WebMoney - Program types

1. Click-Through Programs
Essentially a glorified form of banner advertising, click-through programs pay you a small amount for every unique visitor you send to the target site. Typically you can earn between $0.01 and $0.2 per visitor

Advantages:
You get paid for every single visitor you send to the target site, not just for the much smaller number of visitors who actually buy something.

Most click-through programs provide detailed real-time statistics so that you can keep track of your earnings very easily.

You don't need to make a big effort to set up your site to take advantage of such a program: just add a banner or text link to the target site and you're in business...

Disadvantages:
Many programs cap the click-through ratio
Many click-through programs limit the maximum payout you can receive based on the ratio of the number of banners you display against the number of people who click through those banners. This can be very bad for your potential income if you have an extremely relevant, targeted site.

A practical example: a program with a click-through ratio cap of 5% and a payment of $0.05 per click-through would limit your earnings to a maximum of $2.50 per 1,000 banners that you display, no matter how many people actually click through those banners. While a click-through of 5% may be much higher than most sites will achieve, it seems foolish to limit your earning potential artificially.

Advice: always read the small print of the Affiliate Agreement very carefully, since this kind of restriction is usually buried somewhere under a ton of legalese. Wherever possible, click-through caps have been identified under the individual affiliate program listings elsewhere on this site.

Revenue accrues very slowly
Unless you have tens or hundreds of thousands of page-views per month, your earnings are likely to increase at a snail's pace.

A practical example: if your site gets 5,000 page-views a month, and you are displaying banners for a click-through program that pays $0.10 per click-through, then if you get a 3% click-through ratio (pretty good for the average site) you will earn $15 for that month. Not a sum to be sniffed at, but not one that will make you rich either.

You never cross the minimum earnings threshold
Some affiliate programs impose a minimum earnings threshold; that is, the minimum amount of money you have to earn before they will send you a cheque. They impose a threshold since it will cost them too much to send out a cheque every month for a dollar or so. Most thresholds are reasonable, of the order of $15 to $25. Some usurious sites require you to accumulate $100 or more before they will pay you.

As we saw earlier with the issue of revenue accruing very slowly, if you have a low-traffic site you may NEVER reach the minimum threshold to receive a cheque.

Advice: if your site's traffic is so low that it is clear you will never get paid, consider a commission-based affiliate program. That way, you only have to get lucky and make a couple of sales in order to receive a cheque.

Warning: a few unscrupulous sites will reset your earned commission to $0 at the end of every pay period (month or quarter). If you do not exceed the minimum earnings threshold you will lose all accumulated credit and be back at square one. Avoid these programs except if you are sure you'll earn enough (it is not worth dismissing these programs out of hand since some of them pay a very high commission and therefore if you have the traffic they might still be worthy of consideration.)

There are a few of these programs out there, but they seem much less popular than commission-based programs. Essentially, a flat-fee referral program will pay you a predetermined, fixed amount for every new visitor who makes at least one purchase from the site.

Occasionally, payment may be offered for something other than a purchase, such as a visitor filling in a form to ask for more information, or requesting a catalogue.

Advantages: If you get lucky (read: manage to send over a new visitor who feels like buying something) you will probably get more money than you would have received had you been participating in a commission-based scheme.

Also, each "success" is guaranteed to net you a reasonable amount of cash, so you only need two or three before the site starts writing you that cheque you covet.

Disadvantage:
The constant need for new visitors
The key to these programs is that they all require new visitors. If you send over somebody who has already purchased via the site, you won't see a dime for your efforts. And remember, we're not just talking about people who bought after coming from your site: if the person has been a customer any time in the past, having arrived at the site by whatever means, you will not get paid.

Advice: Calculate how much you would get per new referral vs. how much you could make if you were working on commission, then try to estimate how many people you can persuade to click through and buy something.

For instance, if a flat-fee program offers $10 per new customer and your choice is between that or a commission-based program offering 5% of sales, it is easy to calculate that your visitor would need to buy $200 worth of merchandise for you to receive the same payment as you would under the flat-fee system. In this example, if the products being sold are books or videos (or anything with a low per-unit cost) you might be better to take your $10 per new visitor, and accept the fact that your earnings will go up less frequently, but in bigger steps.

Commission-based programs are by far the most common type of affiliate program you can find. They pay a predetermined % commission on the revenue generated by the sale of a product or service to a visitor who came from your site. Some programs offer a sliding scale of commissions to reward affiliate sites with high traffic; other programs stick to a flat commission rate for any level of sales.

Advantages: A carefully selected affiliate program can actually enhance your visitors' enjoyment of your site, as well as make you money. For example, if I just enjoyed reading a witty, detailed book review, I might be very glad of a simple way of buying the book I was just reading about.

Again, if the affiliate program matches the content of your site, you are likely to get good results from a commission-based system. In a way, it's a test of your own credibility: how much do your visitors value your opinion, and how much do they trust your ability to pick things they would be interested in buying.

Disadvantage:
A low click-through to conversion rate
You will find that only a few percent of your visitors will click on the banner or link advising them to buy; of that percentage, an even smaller percentage will actually buy something. It can be disheartening to see that there have been thousands of visits to your site and no sales. Of course, the more you can focus your affiliate program and integrate it into your site, the better your chances will be!