RevShare: mastering revenue sharing for webmasters
Several payment models are prevalent in affiliate marketing, with RevShare being a highly popular choice, often associated with gambling affiliate networks. This model often ignites enthusiasm among newbies eager to participate in casino profit-sharing schemes. However, there’s a common belief that RevShare might not be the ideal model for beginner affiliates. In this article, we’ll explore the intricacies of RevShare and whether it is worth working with.
What is RevShare, and for which affiliate programs is it most relevant? Why is it often not recommended for beginner affiliates? Here, you will learn more information about RevShare than you’ll find anywhere else.
What is RevShare – Explained in Simple Terms
RevShare, also known as revenue sharing, is a payment model in which an affiliate earns a percentage of the profits made by the offer’s owner throughout their entire partnership period. Simply put, the affiliate receives a commission for as long as the user they introduced through the affiliate program continues to generate revenue, such as making deposits, purchases, account top-ups, subscription renewals, etc.
What Verticals Use RevShare
RevShare is most popular in the following verticals:
- Gambling: This niche includes casinos, slots, roulette, and various other gambling games, including table and card games.
- Betting: Offers from bookmakers featuring bets on sports, esports, and other significant global events.
- Gaming: Especially in sub-verticals like iGaming and XGames, focused on adult traffic.
- Dating: In this online dating vertical, webmasters receive a percentage of the dating resource’s revenue, which includes subscription fees, premium accounts, and additional features.
RevShare is less commonly used in these verticals:
- Finance: Offers from financial brokers, loans, insurance companies, and microloans.
- Essays: A vertical focusing on online courses, educational projects, and resources for ordering essays, term papers, and test papers.
- E-commerce: Dedicated to online shopping and other commercial online transactions.
The RevShare model is most commonly found in online casino affiliate programs. RevShare appears to be a mutually beneficial scheme: the advertiser acquires active players, while the affiliate enjoys long-term passive income and motivation to drive more quality traffic. However, its essence is often misunderstood.
For example, consider an affiliate who joins an online casino offer with a 50% RevShare payout. A player clicks on the affiliate’s link, makes a deposit of $100, and loses the entire amount. After accounting for casino service costs, the casino’s net profit from this client isn’t $100 but $80. Therefore, the affiliate earns a $40 commission. Now, imagine the same player deposits another $100, wins, and withdraws $50. In this scenario, the casino’s revenue is only $50, and the net profit is $30. The affiliate’s 50% share of this profit is $15.
Of course, the earnings from a single fortunate or minimally active player might not be particularly inspiring in a RevShare model. However, if you attract a large number of solvent and long-term players, the revenue can be quite substantial. It’s important to understand what RevShare truly represents – it is a commission not on the player’s deposit but on the amount they lose. This means if a person regularly deposits and tends to win more often, your earnings will decrease in tandem with the online casino’s losses. Before committing to RevShare with a direct advertiser or an affiliate network, it’s important to clarify the percentage they are willing to pay for active players.
Affiliates encounter two main types of RevShare: fixed and dynamic. The fixed RevShare model is straightforward – the percentage remains constant throughout the entire period of partnership.
Dynamic RevShare, also known as the “ladder” system, is more intricate. Here, the percentage varies based on the number of players and the company’s income from these players over a specific period. This means that the RevShare partner can either increase or decrease the commission for affiliates. This adjustment could be due to factors like low-quality traffic or a lack of repeat sales. For instance, if an online casino generates up to $100 in net revenue from a customer, the affiliate earns 30% on RevShare. Should the customer lose up to $300, the affiliate’s share increases to 35%.
Any affiliate might rationalize the use of dynamic RevShare, citing it as a means to boost the motivation and productivity of partners. However, the “laddering” approach is generally not well-received within the community, with a preference for fixed rates for evident reasons. Affiliates could lose their traffic sources, and for networks or advertisers, it becomes a convenient excuse to reduce payments or not pay at all.
