Originally Posted by Far-L

Feel free to question my math... I was a lit major for petessake:

If someone converts 35% of trials and retains roughly 30% each month of those initial joins:

100 trials, 35 conversions to join....

Month 1 = 35 joins @ $30 per join earns $1050
Month 2 = 14 rebills of those initial 35 joins earns $420
Month 3 = about 4 more rebills earns $120
Month 4 = about 1 or 2 more rebills for $30 to $60
4 month total: roughly $1650

Those initial 35 join would earn an average of about $47 bucks per join ($1650 divided by 35 initial joins with 30% retention over four months). Subtract the cost of the sign up ($25) and you have $22 then divide that by 4 months and the sponsor is earning close to $5.50 bucks a month per join.

So say the sponsor is paying $20 to $25 per sign up...

Those 100 trial sign ups cost $2000 to $2500. After 4 months the sponsor is not even close to breaking even. Now is when all the PPS sponsors say "well we make it up on xsells", "you have to know how to monetize" and "you have to know what you are doing", and my favorite, "you need the volume to make it work".

Most of the PPS programs I know of have had financial problems the moment their traffic conversions thinned out or retention dropped. Even with outstanding up sells, excellent filtering, not paying on dialers etc. the sponsor is still going to be running on the fumes of margins...and oftentimes ethics will be the first thing to vaporize in those conditions...imo, the only way to make it work is to lower the pps payout considerably, imo.

PPS, the way many companies do it, imo, seems a very shaky way to run the shop. I am not saying that Marc De can't make it work. I am saying that others that make the claim that it works are working the hype angle and they don't necessarily hold some sort of secret webmaster knowledge that makes them more profitable. Those are the ones I would ask for an audit from.