So I have an affiliate who has signed up under me. I receive 3% of his total commissions.
To date he has earned me a total of $477.
My question is how do I calculate his earnings?
I used to know how to do this, but have forgotten
Say you had 100000 page impressions for the affiliate page
Say your CTR was 25% and conversion rate reported was 1%
That makes it 25,000 click throughs to the affiliate site out of which 250 made a purchase the merchant reported
For these 250 sales of a product that sells at $100 the total revenue would be $25,000 and your 3% cut makes you $750
Yet the only figure that you know to be true is the 25% CTR or 25,000 leads, you have no way of knowing whether only 1% of such leads converted to sales. That conversion rate may have in fact been 10% in reality thus short changing you in the amounts of (25,000 x 0.1) x 100 x 0.03 - $750 = $7500 - $750 = $6,750 (that should been in your pocket are sitting in the safe account of the merchant)
There are lies, damn lies and there are statistics
I only wanted to point out that there is no way of telling the exact amount of sales revenue as reporting of any sales data to its affiliate members can be any thing other than what is reported
For a while I had displayed ads on my sites through a prominent inline ads company and when my revenue had dropped and I wanted to exit the program, the support person from the ad company asked me to stay around as they will increase my eCPM at their end so the revenue will go up in the following month
So when you have a controlled variable in this case eCPM then you can decide to either lower it or up it. Thus the saying goes "to succeed in business you have to build the odds in your favor"
How else do you think the gambling outlets and the State lottery numbers can afford to pay out high prizes. Someone once examined the Lotto system in State of New York and arrived at the conclusion "Numbers are Set" or how else would you explain every ticket I bought on which the numbers were selected at random by the computer was a winning ticket