High payout thresholds are common in many affiliate programs, and for good reason. Although many new affiliate marketers resent the high payouts, there really are reasons for them besides the owner of the company not wanting to pay you. Learn all about affiliate program payout threshold - pros and cons and make your own decision whether you want to sell products for a company that uses this tactic.
There are a number of reasons for a high payout threshold. Making fewer payments results in less paperwork and lower payment processing fees. However, the main reason that affiliate programs require high minimum payment amounts is to protect affiliates from regular customers who sign up just to save money on the product. If the minimum payment is high, these people won't bother trying to cheat the affiliate out of the sale because they know they will never get their money back.
By making the minimum payment higher than the amount that would be earned as the commission from one sale, the program manager can drastically reduce the number of fraudulent purchases by people who just want to save a few bucks. However, when there is too large a difference between the per sale commission amount and the affiliate payment threshold you run the risk of never making enough sales to receive your payment.
Some program managers set their minimum payout so high that it takes several sales to receive a check. If it takes more than a few sales to get your money, you have to evaluate the odds of your making enough sales to receive your commissions. If you have to make ten sales to qualify for a payment, you might want to reconsider selling that company's product and choose one that is more likely to result in a payment.
One way to reduce the risk of having a little bit of money in accounts here and there but not enough to receive payment is to sign up with an affiliate program that offers a wide range of products. If you have hundreds or even thousands of products to choose from, it will be much easier to reach the affiliate payout threshold. If one product doesn't sell well, you can try promoting something else.
When you sign up for a program, look for information on the website telling potential affiliates that commissions are not paid for their own purchases and that checks are in place to make sure that the sales are valid. This type of warning will help keep the commission thieves at bay. Combined with a high enough payment threshold, you can be sure that you will get the commissions that are coming to you, provided you reach the affiliate payment threshold.
