TravelerMSY

Mr. M made a big splash about turning down 4k/month from Chase by not censoring his title. He conveniently neglects to mention what he didn't turn down from Citi, Amex, Barclays and BlueHost.

But again, who cares? Go start your own if you're jealous, or just don't click on it if you're outraged.

ma91pmh

I'm neither jealous or enraged... just not buying the public hero story he published on his site that's all

gpapadop

Sooooooo...

We still need definitive answers to:

1) Who gains/loses in the manufactured spending activity?

2) Banks--->Affiliate Companies----> Bloggers: What is a typical cut for a typical blogger by the affiliate companies. I understand each affiliate company is different and the higher traffic bloggers get higher percentages.

Would love to know these elusive answers

nsx

I haven't figured out how banks make money handing out over $500 worth of miles for a single new credit card. I also don't know how Southwest figures it's making money handing out Companion Passes to every FTer who can put together two 50k credit card bonuses and a little spending. But I know these companies do believe it's working for them.

TravelerMSY

They look at how they're doing on average, not by the people like us that are gaming it. 18% interest plus late fees pays for a *lot* of marketing.

TravelerMSY

The silence on blogger compensation, plus the fact that many of them quit decent jobs or didn't look for jobs out of college leads me to believe the compensation is pretty lucrative. Keep in mind they can plow some of their earnings back into advertising to bring more traffic to their site.

The real indicator is the fact that the most senior, useful blogger finally put up the links too. If a guy who already has a good job and side business is wowed by the affiliate compensation, it's gotta be a lot.

I don't mean this to be a criticism. I'm happy they exist, and happy for them to be making money at it. Maybe a little jealous I guess. Everyone who wastes time on FT or MP probably wishes they could be getting paid for it.

brooklynmatt

Thanks, but I have always had links up, nothing changed.

Don't think of it so much as the lure of money, rather the lure of monetization for the purpose of lifestyle change. A good job in the rat race vs living the life you want.

It isn't easy, but can be done, the hardest thing is finding your voice in a world filled with people yabbering on about the same stuff.

brooklynmatt

This was answered in another thread here very recently, the range for a card goes from $20-50 on the low to $300 on the High (Amex Plat and Gold) for the blogger, you can assume that the Affiliate companies make something close to that too, not sure of the slice they take.

Also, some very high traffic sites, like boardingarea, have direct bank links, where Chase will buy say 3M pageviews and boardingarea will put the links up, the bloggers there will share the revenue (even the good guys who don't hawk cards). An example of that link is the United card you see pasted all over their site. Not many sites have the clout to cut out the affiliate middleman, but they do due to their overall high pageviews.

Revenue for those is pay per click, similar to Adsense, at a higher CPC and split between the network and the blogger. Competitor networks have similar programs but the revenue share is a little different in each one.

nsx

But: the banks are paying bloggers who are obviously bringing in ONLY GAMERS. That makes no sense. Blogs whose focus is gaming credit cards should naturally be excluded from being compensated from the banks unless the banks are insane.

kokonutz

Yes, this is the queerest part of the blog business model.

Credit card companies are paying a lot of money to specifically target gamers through gamer bloggers.

I guess they hope that a large percentage of the gamers will be really bad at the churning game and will end up carrying a balance at 19% or keeping the card and paying an annual fee.

OR, perhaps there is value in simple numbers: telling your shareholders that you got more customers gives them more confidence whether those are profitable customers or unprofitable customers???????????

brooklynmatt

Actually true gamers aren't so attached to a blog for referrals as they are savvy enough to shop around for grey market links to get a better signup bonus.

The blogs target newbies and people with light experience who are quite likely to not game the system and be profitable for the card company.

tlott

The affiliate networks actually make substantially less than that. If the network gets paid $400 per lead/sale for product X, they will likely have a base payout for their affiliates of maybe $300 (25% margin for the network). Depending on a particular affiliate's relationship with the network (history, how much volume they do, etc), their payout will probably be bumped up, reducing the margin that the affiliate network gets to keep. If an affiliate is pushing particularly good quality, they might be able to negotiate an even higher payout from the advertiser.

Agreed. If the blogs were only generating low quality "gamer" applications, they would NOT still be on the offer. There is usually an initial quality check of some sort a week or two after an affiliate starts sending traffic... poor quality affiliates are booted real quick as there is a lot of fraud in the industry (fake applications from stolen identities).

lwildernorva

Two things seem to be at work here. First, CC companies are using churners for their own purposes. Quarterly results can be made to look pretty sweet when you have a high number of new credit card apps. Some executive bonuses might even be tied to that number, and I suspect that was especially true when the Chase-Amex war was really heating up.

Second, if you're looking to increase your credit card apps, it helps to mine a rich vein. There's no doubt that travel bloggers have an audience likely predisposed to making multiple credit card apps--exactly the kind of audience a bank pushing credit cards is looking for. Given that most Americans don't make the number of credit card apps the average FTer does and that during the recession, the average American probably reduced even further the number of apps made, is there any wonder that blogs can be seen as a worthwhile outlet for pushing credit cards?

Maybe this approach won't result in high profits for the banks in the long run, but American business has seemingly run on a short-term model for over 30 years now. Quarterly profits, not loyal, long-term customers, are the primary driver now.

ma91pmh

Y'all are seriously mistaken if you think the blogs aren't bringing in profitable customers. The gamers are a real small niche of it

brooklynmatt

Yep, in fact the bloggers copy the content from the gamers for the most part, and then attach an affiliate link to it.