Why do companies run their own program

[Struggle4Bucks]

Lately you can read here about all the companies that stopped paying out their affiliates.
I was just wondering... why would they want to run their own program anyway? I mean... I use epoch for my affiliateprogram. They pay all my affiliates correct and on time. Even if I would fuck my business up my affiliates still get their money...

Why do companies want to run their own program? They also have to hire employees for the admin and making payouts to affiliates... I don`t see the benefit...

[V_RocKs]

Because then you can fuck over your affiliates....

DUHHH!!!

On a serious note... Because then you can cascade your billing... But then now you can do this with CCBILL... I think EPOCH too...
When you run your own program and you have 1000 affiliates that didn't hit their payouts for average of $50 you have $50,000 floating in the bank and collecting interest. If you leave that to EPOCH they make the money on the float, not you.

After Epassporte took a shit I switched up my main money makers that day to pay me by check. But some of the not so money makers I didn't get around to... So now every once in a while I will login to a program and find that I have $1600 sitting there waiting for me to put in a valid payout method. Those sponsors make interest on that cash... Otherwise, again, it'd be EPOCH...

[Struggle4Bucks]

Originally Posted by V_RocKs

Because then you can fuck over your affiliates....

DUHHH!!!

On a serious note... Because then you can cascade your billing... But then now you can do this with CCBILL... I think EPOCH too...
When you run your own program and you have 1000 affiliates that didn't hit their payouts for average of $50 you have $50,000 floating in the bank and collecting interest. If you leave that to EPOCH they make the money on the float, not you.

After Epassporte took a shit I switched up my main money makers that day to pay me by check. But some of the not so money makers I didn't get around to... So now every once in a while I will login to a program and find that I have $1600 sitting there waiting for me to put in a valid payout method. Those sponsors make interest on that cash... Otherwise, again, it'd be EPOCH...

Yeah... i was starting to believe to fuck affiliates indeed...
ok... floating money for collecting interest... Well... you must have a lot of affiliates and a lot of floating money then before you make some money out of interest... especially if you think of the employees you need (and need to pay) to run your own program... And don`t forget about the headache for having employees:-)

[Paul Markham]

Because they can do it in house.

Because affiliates are no longer necessary.

Because affiliates are too demanding in what they want.

Because if they don't, they will go under.

Pick for yourself the reasons.

[OldJeff]

The reason has not been posted in this thread yet

[Struggle4Bucks]

Originally Posted by Paul Markham

Because they can do it in house.

Because affiliates are no longer necessary.

Because affiliates are too demanding in what they want.

Because if they don't, they will go under.

Pick for yourself the reasons.

-what do you mean with "they can do it in house"? If you mean running their
own program... yeah... but they could also do it out house... I don`t see
the benefits for running your own program... I only see a lot of headache...
-if affiliates are no longer necessary why do 99% of all companies
run some sort of a program? And then... why would you still use
a ccbill/epoch affiliateprogram on paulmarkhamteens.com if you think
affiliates are no longer neccesary?
-what have "too demanding affiliates" to do with a companies` own program or
a program based on epoch/ccbill?
-Well... they for sure go under if they don`t pay their affiliates...

Thanks for any info, but I don`t see any valid reasons

[Struggle4Bucks]

Originally Posted by OldJeff

The reason has not been posted in this thread yet

Do you have any idea when you are going to post the answer in this thread?

[Konda]

It's cheaper to run your own merchant account.
Not for small programs, but if you can save 5% or more on volumes of a couple of 100K a month in processing it is worth it to take things in-house.

In addition when you have a lot more possibilities in terms of upgrades, cancel offers, xsales, 1click upsales, etc. if you run your own merchant accounts. You can make a lot more money that way.

You can also decide on your own fraud filters/scrubbing, cascading etc.

