What Is Revenue Share In Affiliate Marketing?
In the affiliate marketing industry, revenue share has emerged as a highly effective payment model and as an alternative to CPA (Cost Per Acquisition), which is another payment model that has gained wide currency.
In the RevShare model, instead of paying a fixed dollar amount to the affiliate marketer for a referred sale, the merchant pays a percentage of the sale amount. Many top brands such as Airbnb, Reebok and Columbus Direct have moved over to this payment method as it is a cost-effective way for them to build their brand.
Here’s how the payment method works. Merchants typically pay affiliates a relative value of the sale amount (usually a certain percentage). For instance, if a merchant is offering 30% revenue share commission and a user on your website buys a product from the retailer for $1,000, you should get exactly $300 (30% of the purchase amount) for the successful conversion.
As an affiliate, you will be entitled to a predefined percentage of profit or sales for a lifetime, or for as long as you can send targeted traffic to a merchant website through your website. While the majority of the Revenue Share plans are designed for a lifetime, some of the plans also come with a certain validity period (e.g. three months or twelve months).
