you refer a visitor who purchases one of their autoresponder
services, you not only receive an up front commission for the initial
sale, but also a residual monthly commission for as long as that
person remains a paying customer.
The advantages of residual
commission programs is that you can reap the benefits of your referral for an extended
period of time. Perhaps for months, or even years, you will continue to receive a
commission. Obviously, these residual commissions could really add up over time. Even
better, as your base of sales also grows, your monthly residual will continue to increase.
And the best thing about residual commissions is that it is income you can practically
rely on, since you will continue to earn as long as they remain a customer.
So, how can these programs offer
residual commissions to you? Mainly because most, if not all, residual programs are
selling services for which they charge a monthly rate. Similar to your Internet access
charges, the customer receives a monthly bill for their service. And you are paid a
percentage of this monthly fee. This represents the only major disadvantage residual
programs really have. Since the type of services involved are not one-time purchases, and
since this generally makes it a larger decision for the customer, these programs do often
experience lower conversion rates than programs that rely on one-time, spontaneous sales.
However, unlike most pay-per-sale
programs, with a residual program you do not have to worry about losing future business.
If you refer a customer, you can be assured of receiving commissions from them each month.
By comparison, with standard programs such as Amazon and CDNow, there is what I call a
leaching effect. You refer the customer, and make that initial commission on their
purchase. But after this, the customer bookmarks the home page of the merchant, and is
solicited with direct offers by email, neither of which will help you earn a repeat
commission, unless they are thoughtful enough to remember your site and use your link to
purchase.
So, if you are interested in adding a residual income program to
your site, be sure to visit the Residual
Commission program category in the Affiliate Programs section.
Several of the programs reviewed have also made it to the ClickQuick
Top Rated Programs listing including
Virtualis
and AWebers
Autoresponders (both of which also offer two-tiered commission
structures - a great combination).
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