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How to determine your Partner Payout

Your partner payout is the commission you agree to pay a partner when they successfully convert a customer on your campaign. You can think of it as similar to a cost-per-acquisition (CPA) model brands pay to acquire new customers on platforms like Facebook, Instagram or TikTok. But in this instance, instead of paying that amount to the platforms, you pay it directly to your partner who is helping you successfully reach their audiences.

How Do I Determine My Partner Payout?

There is no perfect formula to determine your partner's payout. This is because most brands have completely different types of products, price points, business models, and expectations. If a perfect payout exists, it is innate to you. We can only provide guidance, not rules.

The fundamental question to consider is: what are your goals? Are you looking to add small incremental growth, launch into new channels, or blow the roof off of your sales targets? A higher CPA is typically correlated with more partner interest and sales volume, but the overall performance (ie. conversion rate) of your campaign is equally important for retaining and growing partnerships.

Consider a few of the scenarios below to see this in more depth:

Volume Expectations	Brand Profitability	Ideal Partner Types	CVR Rate Expectations
Low (< 25 sales/day)	High	Brand Ambassador, Micro-Influencer	Low
Medium (< 100 sales/day)	Medium	Publisher, Influencer	Medium
High (< 250 sales/day)	Low	Publisher, Influencer, Paid Media Buyer	High
Hyper-growth (250+ sales/day)	Long-tail through LTV	All	Medium

It can be difficult to price exactly right out the door, but also keep in mind that it’s typically easier to negotiate with partners once they’ve already experimented with your campaign. For that reason, most brands tend to choose a launch payout on the higher side, and re-evaluate after 50-100 orders are generated. With some real-world sales data on hand, it’s possible to examine the quality of customers being generated and decide if an updated payout is needed. While having an attractive launch payout is a great asset, there is no need to stress if you pick the wrong number - you can modify your payouts at any time in the ‘Partners’ tab!

What Variables to Consider When Determining Your Partner Payout?

1. Lifetime value (LTV)

Arguably, LTV is the single best metric you can use to inform your partner's payout. It reveals, on average, how valuable an acquired customer is to your business. By managing and optimizing your business around LTV, you can feel more certain that the upfront cost of a higher partner payout is worth the yield that the new customer will bring in over time. If you have the systems in place to track this, you will have a huge competitive advantage in being able to offer high-value (but profitable!) payouts and attract the best partners to scale your program. If you don’t have insight into LTV, you can approximate using CAC and AOV instead.

2. Cost-to-acquire customers (CAC)

If you are already paying to acquire customers, then your internal acquisition costs are a great leading indicator of what a suitable partner payout could be. Keep in mind that internal costs typically underestimate the cost reductions provided by organic visitors and repeat purchasers by 20% or more. Paid media buyers currently make up over half of the Jumbleberry partner ecosystem, and they’re targeting cold audiences. If you’re buying on Facebook internally and seeing average acquisition costs around $60, then the chance of a partner doing the same for $30 is extremely low. If a partner wants to run in a paid channel that you haven’t tried before, you can reach out to them via Messenger and ask what their typical acquisition costs are to see if there’s a mutually acceptable payout.

3. Average Order Value (AOV)

If your campaign attracts mostly one-time customers, then Average Order Value is a strong direct signal of what you can afford to acquire a new customer. Under such a model, earning a small but consistent profit per average sale is a great way to safely grow. On the other hand, if you have strong customer retention and repeat purchasers, then AOV does not provide sufficient context into the value of a customer and you should use lifetime value instead.

Tip

You can view the AOV for each of your partners using Insights.

Partner Payout Considerations:

There are two important factors to consider when determining how to set your Partner payout. They are relatively easy to track and should be routinely considered when determining the Return on Investment (ROI) of your partnership program. They are:

Lead Generation

One of the best features of a commission-per-sale model is that you only pay when a customer purchases your product. Our data shows that brands monetize an average of 17-20% of the cart abandonment (leads) originated by affiliates. Focused brands understand how valuable this data is and will commit a resource internally to execute weekly promotional email, SMS or live agent outreach promotions to convert affiliate leads into customers. At the very least, we would highly recommend that you send out between 2-3 abandon cart emails per week that offer an increasingly better incentive with each email to persuade prospects back to your website to purchase your products.

The Halo Effect

They say “all ships rise in the tide”, and this is very much true in partner marketing. While your payout is only awarded to partners for direct acquisitions, your brand benefits indirectly from all of the new awareness that these campaigns produce. The other “ships” here are all the other channels in which you operate, be it your organic storefront, your Amazon store, or your SEO & paid search efforts. Jumbleberry advertisers report that they see an average of 22-25% channel lift on Amazon and Search when their partner programs are actively generating sales.

