What commission structures have proven most effective for high-ticket, luxury, or premium products?
Topic summary
Commission Approach for Premium Products:
For high-end or luxury items, brands typically use flat commission per order rather than percentage-based structures.
Key Considerations:
- Commission amount should be determined by product price point and profit margins
- Balance is critical: maintain profitability while offering affiliates attractive incentives
- Flat rates provide predictability for both brands and affiliates on high-ticket items
For high end or high price point products, brands typically pay a flat commission per order instead of a percentage of the sale. Deciding what that flat commission offer is should be based on your product price point and margins. You want to ensure you are still making a profit while giving your affiliates an enticing incentive.