If you plan on investing in rented referrals there are a few things you'll need to know before you make your investment.
How many referrals will you need to rent?
How much do you need to spend in order to make a profit?
Before you buy up on your next batch of rents, you'll need to do a few calculations first..
Firstly, work out your costs.
I am going to run a scenario using the NeoBux product information. I will review and compare the earning strengths of different sites later.
Lets say Ron creates an account with NeoBux, and after a while checking different sites out decides to upgrade and purchases the Emerald Golden pack. He has paid $290 for an annual subscription. Before we work anything else out, it would be a good idea to know how many clicks he needs to cover the subscription.
The Emerald Account is costing Ron $24.16 a month. Divide this by the cost per referral click (for standard and fixed ads its .01c) and you've got 2416 clicks needed per month.
Now Ron needs to work out what average per day he expects to receive from each of his referrals. If he receives higher averages, the number of referrals he needs would be less, if his averages go low the number of referrals he needs would significantly increase.
To find the minimum daily average Ron needs to find out what the break even average of a single rented referral would be. If Ron rents a single referral for one month, it will cost him 20c. if that single referral doesn't make him at least 20c in that month Ron is making a loss on that referral. If he extends to the maximum 240 days he will make a saving, but Ron wants again to be conservative.
So, Ron works out a single referral costs him .0066 cents a day. If one click is .01 cents, Ron needs at least an average of .66 to cover the cost of the referral.
The calculation to work out what daily average Ron needs is the minimum referral cost average PLUS whatever the difference is to make up the membership. This will vary depending on the number of referrals Ron buys.
If Ron Purchases 100 referrals, he will need to make at least $44.16 a month to break even. To work out the average divide the cost ($44.16 + 24.16) by the cost per click (.01). Then divide by number of days (30) and divide again by number of referrals. The AVG needed 1.47.
If Ron purchases 500 refs, the AVG would be down to .82, and despite the costs obviously being a lot higher (144.16), with the average DOWN, his investment would be much safer. The more rentals Ron purchases, the safer his investment will become.
Important thing to note here:
THE SMALLER THE AMOUNT YOU INVEST THE GREATER THE RISK OF YOU LOSING MONEY.
How many referrals will you need to rent?
How much do you need to spend in order to make a profit?
Before you buy up on your next batch of rents, you'll need to do a few calculations first..
Firstly, work out your costs.
I am going to run a scenario using the NeoBux product information. I will review and compare the earning strengths of different sites later.
Lets say Ron creates an account with NeoBux, and after a while checking different sites out decides to upgrade and purchases the Emerald Golden pack. He has paid $290 for an annual subscription. Before we work anything else out, it would be a good idea to know how many clicks he needs to cover the subscription.
The Emerald Account is costing Ron $24.16 a month. Divide this by the cost per referral click (for standard and fixed ads its .01c) and you've got 2416 clicks needed per month.
Now Ron needs to work out what average per day he expects to receive from each of his referrals. If he receives higher averages, the number of referrals he needs would be less, if his averages go low the number of referrals he needs would significantly increase.
To find the minimum daily average Ron needs to find out what the break even average of a single rented referral would be. If Ron rents a single referral for one month, it will cost him 20c. if that single referral doesn't make him at least 20c in that month Ron is making a loss on that referral. If he extends to the maximum 240 days he will make a saving, but Ron wants again to be conservative.
So, Ron works out a single referral costs him .0066 cents a day. If one click is .01 cents, Ron needs at least an average of .66 to cover the cost of the referral.
The calculation to work out what daily average Ron needs is the minimum referral cost average PLUS whatever the difference is to make up the membership. This will vary depending on the number of referrals Ron buys.
If Ron Purchases 100 referrals, he will need to make at least $44.16 a month to break even. To work out the average divide the cost ($44.16 + 24.16) by the cost per click (.01). Then divide by number of days (30) and divide again by number of referrals. The AVG needed 1.47.
If Ron purchases 500 refs, the AVG would be down to .82, and despite the costs obviously being a lot higher (144.16), with the average DOWN, his investment would be much safer. The more rentals Ron purchases, the safer his investment will become.
Important thing to note here:
THE SMALLER THE AMOUNT YOU INVEST THE GREATER THE RISK OF YOU LOSING MONEY.
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