GoFuckYourself.com - Adult Webmaster Forum - View Single Post - Need a ponser that's $40 signup $ 50% Rebills

Hooper · 10-22-2001, 02:01 PM

Hey Nimrod,

Do you have ANY idea how hard it is to run a successful program?

I'm not going to go into the many many other factors that go along with running a wm program, but chargebacks, refunds, lawsuits, scam artiss, advertising, content, employees, hosting etc... that shit adds up.

Not to mention that launching a persignup program is extremely expensive to start.

If I sent you 1000 signups today, unless you're already loaded (which i'm fairly confident isn't the case) you would immediately owe me $40,000 dollars. Now assume that you are chaging 2.95 for a 3 day trial & some kind of special promo for buying a full membership upfront (about 10% will buy that instead of the trial if they see value)... so now you've got 100 people that bought a full membership ($4995.00) and the remainig 900 bought trials ($2655.00)..

Now lets be realistic & assume about 50% of the trials stay past the 3 day mark (quite realistic for such an expensive monthly) & get rebilled. So now 450 members get dinged the 49.95 ($22,477.50....

So now lets pause & reflect.

Your first 1 week of being in business grossed you $30,127.50 but you owe me $40,000... so you're now negative $9,873.00.

Lets assume that you have assloads of cash sitting around & can handle that.... Month 2 rolls around & now about 70% of your members (a gracious number given the price of the membership) rebill. So you now have 385 members getting rebilled $19,230. You owe me half of that. So you now owe me $9,615.38 from the rebills and you get to keep the remainig $9,615.38... but don't forget that you're negative $9873.00 already... so now you're STILL negative $257.62.

Pause... reflect.

Now with an industy average of about 1.87 months retention you'll get about 50% of those members to rebill again next month... so 193 rebills go through (in a perfect world) and $9640.35 comes in. You now have to pay me half of that... so you write me a check for $4820.18 and you keep the remainig $4820.18.. but you still had -$257.62 from earlier.

So now your total gross profit is $4562.55.

Don't forget that the billing company takes 11% of that. So since you're running the program you need to eat those costs... coming out to a total of 11% of $58997.85... so the billing company gets $6489.76 which *gasp* puts you in the hole again for $1927.21.

Pause.. Reflect. You're in debt buddy & you still haven't paid your host or your content providers or even factored in the fact that you WILL see chargebacks, refunds and at least a 5% reserve.

So to answer your question... that silence is everybody trying to keep from laughing.

And no.. we're not laughing with you... we're laughing at you.

------ http://www.conversioncash.com
Where the numbers actually make sense.

10-22-2001, 02:01 PM
Hooper Confirmed User Join Date: Jul 2001 Location: A Free America Posts: 2,210	Hey Nimrod, Do you have ANY idea how hard it is to run a successful program? I'm not going to go into the many many other factors that go along with running a wm program, but chargebacks, refunds, lawsuits, scam artiss, advertising, content, employees, hosting etc... that shit adds up. Not to mention that launching a persignup program is extremely expensive to start. If I sent you 1000 signups today, unless you're already loaded (which i'm fairly confident isn't the case) you would immediately owe me $40,000 dollars. Now assume that you are chaging 2.95 for a 3 day trial & some kind of special promo for buying a full membership upfront (about 10% will buy that instead of the trial if they see value)... so now you've got 100 people that bought a full membership ($4995.00) and the remainig 900 bought trials ($2655.00).. Now lets be realistic & assume about 50% of the trials stay past the 3 day mark (quite realistic for such an expensive monthly) & get rebilled. So now 450 members get dinged the 49.95 ($22,477.50.... So now lets pause & reflect. Your first 1 week of being in business grossed you $30,127.50 but you owe me $40,000... so you're now negative $9,873.00. Lets assume that you have assloads of cash sitting around & can handle that.... Month 2 rolls around & now about 70% of your members (a gracious number given the price of the membership) rebill. So you now have 385 members getting rebilled $19,230. You owe me half of that. So you now owe me $9,615.38 from the rebills and you get to keep the remainig $9,615.38... but don't forget that you're negative $9873.00 already... so now you're STILL negative $257.62. Pause... reflect. Now with an industy average of about 1.87 months retention you'll get about 50% of those members to rebill again next month... so 193 rebills go through (in a perfect world) and $9640.35 comes in. You now have to pay me half of that... so you write me a check for $4820.18 and you keep the remainig $4820.18.. but you still had -$257.62 from earlier. So now your total gross profit is $4562.55. Don't forget that the billing company takes 11% of that. So since you're running the program you need to eat those costs... coming out to a total of 11% of $58997.85... so the billing company gets $6489.76 which gasp puts you in the hole again for $1927.21. Pause.. Reflect. You're in debt buddy & you still haven't paid your host or your content providers or even factored in the fact that you WILL see chargebacks, refunds and at least a 5% reserve. So to answer your question... that silence is everybody trying to keep from laughing. And no.. we're not laughing with you... we're laughing at you. ------ http://www.conversioncash.com Where the numbers actually make sense.