For digital businesses, there are many options for generating revenue from a wide variety of income streams, including subscriptions, paid advertising, and affiliate marketing.
By employing - and combining - multiple revenue model examples, businesses can diversify and increase revenue.
The affiliate revenue model example is based on commissions. Essentially you resell items from other retailers on your site. You are then rewarded for driving new customers to the merchant who is selling the item.
The way the affiliate revenue model example plays out is through coded affiliate links. When someone enters a site through an affiliate link, these clicks are tracked, as are any leads and/or sales derived from these clicks.
There are a number of different payment methods within the affiliate model:
- Pay Per Click (PPC) - Affiliate gets paid whenever the affiliate link is clicked.
- Pay Per Impression (PPI) - Affiliate is paid when someone lands on the merchant’s site.
- Pay Per Lead (PPL) - Affiliate is paid when someone clicks on affiliate link and takes an action, e.g. completing a form to generate a new lead.
- Pay Per Sale (PPS) - Affiliate is paid when a sale is made. Affiliate receives a percentage of the cost of that item.
The affiliate revenue model is a popular one because it benefits both the original seller (by extending their reach and generating new sales) and the affiliate (through commissions) by delivering a continued revenue stream. This kind of framework can be successfully applied to a recurring, subscription business.
To learn more about different revenue models, download our free eBook on 7 Ways to Sell Subscriptions.