How Auction Ads Makes Money

There have been a lot of questions about "AuctionAds". On the surface it seems too good to be true. How can they serve ads for you and pay out your complete commission? Well, this is all because of a sliding commission scale. If you sign up for your own personal eBay account then you will see the following scale.

Sales

50%: $0 - $99.99
55%: $100.00 - $4,999.99
60%: $5,000.00 - $199,999.99
65%: $200,000.00 - $699,999.99
70%: $700,000.00 - $2,999,999.99
75%: $3,000,000.00​

Signups

$25: 1 - 49
$28: 50 - 1,999
$31: 2,000 - 29,999
$35: 30,000 +​

So if you sell $1,000 worth of merchandise and have 3 signups you make 55% of the commission EBay made from the $1,000 in sales. So lets say 55% of 5% of $1,000 or $27.50 as well as $25 * 3 ($75) from signing up new users. You would get paid $102.50 that month.

That is not too bad. However Auction Ads is making a lot more than this. Auction ads now has over 17,000 people using it. If the average is $1,000 in sales and 3 signups then Auction Ads will have $17 Million in sales and 51,000 new signups. $17,000,000 * .05 (commision) * .75 (Sales Percentage) = $637,500 earned. They Pay $17,000,000 * .05 * .55 = $467,500 for commisions. The 51,000 signups make 51,000 * $35 or $1,785,000. They pay 51,000 * $25 or $1,275,000.

Not counting operating costs of course, Auction Ads makes $637,500 + 1,785,000 - 467,500 - 1,275,000 or $680,000 for one month.

You may think that this equates to losing out on $40 a month ($142.50 vs $102.50). You would not have been able to make that $102.50 if you did not use their system. This is because you would not convert nearly as much if your ad was non-dynamic and did not offer a photo. So you get a lot out of this! Also you would make $102.50 if you used eBay's affiliate program rather than auction ads.

Will eBay get mad at AuctionAds? No way! They will have more sales and new members than with just their affiliate program alone. Also eBay owns PayPal and AuctionAds pays their members via PayPal so they get a percentage of what AuctionAds pays to its users.

The only thing that I would like to see for AuctionAds is for them to get rid of the 6 month limitation for Auction Ad referals. Currently you get 2% of a referal's profit for just 6 months if they signed up from your ad. I would be A LOT MORE motivated if it was 2% for life!

I am posting this as well on my blog
How Auction Ads Works Post

 

great posting. i have something in store for shoe.

 

Great post
The only thing you need to make good money is traffic, loads of it

 

Has anyone else noticed that they are getting paid $24.50 for their new signups? I suppose that it isn't actually a new signup, but given that I only have two days out of 30 to break $15, and both of those days are exactly $24.50, I am assuming that its two new signups on those days.

 

It would be easy enough to setup your own dynamic Auction Ads like ad units. You just use ebays API to query and cache the results, and serve the cached information.

However Auction Ads has other reasons on why they are much better than CJ.

 

Indeed! It is easier to get included in AuctionAds and their reporting is much simpler.

Although, everybody might not be as smart as Munja who can whip out Ebay API programs so easily! Of course I AM as smart as Munja, but we can't expect everybody else to be

 

I have one of those ebay most viewed and bid on items websites, it basically has a java script that shows all the items from ebay on my website. Anyone know how to convert each link that shows up on my website so that it automatically coverts the ebay links over to the auctionads linking back to the ebay items? Hope someone understands what im talking about.

 

I second the motion Allen! There actually loads of programs that you can earn if you have a site and have a good traffic! I'll say the possibilities are endless... But still the Million dollar question falls on to; "How will you drive traffic to your site!

 

Aren't there strict rules in the TOS about caching? Or am I mixing this up with Amazon's API?

 

I remember that about Amazon. It was a rule but certainly not a strict rule. Basically they just didn't want you using all of their resources. That may actually have been removed from the TOS. I doubt eBay will enforce that rule even if it is in their TOS.