How does adfly remain profitible

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jswag
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How does adfly remain profitible

Postby jswag » Tue Jan 17, 2017 6:53 am

I checked out adfly, and they apparently pay around 10-15 USD per thousand US clicks.

However, when I joined as an advertiser, they are charging me only $5 USD per thousand US traffic clicks?

If they run like that, how do they even remain profitible?

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Xellon
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Re: How does adfly remain profitible

Postby Xellon » Tue Jan 17, 2017 6:09 pm

adfly rewards its publishers by offering 50% of its advertising revenue. Its never a fixed rate which is why the payout rates changes daily.

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Re: How does adfly remain profitible

Postby jswag » Wed Jan 18, 2017 7:33 am

Thanks for the reply Xellon. However, the daily rates of adf.ly (for 1000 clicks - USA) are always above $5 USD - the amount Adf.ly charges its advertisers for 1000 US clicks.
In that case, how does adf.ly manage to stay afloat as a business?

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Re: How does adfly remain profitible

Postby Xellon » Wed Jan 18, 2017 3:13 pm

Hey jswag. For a better answer, you can contact the staff by using this link. I'm not a staff member, just a mod here.

But I can give u an educated guess.

The $5 for advertising doesn't mean that adfly isn't making a huge profit. In fact, the income coming from advertisers is a huge sum from what I understand. $5 will only get you 1k visitors which is not a lot. Most advertisers (like myself) will put in $100 or even $1000 per month and spread the views out if sales are being achieved.

I haven't advertised here in a year but the last time I did, from 1k views, I got about 100 leads and like...... 2 sales? So I spent $5, and gained $40 (my product is only $20). Even if there is a big gap in views, leads and sales, if there is a profit, there is no reason not to advertise (I stopped advertising cause my business didn't do well).

adfly has millions of users (estimating). I say this because according to alexa, adf.ly is ranked around 80 which is more then the traffic Craigslist receives. So the publishers are pretty much advertising and I'm sure a huge number of them don't actually make the minimum withdraw of $5 so a lot of it is free advertising. Some publishers are making 4 figures which means if they are giving half their advertising revenue to publishers, adfly is making in the 7-8 figures. The unique $11 for USA traffic that a publisher receives is simply the calculation done by the computer so that they can give half to their publishers. Also add the$6 from Norway, $5 from canada, the $5 from UK, etc etc as well is part of the calculations from past income.

Again, this is just an educated guess and may not be the answer. Also note that the owner owns more then just adfly

edit*

jswag wrote:Thanks for the reply Xellon. However, the daily rates of adf.ly (for 1000 clicks - USA) are always above $5 USD - the amount Adf.ly charges its advertisers for 1000 US clicks.
In that case, how does adf.ly manage to stay afloat as a business?


Just wanted to elaborate on this here. a calculation where u should pay less for what is charged here isn't exactly accurate. Yes, rates are always above $5. But again, considering that rates are also above $5 for several other countries means you need to look at it from outside the box. check the payout rates, and add up the rates for each country and its probably above $100. So again, you have to consider how much is made per month. If adfly makes say..... $3m in a month, then 1.5m is going to publishers.

3m - 1.5m = 1.5m

1.5m + 3m = 4.5m - 1.5m = 3m

3m + 3m = 6m , 6m - 1.5m = 4.5m

etc etc

Also subtract the amount payed to employees, servers, maintenance, etc. So there is a lot to be gained.

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Re: How does adfly remain profitible

Postby jswag » Thu Jan 19, 2017 8:09 am

Once again, thanks for the swift reply.

So you are saying that the main reason why the $5 adf.ly charges is less than the $11 it pays out (for US clicks) is because some publishers do not make the $5 withdraw limit?

I also don't really understand what you mean with the calculations (from the 2nd line onwards):

1.5m + 3m = 4.5m - 1.5m = 3m
3m + 3m = 6m , 6m - 1.5m = 4.5m

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Re: How does adfly remain profitible

Postby Xellon » Thu Jan 19, 2017 2:28 pm

Again, this is just an educated guess. Feel free to debate if you want xD

jswag wrote:Once again, thanks for the swift reply.

So you are saying that the main reason why the $5 adf.ly charges is less than the $11 it pays out (for US clicks) is because some publishers do not make the $5 withdraw limit?


This is part of the reason. They would do just fine if everyone reached the limit. The reason behind the limit is most likely due to the charges paypal, payza, and payoneer for a business account.

Also, when advertising, there is a priority function. If you increase this, you'll get high priority but your cpm advertising rate increases last I checked. So if you want your ad to mostly display for everyone, advertisers are charged more per click.

As for the calculations:

3m represents how much is received per month (its not actually 3m, this is just a number I picked as an example). 1.5m is half 3m. This is because half the total income received from advertisers is given to publishers. Comes out to equal 1.5m

Next month, they receive another 3m giving them a total of 4.5m.
again, they made 3m, cut it in half is 1.5m. then the total they have - 1.5m = 3m. Keep repeating this calculation and you get nothing but an increase per month (minus company building charges, employee charges, minus server charges, maintenance charges, etc).