[Paul Markham]

Originally Posted by Struggle4Bucks

-what do you mean with "they can do it in house"? If you mean running their
own program... yeah... but they could also do it out house... I don`t see
the benefits for running your own program... I only see a lot of headache...
-if affiliates are no longer necessary why do 99% of all companies
run some sort of a program? And then... why would you still use
a ccbill/epoch affiliateprogram on paulmarkhamteens.com if you think
affiliates are no longer neccesary?
-what have "too demanding affiliates" to do with a companies` own program or
a program based on epoch/ccbill?
-Well... they for sure go under if they don`t pay their affiliates...

Thanks for any info, but I don`t see any valid reasons

Did you read the title of the thread?

The fact it's being asked shows you how some think.

[OldJeff]

Originally Posted by Struggle4Bucks

Do you have any idea when you are going to post the answer in this thread?

There are actually several.

CCBill, Epoch, etc are all 3rd party processors.

The reasons for running your own "program" as you called it is to process on your own merchant accounts, you pay lower processing rates, typically have better throughput, and much more control over the scrub.

Cost less, more sales, equals more profit.

The answer is 100% of the time, more profit.

[OldJeff]

Originally Posted by Konda

It's cheaper to run your own merchant account.
Not for small programs, but if you can save 5% or more on volumes of a couple of 100K a month in processing it is worth it to take things in-house.

In addition when you have a lot more possibilities in terms of upgrades, cancel offers, xsales, 1click upsales, etc. if you run your own merchant accounts. You can make a lot more money that way.

You can also decide on your own fraud filters/scrubbing, cascading etc.

WINNER !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! !!!!!!!!!!!!

[Struggle4Bucks]

Originally Posted by OldJeff

There are actually several.

CCBill, Epoch, etc are all 3rd party processors.

The reasons for running your own "program" as you called it is to process on your own merchant accounts, you pay lower processing rates, typically have better throughput, and much more control over the scrub.

Cost less, more sales, equals more profit.

The answer is 100% of the time, more profit.

Lower processing costs would sound logic to me if these big companies were
direct merchants at visa. But they are not... They too use 3rd party processors
for processing their payments BUT not for running an affiliate program... most big
companies have their own affiliate program. I don`t think epoch is charging me for paying out my affiliates... I just pay for the processing fees regarding my members...
In that case... where is the benefit for running your own affiliate program?

Thanks for all input...

[OldJeff]

Originally Posted by Struggle4Bucks

Lower processing costs would sound logic to me if these big companies were
direct merchants at visa. But they are not... They too use 3rd party processors
for processing their payments BUT not for running an affiliate program... most big
companies have their own affiliate program. I don`t think epoch is charging me for paying out my affiliates... I just pay for the processing fees regarding my members...
In that case... where is the benefit for running your own affiliate program?

Thanks for all input...

There are no direct Merchants at Visa, but you have your own accounts direct with the Merchant Bank, even after adding up all the other fees associated, you are more profitable.

But as noted, if you are not able to process very large volume, you are better off running with CCBill, Epoch, etc

[Struggle4Bucks]

Originally Posted by Konda

In addition when you have a lot more possibilities in terms of upgrades, cancel offers, xsales, 1click upsales, etc. if you run your own merchant accounts. You can make a lot more money that way.

You can also decide on your own fraud filters/scrubbing, cascading etc.

putting it like this... more controll and possibilities could indeed make you more money...
but i guess indeed that it only pays when you`re a very big company...
Thanks!

[Struggle4Bucks]

Originally Posted by OldJeff

There are no direct Merchants at Visa, but you have your own accounts direct with the Merchant Bank, even after adding up all the other fees associated, you are more profitable.

But as noted, if you are not able to process very large volume, you are better off running with CCBill, Epoch, etc

Yes... it could very well be that i`m too small to understand the benefits of running an in house program

On the other hand... i don`t get the idea of being a big company and not be able to pay out affiliates

Maybe some companies overestemate their business... start running their own program too soon and then get into trouble...

