Simply put, revenue sharing is the process by which a company or corporation shares or distributes profits to employees, investors or other stakeholders and affiliates. A company experiences quarterly or annual profits and shares that with relevant and qualified individuals or organizations via cash, shares and other benefits. An affiliate – that is, an individual or company – supports and promotes a particular product or brand in exchange for a percentage of each sale or order placed via their link, referral or recommendation.
Commonly used in online advertising, revenue sharing is an effective way to increase revenue for a parent company without shouldering the cost of increased marketing and advertising. The use of social media and blogs in affiliate marketing provides passive income for millions of content creators and managers all over the world.
Amazon, Ebay and ShareASale are all popular providers of affiliate marketing programs. Some blogging and social media professionals make posting and profiting from affiliate links a full-time job; many report earnings of six figures (and more!) annually. Most providers of affiliate services provide graphics and other digital media to make online advertising easy for marketers to use and implement. These graphics include logos, pictures of products formatted for high-quality display and web banners of various sizes and formats to make the posting process quick and convenient.
Email is also a popular method of taking advantage of the benefits of revenue sharing. Many bloggers and online content providers offer email subscription lists, newsletters and other free material that is sent weekly, monthly or sporadically. In these messages are often links to products, services and content that subscribers may find useful or want to share with friends and family. To make sharing these messages easy, productive and more efficient, many emails and other links contain buttons that provide quick ways to post this information on a user’s social media profile.
Whether a person owns stock in a company or works hard to promote its product or service, revenue sharing is a benefit for all parties involved. Sharing revenue is essential to the growth of at-home bloggers, professional ad agencies, Fortune 500 companies and even the governments of many countries with an interest in their nation’s stock exchange(s). In whatever form revenue is paid out, invested or shared, profit is important in measuring success, and sharing that profit in the right way and at the right time helps to create and perpetuate a cycle of benefits for marketers and businesses alike.