I’m going to be an affiliate, how complicated can it be? I just need to put up a website, partner up with a few brokers, bring traffic and collect the CPAs. I’ll hire a web designer, buy some content on odesk, spread a few banners and put up a CPM campaign on Adwords. People will visit my website, click on the cool flash banners, decide to trade a little and that’s it. Easy money, right? So I quit my job, take an office and start working. It is hilariously funny when looking retrospectively.
First step is to build up the broker’s list. It’s time to choose between two models available: CPA or revenue share. The revenue share can bring more profits on the long-term while the CPA is a fast return and most important, measurable. Brokers rather close a revenue share deal as it is a win-win situation with a minimal risk for them. The CPA model is tricky for the broker as he needs to have a statistical database from which he can deduct the average trader value from a certain GEO. I chose a CPA model and after a short negotiation we’re set and ready. Actually I was pleased to acknowledge that the brokers are very flexible and generous, most of them at least.
Binary vs Forex:
Closing up a deal is highly different between the two. Affiliation seems like a chore operation for the binary brokers and the process of registering, getting approved and receiving support is swift and precise. However, forex is a bit different and it seems like affiliation isn’t natural and the process is a little slower and the revenue models aren’t vast. Some brokers don’t even offer CPA for new affiliates and trust building is needed before enabling a CPA negotiation.
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Advices from more experienced affiliates are not exactly the best incentive. Seems like affiliates and brokers have a complex relationship involving a pinch of BDSM. I just shake it off and proceed, eventually the relationship is successful and both parties have a common interest.
I remember the first time I had the idea of becoming an affiliate. I called a friend who is an affiliate manager with a gambling company and he said: “One out of ten affiliates truly succeed and take in mind that it is all about media buying.” My friend S, thank you for the advice.
It didn’t make too much sense then, but it definitely makes now when I understand a little more about buying traffic. It’s all about acquiring the right traffic at the right price. You might buy huge amounts of traffic for $1 CPM and end up spending your whole budget without any conversion and you may buy premium for $25 CPM, get high conversion rates but end up with a negative balance as the acquisition price went over the revenue. This is the CPA race. Google will eat you up for breakfast, Facebook will be great for 48 hrs and plunging into the underworld of popunders will have robots crawling up your analytics with much pleasure until the end of day calculations.
Stay tuned as next time we dig into CPL.