How to Work Properly with the RevShare Model
Targeting a quality audience in order to succeed in media buying using the RevShare model is highly important. This group doesn’t consist of people who deposit once out of curiosity and never return, nor does it include gambling addicts who quickly lose everything. Instead, the ideal audience for adult offers with RevShare consists of regular gambling users, professional players, and ordinary people who play for fun—those who provide steady, long-term profits to the casino. This means strategically selecting traffic sources for effective media buying under the RevShare model.
Regarding gambling, active players can be attracted from:
- Own websites and online platforms tailored for specific queries (doorways).
- Telegram channels focused on strategies for earning money in online casinos and forecasts for sporting events.
- Thematic forums and communities where professional players share their experiences.
- Social networks host a vast and diverse audience; finding new players here requires knowing how to navigate moderation.
- Advertising networks specializing in traffic for gambling, betting, gaming, and other, more adult verticals.
Cons of Working with RevShare
Like any pricing model in affiliate marketing, RevShare has its own pros and cons. While RevShare can indeed generate substantial income, it’s important for webmasters to be aware of certain challenges before committing to this model:
- Investments might not yield immediate returns; it could take several months to see profits.
- The affiliate marketer risks incurring losses if the leads win more frequently than they lose.
- The affiliate earns a commission as long as the lead is active, but eventually, every player stops playing (and the affiliate might also close their operation).
These drawbacks can be intimidating, especially for beginner media buyers. However, those focusing on high-quality traffic generally have less to worry about.
How Not to Lose Money on RevShare
Here are some recommendations to help you avoid losses when working with RevShare and navigate the process with greater confidence:
- Diversify Your Income Sources by spreading your traffic across multiple affiliate programs or Smartlinks. This way, if one program underperforms or closes during a reporting period, the others can potentially offset the loss.
- Each casino has what’s known as an admin fee, which includes commissions for providers and administrative and transaction costs. These expenses are typically listed in the documentation. Make sure you understand the formula used to calculate the commission for each affiliate program.
- Choose RevShare affiliate programs that don’t carry over a negative balance and where each reporting period starts from zero.
RevShare can be zeroed or non-zeroed. For instance, if a player you referred wins and withdraws a significant amount, this creates a negative balance on your account. This can be compensated by future losses or zeroed out by the offer owner or affiliate network. Experienced webmasters have their own strategies to manage negative RevShare; less experienced ones might pause their campaigns until the account is zeroed.
- Select Affiliates with a Wide Range of Slots and Providers. This ensures that users have plenty of options and don’t leave for another affiliate link in search of their preferred game.
- Before working with an affiliate on RevShare, confirm the frequency and methods of payouts. Payments are typically made once or twice a month and upon request.
Revenue Share or CPA: What to Choose in 2024?
Under the CPA model, the media buyer receives immediate income with minimal risk. In contrast, RevShare is a long-term strategy that can potentially yield much higher returns than CPA.
For those new to affiliate marketing, starting with affiliates that offer payment for a targeted action – like registration, a purchase, or an initial deposit is recommended. However, webmasters with access to high-quality, live traffic should consider the long-term passive income opportunities provided by working on a RevShare or hybrid model (CPA+RevShare). Simply put, it’s important to be realistic and pursue RevShare only if you are confident in your traffic quality. Affiliates highly value traffic where players repeatedly return and make deposits.
We’ve thoroughly examined how to work effectively with RevShare. As you might have realized, this payment model makes income prediction challenging, and results can’t be assessed as quickly as one might like. Your profit is more likely to be in circulation rather than immediately available. Even with an understanding of RevShare principles, there’s a risk of losing everything at once. When choosing a RevShare partner, verifying that the payment aligns with the stated formula is recommended, at least initially.
If you lack a substantial financial reserve or prefer to source traffic for free, then a CPA network is your best option. Lospollos, for instance, offers effective Smartlinks for various verticals, a transparent system, weekly payments, and no holding period.