Affiliate marketing is in a constant state of flux and with the recent changes in the CPA space it is easy to see why many online marketers have adopted a cautious outlook. But there is hope for the future. A viable alternative to CPA has stepped into the limelight and that alternative centers around digital offers in the Cost Per Sale (CPS) space.
CPS— A Stronger Revenue Model
When most people see the term CPS they immediately think of tangible goods like those sold on Amazon. Digital CPS offers are something different. They have all the advantages of traditional CPS in dealing with hi-quality products, but these products are in digital format (e.g., software utilities). And while up until recently digital CPS offers have been an overlooked alternative to CPA, these kinds of offers are now coming into focus.
The advantage of CPS is that it has reached the point where it is a mature, highly stable business model, with scalability built in. Digital CPS’ hallmark stability is rooted in products that provide real value to the consumer. Such relationships builds credibility and trust with consumers, which in turn gives CPS longevity and insulates it from market storms that often topple less stable revenue models.
Make a Sale, Get Paid — Benefits to the Affiliate
In the CPS model, when a sale is completed the affiliate is assured they will get paid. Furthermore, the hosting and transaction processing is all done by the network, so an affiliate’s commissions are tracked accurately. Commissions in the digital CPS space are high and many transactions are subscription or membership based—meaning the affiliate gets recurring commissions with no extra marketing efforts required.
Once a CPS campaign is up and running, it’s much easier to optimize, grow and sustain. And, there’s no fulfillment or shipping involved when dealing with digital CPS offers, and the range of products available in digital CPS allows affiliates to diversify their portfolios. There are no caps on campaigns and many affiliates have been successful running the same campaigns for over 3 years.
New Revenue Opportunities Abound
Digital CPS offers provide additional revenue streams through a combination of up-sells, cross-sells, re-bills and bundles. What’s more, new revenue channels such as revenue share programs will multiply and thrive under the CPS model. Results show that by implementing these types of revenue-generating strategies, online marketers can see up to a 2-fold increase in their Average Order Value and generate recurring income.
The Future Is Bright For CPS
Everyday more people are connecting via the Internet and becoming more comfortable making purchases online, and this means an increase in opportunity and market share for the sale of digital products and services (e.g., mobile and Mac products). According to a new report by Interactive Media in Retail Group (IMRG), global businessto- consumer e-commerce sales will top $1.25 trillion by 2013, and the total number of Internet users will increase to approximately 3.5 billion from 2.2 billion in 2011. In 2011, business-to-consumer e-commerce sales increased by 20% from the year prior.
This is great news for affiliates. The advent of digital products, services and devices has created a new ‘digital core’— or ‘digital home’ — where people from around the globe gather, interact, and purchase digital goods. This growing online community is here to stay, and the opportunity it gives affiliate marketers and vendors will continue to grow along with it.
While some critics have argued that the challenge to CPS is a potential stalling of innovation and growth, it’s clear that all signs indicate CPS is actually on the upswing. The new ‘digital core’ is creating an increasingly connected world, and this means more and more customers are shopping online—specifically for quality digital products that provide true value.
Digital CPS will continue to thrive and expand in the global marketplace. Networks have a proven track record (RevenueWire is an example) will emerge as the leaders and innovators by providing ‘clean’, easy to manage campaigns, high commissions, and accurate payouts that affiliates can count on.
Long story short: The future of digital CPS is bright indeed.