Deciding between CPA or revenue share can significantly impact your affiliate marketing strategy. Explore the pros and cons of each payout model to align your approach with your long-term financial goals.
CPA and Revshare are both incredibly popular models that affiliates from all over the world use for their campaigns. Both of them have their ups and downs, and knowing what these are is very important. Some affiliates have made incredible wealth through each of them, and some even utilized both.
Without any doubt, both of these models are incredible, but there is always one that is better for a specific situation. Most beginners start with a CPA program and just stick with it since they know it best. Some more experienced affiliates dabble in RevShare programs as well.
Usually, people say that CPA affiliate marketing programs are best for those who want to make a quick buck. They say it’s a fast and reliable method to monetize your campaigns. On the other hand, the usual opinion on Revshare is that it’s more long-term. A slow burn that brings in earnings over a long period steadily and reliably. But what if this is true and which of these payout models is the best for you? First, let’s cover the basics of both of them!
RevShare Commission Payouts
Revenue Share or RevShare for short is a commission model where affiliate marketers earn a percentage profit of each sale they help make. So, you as an affiliate get a share of the revenue that the customer creates. This is one of those old-school types of affiliate marketing models that are pretty easy to grasp the concept behind.
But, even if it sounds very simple, it is far from it. RevShare offers are usually long-term offers that can last for months or even years. So in theory, one incredible campaign can set you for a long time. But this is all much easier said than done. Even though it has incredible potential, the reality is a bit different. If you as an affiliate aren't active and working on improving your marketing, you can potentially lose your revenue quickly.
Unlike CPA where you get paid for small feats, RevShare is all about finalizing that sale. Making it very difficult for beginners. As you might think, getting people to pay for something is the hardest part of any marketing campaign. Because of this reason, people usually recommend people to only do RevShare when they have a lot of experience in the field. Commissions on revenue share usually start low but increase steadily as your client base grows. This means that it will take a long time to turn a profit and even longer to make any significant sum off of it. And the worst part is that the long-term earnings aren’t guaranteed, so you could be wasting your time completely.
CPA Commission Payouts
CPA (Cost-per-action) is an affiliate marketing model where affiliates are paid for a certain action. These actions can vary. Some are linked to website visits while others are linked to subscriptions or something completely else. These actions don’t have to be sales, and mostly they aren’t. Here is a bigger list of what CPAs can be:
- Sales
- Subscriptions
- Email Signup
- Email Sharing
- Clicks on Banners / Ads / Links
- App Installs
- Downloads
- Registrations
- Filling Out Forms
- Much more!
This model was created for internet promotions and marketing in general. The main idea behind it is that advertisers should pay affiliates only for specific actions that they want the users to take. This means that CPA is much better for focusing attention on specific business results. Results that will increase leads, conversions, and sales.
All of this made CPA an incredible model today. CPA is by far the most popular affiliate marketing model today and for good reason. It is simple to use and utilize and the results from it are incredible. Affiliates love it as well as it doesn’t always require you to make a sale. It can be a plethora of easier or harder achievements for your users.
Think about it, depending on your CPA goal, you can get money for making someone give his email or install a free app. Which, you will agree, is a lot easier than getting them to whip out their credit card and buy something expensive.
What Are The Main Differences?
The biggest difference is the mechanism that these models work by. While CPA can earn you money for small tasks like email signups or app downloads, RevShare offers will only pay out a percentage when a sale is made. This can of course be very difficult and sometimes even though you try your best, it just won’t work.
RevShare is also praised for its potential to make you money for years after you launch a campaign, but that doesn’t always have to be the case. I mean, think about it. How many affiliate programs do you know that are running for over a few years? Most affiliate programs end way earlier because the market is so dynamic. And with those programs, your RevShare profit will vanish as well. So you will be back to square one sooner than you might think.
Also, RevShare is a far more difficult concept to fully utilize for beginners. There is a lot more thing you have to do to make it work and gain you revenue. Before taking up any offers you should research the current market and trends a bit and try guessing if it even has a chance to work. The percentages you can expect can range from 5% to as much as 25% of sales. Some offers give special additional incentives. An example is if you reach a specific goal you will get an additional bonus.
Targeting audiences and locations have some differences between the two models as well. CPA models assume that the advertisers chose the methods of traffic, so affiliates are somewhat restricted by these choices. Revenue Share on the other hand doesn’t limit your traffic sources or methods. You act on your own accord which can be a blessing and a curse at times.
Payment wise, most CPA networks pay weekly, bi-weekly, or even daily and there are no refunds. So your payment is secure. RevShare payments go through the entire length of the contract. Payments can be reduced or increased based on the performance of certain months. The payment period completely depends on the deal that you make, but in most cases,30-45 days. Sometimes payments can be quarterly, which means you will have to wait a bit more for your cash.
Which Should You Use?
This question is often asked and the answer isn’t always clearly defined. Sometimes CPA is a much better option while sometimes RevShare is the preferred one. If you are a beginner RevShare might not be the best choice as it requires a lot of knowledge and experience to make it work. CPA on the other hand is great for beginners and pros. It is easy to start but difficult to master. So there are a lot of opportunities to grow.
In general, if you are:
- In for the short term
- Want profits upfront
- Don’t expect long term users
Then a CPA Payout is much better for you. It will allow you to get larger one-off payments without worries about what happens to your leads afterward. You will always have to run new offers and promotions and target new audiences to ensure optimal results. It is also a much better option for more inexperienced affiliates as some offers are quite easy to make work. The offers can also scale up to crazy amounts and it’s no wonder that most industry veterans prefer using CPA.
If your strategy is to create something more long-lasting that might make you money in the long-term then RevShare should be something you should consider. You will have to nurture your relationship with your audience as your business model is to stick with them for as long as possible. With the revenue share model, you will focus on increasing engagement and optimizing your targeting far more. Profits will come slow and take a long time to build up to a notable sum. This really isn’t the model that you should work with if you are planning on making your money quickly.
RevShare is a better option if you already have some experience and you want to try a more long-term solution. Of course, nothing is guaranteed to work long term.
Conclusion
Both CPA and RevShare are incredible forms of marketing that affiliates should know about. Both of them have their own pros and cons and finding the best one for you should be done carefully. We think that CPA has a few more benefits over RevShare as it is easier to use. Sometimes the deciding factor will be the offer you get.
A big deciding factor should be your goals. If you want something that will make you money straight away, then don’t even think about Revshare. If you are all about the long-term gains then CPA is not going to be your thing.
Whatever you choose, you should know that you can have failure and success with both. You should learn and research both of these models and understand them as best as possible. Even if something doesn’t go as well as you planned, don’t quit and keep improving. Eventually, you will have guaranteed success with both!
Which of these marketing methods do you prefer? Leave a comment and tell us more about your experience with CPA and RevShare!
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