Affiliate Revenue vs Recurring Revenue

**Atomm** · 07-08-2006, 03:16 PM

Which option would you choose in the following situation?

You have a niche website that has a very high CPA. You own the #1 spot on Google and MSN. You could turn it into an Affiliate only site with content supporting the niche or you could turn those people into your customers through an outsourced company. If a customer signs up with you, the first year net profit would be just under what the affiliate payouts would be. And the product you offered would be just as competitive as the affiliate offers.

Do you put up 5 Affiliates and go for the 5 chances to get a CPA payout or do you opt for the 100% outsourced opportunity and go for the recurring revenue?

My gut tells me to go for the recurring revenue because cash flow is king, but my brain tells me it's better to take 5 chances at coverting than to take one chance you can make them a customer. While the idea of outsourcing really doesn't sound so bad, it does tend to have a bad side effect on the industry.

What are your thoughts?

**seasickmedia** · 07-08-2006, 06:00 PM

look at what shoemoney does, his stuff is membership based and 6 month recuring, that is probably the best but not easy to do.

**zeekr** · 07-08-2006, 07:57 PM

I don't get it, why would you take less revenue by being the seller? If it's because you sell just one option instead of five, as you're outsourcing the sell couldn't you outsource five options too? I mean be your own affiliate?

**Atomm** · 07-09-2006, 12:14 AM

Let me try to say this a different way.

Would you buy a Ford Dealership and let someone else run it or would you make a deal with a multiline dealership for a kickback on every customer you send them?

Not everyone wants Fords, so you are competing with everyone. However, you will have a chance to sell that person a second car down the road because they may be included to buy another Ford.

Or, do you go for mutiple options and send them to 5 different dealers who have different, but similiar products with the hope they will buy something and you will get a kickback.

I like your idea Zeekr, but I'm limited by what my Outsourcing company can do.

**sitedesigner** · 07-09-2006, 01:23 AM

You made a very good point there Atomm

**Atomm** · 07-09-2006, 12:34 PM

Thanks Mathew.

I'd like to get some feedback from the big money guys. Lee, Jon, Shoe?

What are you thoughts on this?