[Konda]

Originally Posted by Struggle4Bucks

Yes... it could very well be that i`m too small to understand the benefits of running an in house program

On the other hand... i don`t get the idea of being a big company and not be able to pay out affiliates

Maybe some companies overestemate their business... start running their own program too soon and then get into trouble...

Some of them go for the quick buck and take too much risk and end up losing their merchant account. They then get another merchant account, take even more risk (to make the lost money back), and lose their merchant account again. This happens a couple of times, they have to setup new corporations to setup more merchant accounts, but eventually they run out of options and they just take whatever money is left and quit.
And in a lot of cases these companies are run by business partners that somewhere along the lines split up or get in a fight and one taking all the money that is left.

Most of these guys keep coming back with new programs under new names.

[OldJeff]

Originally Posted by Struggle4Bucks

Yes... it could very well be that i`m too small to understand the benefits of running an in house program

On the other hand... i don`t get the idea of being a big company and not be able to pay out affiliates

Maybe some companies overestemate their business... start running their own program too soon and then get into trouble...

Were you asking questions, or looking to start a fight with someone ? You asked what the advantages are, were given a bunch of answers, and it seems you are more interested in something having nothing to do with what you asked.

[Struggle4Bucks]

Originally Posted by Konda

Some of them go for the quick buck and take too much risk and end up losing their merchant account. They then get another merchant account, take even more risk (to make the lost money back), and lose their merchant account again. This happens a couple of times, they have to setup new corporations to setup more merchant accounts, but eventually they run out of options and they just take whatever money is left and quit.
And in a lot of cases these companies are run by business partners that somewhere along the lines split up or get in a fight and one taking all the money that is left.

Most of these guys keep coming back with new programs under new names.

Interesting...
Hmmm sounds like some companies put more time and effort in fucking around, close their fucked business, start another, fuck around again, close another fucked business, start another "start to fail" business, etc... rather then slowly build up a solid company...

[Struggle4Bucks]

Originally Posted by OldJeff

Were you asking questions, or looking to start a fight with someone ? You asked what the advantages are, were given a bunch of answers, and it seems you are more interested in something having nothing to do with what you asked.

I really don`t know what you are talking about... me looking to start a fight? I really don`t know where you found that idea... really... I asked questions... got some answers...
had some questions about some answers, had questions coming up from some answers, etc... why would i wanna start a fight? I`m only trying to figure out this business... that`s all...

???????????

[OldJeff]

Originally Posted by Struggle4Bucks

I really don`t know what you are talking about... me looking to start a fight? I really don`t know where you found that idea... really... I asked questions... got some answers...
had some questions about some answers, had questions coming up from some answers, etc... why would i wanna start a fight? I`m only trying to figure out this business... that`s all...

???????????

My mistake, I misunderstood what you were saying

[Bugbee]

Originally Posted by Paul Markham

Did you read the title of the thread?

The fact it's being asked shows you how some think.

I hope so it is his thread lol

[2012]

it's easier to fuck with the stats, confusing affilliates on the actual fucking traffic situation which leads to affilliate taking traffic and sticking it up ass elsewhere

[Struggle4Bucks]

Originally Posted by OldJeff

My mistake, I misunderstood what you were saying

no problem

thanks for your input!

[shake]

I think the answer summed up is "more control" over everything.

[Struggle4Bucks]

Originally Posted by Bugbee

I hope so it is his thread lol

yeah indeed I did not only read it I wrote it...

I didn`t found a reason to respond to that reply because it didn`t answer
the questions... if it did answer my questions then please inform me about what i`m missing...

[adultmobile]

Originally Posted by 2012

it's easier to fuck with the stats, confusing affilliates on the actual fucking traffic situation which leads to affilliate taking traffic and sticking it up ass elsewhere

Cam sites all must have own custom program even if they didnt wanted to fuck affiliates, and normally run custom site code too, so it is a case on its own. Regarding normal pay sites with member area access, probably is what you said, you can shave better. in other cases, the program owner was honest but wrongly thinking it will save money, but instead will spend more as to manage affiliates who dont read instructions and write bullshit in GFY it cost more than the 5% you save with own merchant account, really.

