There is no simple answer to this question. The main reason is there is no governing body to regulate financial reporting. More importantly, with different billing methods and the nature of a third-party credit card processor, even companies like Epoch or CCBill cannot provide an accurate answer.
With cascading billing systems and the number of affiliate programs using merchant accounts, this added dimension further complicates the equation. In turn, even Visa could not give an accurate answer, due to other payment options and international billing methods.
So reporting revenue or profit to determine who is the "biggest" would only be applicable to publicly traded companies that compete in our industry. Yet annual reports arguably are skewed for the interest of the shareholder, rather than the health of a company. Needless to say, since the majority of affiliate programs in the adult arena are privately owned, that point is irrelevant for our discussions.
Logistically, the definition of an affiliate program encompasses a variety of business models such monthly subscriptions, live cams, online dating, video on demand and unlimited downloading. Therefore, determining which affiliate program is the biggest would have to be done by category.
My expertise is in the monthly-subscription model. To hypothesize which affiliate program is the biggest in this market segment would be challenging because of the differences in the companies' operation, management vision and risk tolerance.
If a company has the ability to accept webmasters who are email marketers, it has the clear advantage of having a larger webmaster base to solicit. If an affiliate program solely chooses the partnership model, rather than the pay-per-sign-up model, there are clear distinctions in its philosophy toward membership retention. If an affiliate program has multiple business models that filter significant amounts of traffic to a single pay-site program, the difference in resources would be evident in how the company harnesses traffic and sign-ups. Ultimately, these internal decisions modify the ability to compete and compare with equal benchmarks.
In discussions with several industry experts, daily sign-ups emerged as a typical gauge in hypothesizing which program may be the biggest. But how does one account for premium features or cross-sales that many third-party credit card processors and merchant accounts offer to affiliate programs? Choosing to use cross-sales illustrates a company's risk-management philosophy in relation to charge-backs and credit card regulations.
Similarly, if a company chooses to reciprocate traffic via affiliate partner trades or simply keeps all traffic within its internal network, the decision relates to a very different perspective of the value of relationships.
And there are a number of very strong single-site, gay and niche-specific affiliate programs that count on membership retention and exclusive content to drive their profit margins. One can argue that daily sign-ups are not the best gauge of those programs' success. Yet we can't exclude this business model in our discussions, as the abundance of free content on the Internet allows these affiliate programs to become strong market contenders and effectively compete with a high-quality product.
Having said this, there is no clear indicator for making a confident claim about which is the single biggest affiliate program. There are a number of characteristics and metrics that we have not addressed. The values of innovation, longevity, site variety, differentiation in webmaster tools, and conversion performance are characteristics that cannot be ignored in this argument. But it is unrealistic to have all affiliate programs share identical characteristics in suggesting comparisons.
Lastly, marketing and branding efforts are diverse in nature. If a company has a consistent branding campaign, large presence on trade-show floors, consistent event sponsorships, several account managers, strong board personalities and effective public-relations campaigns, is it possible build a false sense of the company's actual size, profits or success? Our perceptions are skewed by how we receive sophisticated marketing campaigns, yet we all can agree there are benefits to a strong brand in our marketplace.
There can't be a precise apples-versus-apples comparison of companies because there are several companies that have multiple and diverse business dimensions. An affiliate program's decision to conservatively operate under the radar is just as effective as that of an aggressive market leader and early adopter that may invest in high-risk initiatives. The bottom line of profitability throughout a company's life span is affected by changing demands of the market and adjustments in personnel. So the time frame is another variable to consider in distinguishing the biggest program.
This commentary is opinion-based, but I confident that being the biggest program isn't nearly as important as profitability and providing the highest quality of life to the entrepreneurs, their families and their team members. Success is not a destination based on revenue or sign-ups; it is the journey itself. So how does SilverCash.com compare? I'm not really sure. I'm just blessed to have a Silver lining in my journey.
-Albert Lazarito is the vice president of business development and operations for SilverCash.
This article initially appeared in the May 2008 edition of AVN Online. To subscribe, visit AVNMediaNetwork.com/subscriptions.
