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How to rethink your affiliate payout strategy

Published about 2 months ago • 1 min read

Hi there 👋🏼

Stop offering every affiliate the same revenue share.

I know this might sound counterintuitive, but after working with hundreds of affiliates across dozens of SaaS programs, I've noticed something critical:

Different types of affiliates have fundamentally different business models.

And if your commission structure doesn't align with how they make money, they won't promote you – no matter how high your percentage (maybe).

Here are the four main commission models I’ve seen across the board:

1. Revenue Share

  • Best for: Content creators, bloggers
  • Traditional percentage of each sale
  • Works well when content has long-term SEO value
  • Typical range: 20-40% recurring
  • Pro tip: Add activation bonuses ($200-500) to encourage first content pieces

2. Cost Per Lead

  • Best for: Review sites, comparison platforms
  • Fixed payment per qualified lead
  • Provides predictable revenue for high-traffic sites
  • Typical range: $2-25 per qualified lead (dependent on quality)
  • Pro tip: Define lead quality criteria clearly (demo booked, free trial started)

3. Hybrid Placement + Performance

  • Best for: Industry influencers
  • Upfront fee for guaranteed promotion
  • Performance bonus for results
  • Typical range: $2-5K placement + 15-20% revenue share
  • Pro tip: Tie placement fees to specific deliverables

4. Cost Per Click

  • Best for: PPC affiliates, media buyers
  • Fixed rate per qualified click
  • Works for affiliates with paid traffic
  • Typical range: $1-15 per click
  • Pro tip: Start small and scale based on conversion data

The key is flexibility. Instead of forcing affiliates into your preferred model, ask about their business model during onboarding and match your commission structure accordingly.

Implementation Tips:

Remember: The goal isn't to offer the highest commission – it's to align your incentives with how your best potential affiliates actually run their businesses.

Best,

Nick

P.S. Need help calculating equivalent rates across different models? Reply to this email and I'll share the spreadsheet I use.

Nick Cotter

Founder, Growann

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