[Freaky_Akula]

It is easier to shave sales and steal money.

[Paul Markham]

Originally Posted by Bugbee

I hope so it is his thread lol

Then good luck to him.


Let's look at why it's better to do traffic generation in house.

Opening a Tube and putting your own content at the top and making sure it's the most frequently seen is good. Then adding others content to be an affiliates. The site can also strike up relationships with the mega Tubes if required. Can be carried through to TGP sites as well.

Blogs, OK if English is a second language it's tough. Otherwise all the tips and articles are online to teach people how to write blogs.

SEO. This is a skill to operate at the highest level, a lot is getting linked to other sites of the right kind. Getting traffic and making sure it doesn't return to the SE, seems to be important. This is IMO the highest skill of affiliates and if good at it, expensive to hire.

Adwords. When you get all the join money, it's better than having to buy with half the money. Also makes it more expensive for affiliates to compete.

The site can be built and run 100% to suit the owner, no worries with affiliates telling you what to do and what not to do.

Running an inhouse traffic program means there's a need to create content for traffic generation. But it's yours to keep and not 100s of affiliates to share.

The site owner doesn't give out 30%-35 of his turn over to affiliates, using Madalton's figures here. I can verify it and so will many others.

Times are tight, the glory days are gone. It just sometimes makes sense.

The fact that the sites are open and the program has closed is all the proof you need it can be done. That so many are answering the thread tells you it's having an effect. The tone of reply tells you the effect it's having.

[2012]

Originally Posted by freaky_akula

it is easier to shave sales and steal money.

bingo!!! we have a winner

[2012]

just keep the "uniques" as low as possible. that way, they'll keep sending more traffic ... and if they'll believe that, they'll believe anythinggggg !!!! muah hahahahahahahahahaha

wait, better idea.

let's stagger the sales. one month = REALLY GOOD ( they'll send more traffic next month ) but next month we'll give them squat shit muah aha aha ...........rinse and repeat

[iwantchixx]

Originally Posted by Paul Markham

Because they can do it in house.

Because affiliates are no longer necessary.

Because affiliates are too demanding in what they want.

Because if they don't, they will go under.

Pick for yourself the reasons.

After 567 years peddling porn, even you should know that not all of this is true, Paul ....

[iwantchixx]

Originally Posted by Paul Markham

Then good luck to him.


Let's look at why it's better to do traffic generation in house.

Opening a Tube and putting your own content at the top and making sure it's the most frequently seen is good. Then adding others content to be an affiliates. The site can also strike up relationships with the mega Tubes if required. Can be carried through to TGP sites as well.

Blogs, OK if English is a second language it's tough. Otherwise all the tips and articles are online to teach people how to write blogs.

SEO. This is a skill to operate at the highest level, a lot is getting linked to other sites of the right kind. Getting traffic and making sure it doesn't return to the SE, seems to be important. This is IMO the highest skill of affiliates and if good at it, expensive to hire.

Adwords. When you get all the join money, it's better than having to buy with half the money. Also makes it more expensive for affiliates to compete.

The site can be built and run 100% to suit the owner, no worries with affiliates telling you what to do and what not to do.

Running an inhouse traffic program means there's a need to create content for traffic generation. But it's yours to keep and not 100s of affiliates to share.

The site owner doesn't give out 30%-35 of his turn over to affiliates, using Madalton's figures here. I can verify it and so will many others.

Times are tight, the glory days are gone. It just sometimes makes sense.

The fact that the sites are open and the program has closed is all the proof you need it can be done. That so many are answering the thread tells you it's having an effect. The tone of reply tells you the effect it's having.

I don't understand this whole thing about Affiliates telling programs what to do. Build the program correctly and that doesn't happen.