Frequently Asked Questions

Why do you use a payout fixed $ per sale model vs a % of sale model?

Most affiliate networks use a % of sale model. Mostly because these networks attract lower quality partner sources that result in lower quality customers. Jumbleberry attracts high-quality media buyers and publishers that are spending their own budgets to help brands attract new customers. If partners don’t know what their actual payouts are in real-time, they can’t possibly determine if they are profitable based on the CAC they are paying. As a solution that accommodates both parties, Jumbleberry uses a fixed $ per sale model. Using Jumbleberry’s reporting dashboard, brands in real-time can determine if the payouts justify the commission they are paying and can always adjust those payouts to ensure profitability.

Will partners pause the campaign if I lower my payout?

The short answer is, yes or no. If they are still profitable at the lowered payout or deem it worth their time from an opportunity cost standpoint, they will continue to send you sales. If the lowered payout makes the campaign unprofitable for them, then they will likely pause. The recommendation here is to have a dialogue with them! Try and see if there is a payout where both sides can remain profitable to continue the partnership. Are there other incentives you can offer up that may offset the reduced payout? New landing pages, ads or creative assets that can improve campaign performance? Or, bonuses they can unlock for achieving desired milestones? These are all great tactics to discuss with committed partners should a payout decrease be necessary.

Should I set different payouts for different products?

We encourage brands to create multiple unique landing pages for partners to test and direct their traffic to, instead of simply setting up a multitude of product pages that live within your ecommerce store/site. We call these funnels. Think of funnels as microsites you can build to test varying angles, price points, business models etc. When partners have more options to test different landing pages, they can find the one that converts best for their strategy or channel. Brands can win here too, because one funnel may result in customers purchasing more than others. The goal here is to identify the best converting funnel that results in the highest conversion rate for the partner, and the highest profit per customer for a brand. We recommend using one payout across all funnels. Once you determine the optimal funnel that works for both parties, adjust the payout in the Partners tab, where both sides are profitable.

Does my Payout include the Jumbleberry fee?

Jumbleberry does not charge any setup or recurring SaaS platform fees. Jumbleberry’s fee is simply a percentage of total platform spend, which starts at 15% and goes down with scale. For example, if your payout is $60, and partners have generated 300 sales this week then the cost breakdown would be as follows:

Paid to Partners by Jumbleberry: $60 X 300 = $18,000

Fee Paid to Jumbleberry:

15% (base fee tier) of $18,000 = $2700

Please note:

You can unlock % fee discounts based on weekly revenue thresholds that are achieved! The table below indicates how Jumbleberry’s fee is lowered when these thresholds are successfully met.

Weekly Volume	0 - $24,999	$25,000 - $49,999	$50,000 - $99,999	$100,000 - $149,999	$150,000 - $199,999	$200,000+
Service Fee	15.00%	14.50%	14.00%	13.00%	12.00%	11.00%

How often should I change my partner's payout?

You can always adjust your payout as needed, but keep in mind that decreasing a payout requires a notice period and may result in the affected partners deciding not to continue. For this reason, we recommend that if you intend to adjust payouts, you do it with careful consideration, and if possible, prior communication with your partners.

Can I pay partners custom payouts?

Absolutely. If you go to the ‘partners tab’, you create custom payouts for specific partners. Partners that are delivering high-quality customers can be incentivized to scale their budgets or remain committed to your program if they are fairly compensated based on the value they are delivering for your business. Conversely, you can lower payouts if the quality of customers does not justify the commission per sale you are paying them. Lastly, if you are trying to unlock a new channel i.e TikTok that has a high potential for growth, you may want to offer partners a higher commission to successfully commit and prove out the channel for you, to help you diversify your customer acquisition strategy.

How do I set payouts on the platform?

In the context of our platform, the payout (CPA) will encompass the cost per customer acquired to your eCommerce store. In this article, we will walk you through two ways to set payouts: default payouts that are campaign-wide and custom payouts for specific partners.

Here's a quick video to show How to change payouts and add custom payouts for your partners:

Placing Default and Custom Payouts

For your campaigns, you are able to set a default campaign-wide and/or partner-specific payout.

Default (Campaign-wide) Payout

To set a default (campaign-wide) payout, go to your campaign and select the Partners tab. You will be able to see the current “Default Payout” value with the option to modify the value. Once you modify the CPA value, all of your partners on the campaign will have their default payout updated.

Custom (Partner-specific) Payout

Setting the custom (partner-specific) CPA is done in various ways. You can pre-approve a payout value for potential partners under the “Prospect” tab.