Your probably most concerned about payments received from advertisers vs payments sent to publishers. But it seems to be working for them. If they can send out between $0.40 to $10 per 1000 click for X countries, that means they are getting a ton of revenue from advertisers. There are also several things behind the scenes that lower payout rates.

For ex - If a user is under a proxy, even if its USA traffic they won't get the unique view but a proxy view which is quite low sent to publishers. Same for a VPN (I think). Mobile users also have different payout rates.

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Re: How does adfly remain profitible

Postby jswag » Fri Jan 20, 2017 5:19 am

Thanks for the elaborate answer. I think I vaguely get it, but can you please use a set of formulas to explain why you think adfly can accept $5 and pay out $10? I just don't really "get" how that works. Sorry for the hassle, but I would like to have a better idea of how adfly works before I consider using it full-time.

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Re: How does adfly remain profitible

Postby Xellon » Fri Jan 20, 2017 3:32 pm

jswag wrote:but I would like to have a better idea of how adfly works before I consider using it full-time.


I'm going to change the topic real quick. I now understand what your concerns are. If you use something or work for a company and all of a sudden they go down, it would cause a lot of trouble for you. First, let me reassure you and change your perspective.

You should not be using adfly full time. Here is a quote I used for a new user:

My tip is to not focus on adfly. Consider the shortner/entry scripts as extra for something you already built up or plan to build up. For example; lets say you decided to make a.......gallery website where artist can upload their art work and show to the world. If that website does well, you can slap on an adfly script and make extra for every visitor to your site.

Or just another example, a file hosting website (some examples are mega, rapidshare, mediafire). Lets say you made your own and managed to get a lot of traffic to it. You can put a adf.ly banner script to make extra off it.

At best, if you just focus on adfly such as trying to shrink links and manually spam it on facebook and different sites trying to get clicks, you wont get very far. People make blogs about adfly but in the end, it gets no traffic because there are millions of other people who have done the same thing (too much competition).

Here is some info u may find useful about blogging I posted a long time ago - viewtopic.php?f=33&t=18057

Don't forget about the referrals as well. Bringing more people to adfly will earn you income as well.


Now to answer your earlier question about a formula.....you cant really make one if its just an estimate. But what I used was:

x-y=z

x is total amount received from advertisers
y is total amount received from advertisers divided by 2 (giving half to publishers)
z is total amount received from advertisers after giving half to publishers.

then you add z + x because next month, you will still have half from what you gained after giving half to publishers plus the full amount received from advertisers.

jswag wrote:Thanks for the elaborate answer. I think I vaguely get it, but can you please use a set of formulas to explain why you think adfly can accept $5 and pay out $10? I just don't really "get" how that works. Sorry for the hassle


For this to work, you need to forget the idea of accepting 5 and giving out 10 and just focus on the income gained from advertisers. Reason is because there are too many factors that would result in a profit.

I'm going to stop here. If I am right, it means I could possibly be revealing the business model which people could copy easily :) so I won't list some of the possible factors.

Again, this is all an educated guess and I could be wrong. But to ensure you further, know that adfly has been around for about 8-9 years. No business can survive that long if their business model didn't work.

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Re: How does adfly remain profitible

Postby jswag » Sat Jan 21, 2017 4:20 pm

I see. So you are saying that the payout rates are 100% accurate, but are just the average amount paid to publishers who've delivered 1000 clicks for a certain country? In other words, they are past data, and just a projection of how much you might earn per 100 clicks?

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Re: How does adfly remain profitible

Postby Xellon » Sun Jan 22, 2017 3:41 pm

jswag wrote:I see. So you are saying that the payout rates are 100% accurate, but are just the average amount paid to publishers who've delivered 1000 clicks for a certain country? In other words, they are past data, and just a projection of how much you might earn per 100 clicks?


Per 1000 yes. and also, I was informed that my answer isn't incorrect but could be simpler from a staff member :)

I mentioned there are "factors" that result in a profit.

If you create a campaign, you also have the choice to bid for 1st position so your ad can be noticed compared to other advertisers. In this case, its possible that an advertiser will pay up to $20 per 1000 instead of $5. This is 1 reason why profit is made.

The other main reason is looking at the raw views vs unique.

they are looking at the 'unique' payout rate not the
'raw' payout.

An advertiser pays for unique visitors but a publisher can get paid
for up to 6 adverts for per person clicking on the link.

So if one person clicks 6 adverts where the advertiser is paying $5
CPM, that's $15 CPM and 50% of that is $7.50 CPM paid to the
advertiser.

That's why if they want to understand the how the business model
works, they need to look at the raw rate and also understand some
advertisers are paying more than $5 for US traffic.


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