In-house is extremely important. I will definitely agree with you on that. Factoring time and resources, Costing a few bucks per sale is definitely better than costing 50% or the large PPS rate. Every successful program knows this. Then again.. even some programs-past that had all their ducks in a row still failed. There is NO perfect formula for success.

[2012]

hey, give him a ccbill sale ... get that traffic coming again ... tee hee , if not we can always charge it back next month , win win win !

[Paul Markham]

Originally Posted by iwantchixx

After 567 years peddling porn, even you should know that not all of this is true, Paul ....

I know programs that did it instead of shutting up shop.

I don't understand this whole thing about Affiliates telling programs what to do. Build the program correctly and that doesn't happen.

what you think's correct might not be what they think is correct.

In-house is extremely important. I will definitely agree with you on that. Factoring time and resources, Costing a few bucks per sale is definitely better than costing 50% or the large PPS rate. Every successful program knows this. Then again.. even some programs-past that had all their ducks in a row still failed.

Where does extremely important become all that's required. As you said different horses for different courses. If a site has something that really sells, an establish brand, a great conversion rate. Why should it pay out the same rate as those that don't?

There is NO perfect formula for success.

Best thing you posted. Some who failed were ones who thought there was.

The game is changing and the changes are biting. Ride with them. Because in todays porn business unless you have something really good to offer, you're not going to last long.

Yes I was lucky, got out before the last part bit me in the ass.

[rowan]

A legacy from the days when affiliate sales accounted for the majority of revenue.

A way to fiddle with the stats as there's no third party handling/auditing the data.

A way to make some money on the way out by abruptly closing the program when it becomes more profitable to steal any remaining rebills rather than continue the program.

[PervertPass]

As a small program I can say that there is a huge upside to having CCbill do my payouts for me. I can focus on my content.. THe downside is that bigger programs can offer things like $50-200 PPS "wednesdays" etc etc. which We can't do with CCBill running out payouts.

On the other hand I do have CCbill and using NATS for traffic so if your an affiliate and want to promote a new program with Pornstar and Big Tit sites sign up to Filthpays.com

;)

[rowan]

Originally Posted by rowan

A legacy from the days when affiliate sales accounted for the majority of revenue.

A way to fiddle with the stats as there's no third party handling/auditing the data.

A way to make some money on the way out by abruptly closing the program when it becomes more profitable to steal any remaining rebills rather than continue the program.

Forgot to mention the potential for banging customer's cards... either non obvious prechecked cross sales (shady) or just outright fraud.

[signupdamnit]

Originally Posted by Freaky_Akula

It is easier to shave sales and steal money.

Sadly you're right about some of them. I have one which has done 1:1500 consistently for a while suddenly start doing 1:6000 just like that. A couple months prior to that amazingly there are no new rebills ad each month I would lose some rebills. Just a little guy with his MPA3 who probably decided to milk whatever he can out of his affiliates before he exits the pay site business for good.

It pisses me off the most because I realize he was probably screwing me in the past too. Another related sponsor in that niche used to convert 1:200 around the same time and their sites and tours weren't as sharp as his. I probably bought him a house over the last three years. Bastard.

It's another good reason for insisting on third party affiliate tracking. Human nature being what it is when things get tough it's all too tempting to steal from the affiliate and justify it with any one of a hundred different excuses.

[adultmobile]

Originally Posted by signupdamnit

It's another good reason for insisting on third party affiliate tracking. Human nature being what it is when things get tough it's all too tempting to steal from the affiliate and justify it with any one of a hundred different excuses.

Conspiracy theories arise on CCBill stats too, just see GFY posts for CCBill. People will think of a shaving even if the program it is honest, and even if this is a third party, there is no way to let everyone think simply his traffic it was lots of indians, chinese and turks so it can't convert. In fact we put a geo report per country in our affiliate stats so the guy it can see his 10% india, 8% china, 7% turkey etc. then just 25% it was USA... if ratio is 1:1000 maybe from good countries only it is instead a 1:300, it is not that the program hide the sales.