If a partner has already applied to a campaign but has not been approved yet, you can pre-approve their payout value in the “Pending” tab.

Lastly, you can make custom updates to approved partners in the "Approved" tab.

Will partners pause the campaign if I lower my payout?

The short answer is, yes or no.

If they are still profitable at the lowered payout or deem it worth their time from an opportunity cost standpoint, they will continue to send you sales. If the lowered payout makes the campaign unprofitable for them, then they will likely pause.

The recommendation here is to have a dialogue with them!

Try and see if there is a payout where both sides can remain profitable to continue the partnership. Are there other incentives you can offer up that may offset the reduced payout? New landing pages, ads or creative assets that can improve campaign performance? Or, bonuses they can unlock for achieving desired milestones? These are all great tactics to discuss with committed partners should a payout decrease be necessary.

Should I set different payouts for different products?

We often get asked the question, "Do different products require different payouts (CPA)?"

When partners have more options to test different landing pages, they can find the one that converts best for their strategy or channel. Brands can win here too, because one funnel may result in customers purchasing more than others.

The goal here is to identify the best converting funnel that results in the highest conversion rate for the partner, and the highest profit per customer for a brand. We recommend using one payout across all funnels. Once you determine the optimal funnel that works for both parties, adjust the payout in the Partners tab, where both sides are profitable.

Can I pay partners custom payouts?

You can absolutely set custom payouts (custom CPA) for different affiliate partners.

Visit the Partners Tab and navigate down to your Approved partners. Select the pencil icon and create a custom payout for the partner(s) of choice.

Click Save and the new payout will go into effect.

Partners that are delivering high-quality customers can be incentivized to scale their budgets or remain committed to your program if they are fairly compensated based on the value they are delivering for your business.

Conversely, you can lower payouts if the quality of customers does not justify the commission per sale you are paying them. Lastly, if you are trying to unlock a new channel i.e TikTok that has a high potential for growth, you may want to offer partners a higher commission to successfully commit and prove out the channel for you, to help you diversify your customer acquisition strategy.

How often should I change my partner's payout?

You can always adjust your payout as needed, but keep in mind that decreasing a payout requires a notice period and may result in the affected partners deciding not to continue.

For this reason, we recommend that if you intend to adjust payouts, you do it with careful consideration, and if possible, prior communication with your partners.

Does my Payout include the Squaredance fee?

Squaredance does not charge any setup or recurring SaaS platform fees. Squaredance’s fee is simply a percentage of total platform spend, which starts at 15% and goes down with scale. For example, if your payout is $60, and partners have generated 300 sales this week then the cost breakdown would be as follows:

Paid to Partners by Jumbleberry: $60 X 300 = $18,000

Fee Paid to Jumbleberry: 15% (base fee tier) of $18,000 = $2700

Please Note

You can unlock % fee discounts based on weekly revenue thresholds that are achieved! The table below indicates how Jumbleberry’s fee is lowered when these thresholds are successfully met.

Weekly Volume	0 - $24,999	$25,000 - $49,999	$50,000 - $99,999	$100,000 - $149,999	$150,000 - $199,999	$200,000+
Service Fee	15.00%	14.50%	14.00%	13.00%	12.00%	11.00%

Why do you use a payout fixed $ per sale model vs a % of sale model?

Most affiliate networks use a % of sale model. Mostly because these networks attract lower quality partner sources that result in lower quality customers.

Jumbleberry attracts high-quality media buyers and publishers that are spending their own budgets to help brands attract new customers. If partners don’t know what their actual payouts are in real-time, they can’t possibly determine if they are profitable based on the CAC they are paying.

As a solution that accommodates both parties, Jumbleberry uses a fixed $ per sale model. Using Jumbleberry’s reporting dashboard, brands in real-time can determine if the payouts justify the commission they are paying and can always adjust those payouts to ensure profitability.

Configure purchase event for a dynamic campaign

Dynamic campaigns provide advertisers with the ability to set CPA dynamically for each transaction. The advertisers can configure the Purchase event in the Purchase pixel of a Dynamic CPA campaign to assign CPA value programmatically.

The value field in the code below can be used to dynamically determine the CPA value when the Purchase pixel is fired.

jumbleberry("track", "Purchase", { transaction_id: "ORDER ID MACRO", order_value: "SUBTOTAL MACRO", value: "DYNAMIC CPA"});

Replace the DYNAMIC CPA string with the CPA value variable. This variable should be in the money format without the currency symbol (0.00).

The value parameter will determine the CPA of the transaction and you can set a percentage amount of this value as a default payout for the campaign using step 3 of the campaign setup wizard.