Why do Product Creators on Digital Affiliate Networks Give Away So Much Profit?

Something you might be asking yourself at some point is...

Why would a digital product creator be willing to give away 75% of their profits to affiliates?

What’s in it for them? To understand this, it’s worth considering the power of scaling up. Sure, they’re only making 25% per sale but if they have 20 affiliates selling 100 copies of their item a day, they’re still going to make far more than any of those individual affiliates. More importantly, they’ll be able to earn much much more than they would selling the product on their own. The more commission the affiliates offer, the more people will come on board (versus other products) and that means they’ll be able to continually scale up their profits. And beyond that, they’re probably still making money from their own marketing activities where they’ll be making 100% per sale. The sales they get from you are all on top of their earnings. Something else that's not always obvious from the "front end" is the upsells they offer on the back end. It's a common tactic on Warrior Plus to offer a long string of upsells and downsells, i.e. when a customer bypasses an upsell offer and is given a lower-priced option. Along that funnel, it's common to give affiliates 100% on the front-end offer that's typically priced from $7-10, then 50% on the next few upsells in the $27-100 range. But often you'll see a final upsell of a high-ticket coaching package in the $497-1000+ range. So while it looks on the front like they're giving a way a lot of profit, on the back end, they may be still making a dozen $500 sales. On other occasions, though... they may actually offer the high-ticket $1000 coaching package at 50% commission as an attractive opportunity for affiliates. What they get in return -- instead of the profit -- is a HUGE buzz, when everyone is promoting them with the hopes of banking those $500 affiliate sales. So their income in that case comes in the form of the huge amount of fame and high praise they're getting from what seems like all corners of the internet... which obviously will pay off enormously in future promotions.

http://thedigitalroamer.com/why-do-product-creators-on-digital-affiliate-networks-give-away-so-much-profit/