[signupdamnit]

Originally Posted by adultmobile

Conspiracy theories arise on CCBill stats too, just see GFY posts for CCBill. People will think of a shaving even if the program it is honest, and even if this is a third party, there is no way to let everyone think simply his traffic it was lots of indians, chinese and turks so it can't convert. In fact we put a geo report per country in our affiliate stats so the guy it can see his 10% india, 8% china, 7% turkey etc. then just 25% it was USA... if ratio is 1:1000 maybe from good countries only it is instead a 1:300, it is not that the program hide the sales.

I know it sounds ridiculous but after a while you start to develop a sixth sense about these things. You can tell when you are getting fucked. Like making ten sales in the first two days with a program then after sending in your tax info you start making ten sales a month. Or when your traffic converts 1:6000 but the sponsor is hitting you up every other month to inquire about buying ad space. You see these patterns and have these feelings. There's this little voice inside your head saying "Hey now!" Usually you're better off listening. ;)

[venus]

Its simple, control.
I have been running my own program since 1999 (or 1998, cant rmember), but for me its about control, my question is why would you give someone else so much control over your business?

I own all my own servers in 2 different locations,(mail, DNS, web, video, chat), I own all my own software, affiliate program, password protection, mailing lists and son on, and I have my own merchhant account. All my software is on my servers, I do not (and will not) pay a subscription fee for any of my software. If ccbill or what ever goes down, or the person who controls your affiliate software goes down or what ever, you lose.

If I have an affiliate who writes and says front me something extra on my next check, I can do that if I want, if there is fraud involved I dont send the scammer a check or I can stop a check, I also choose to eat the costs of chargebacks and refunds and not make the affiliate pay it. The affiliate is also not charged a percentage, if he is owned $100, he gets $100, not 80$. Its my business, I control it, I make the decisions, not a bunch of other people. I will never cede control of my business to others.

If any one of these places you rely on, pulls an ibill, you are broke. You also end up paying out less each month in the long run.

[2012]

Originally Posted by signupdamnit

I know it sounds ridiculous but after a while you start to develop a sixth sense about these things. You can tell when you are getting fucked. Like making ten sales in the first two days with a program then after sending in your tax info you start making ten sales a month. Or when your traffic converts 1:6000 but the sponsor is hitting you up every other month to inquire about buying ad space. You see these patterns and have these feelings. There's this little voice inside your head saying "Hey now!" Usually you're better off listening. ;)

or when your sponsor starts competing with you with their own shit sites and chinese work force, welcome to 2012

[Struggle4Bucks]

Originally Posted by OldJeff

There are no direct Merchants at Visa, but you have your own accounts direct with the Merchant Bank, even after adding up all the other fees associated, you are more profitable.

But as noted, if you are not able to process very large volume, you are better off running with CCBill, Epoch, etc

Ahhh... I think i finally fckng get it after reading about the difference between an ipsp and a gateway... aha not an account at an ipsp but get an account with the merchant bank directly and that in combination with an inhouse affiliate program... ok I can see the benefit now... well the financial benefits for the program... on first sight... I can also feel the headache for all extra work; getting employees; the risk that will be on the company`s side; fraudriskissues, etc etc...

Great forum/Complicated business:-)

Thanks for all info!

[Supz]

It costs less

[SilentKnight]

As a husband/wife company - neither of us had the time or desire to handle an affiliate program, so a few years ago we opted to have Verotel handle it for us. No muss, no fuss.

I resisted even having an affiliate program for the longest time. It was never about the money for us. But so many people contacted us wanting to promote our stuff over the years, we finally decided to placate everyone and launch a program.

Truth be told - I've never even looked at the affiliate stats (although my wife does once or twice a year). I couldn't even give a ballpark figure of our affiliate transactions.