Lending Club and Pertuity Direct Seek Affiliates
Affiliate marketing is the practice of paying other people to do your marketing for you. It’s quite common on the web, and P2P lending is no exception. Prosper (whose program is now suspended) and Lending Club have had programs for a while, and now Pertuity Direct has launched their own.
In the beginning, Lending Club had a simple pitch for members: bring your friends and we’ll give you $5. Your friend had to provide a name and email address, and you got $5. Easy money.
Probably a little too easy, because in late 2007, Lending Club changed the rules of their referral program to reward you and your friend $25 if your friend submitted a loan application, or became a lender ($50 if they transferred more than $1,000).
After re-opening their site late last year, Lending Club switched from a home-brewed program to an outsourced program with Commission Junction, and started paying affiliates $35 to $40 per loan application.
Now Lending Club seems to have a new program for existing members that looks a lot like an Amway multi-level marketing scheme. Just invite your friends, and earn $25 when they borrow. Then they invite their friends, and you still earn $15. Then the friends of your friends’ friends join, and you earn $10. In their example, if you invite 5 friends, and they invite 5 friends, and those people invite 5 friends, you earn $1,750. On the lender side, Lending Club pays $50 per new lender. It’s unclear whether they require a minimum amount to be committed, although they must.
Lastly, Lending Club has added a feel-good twist, offering referrers the opportunity to donate their earnings to the charity of their choice. The current list of charities includes the United Way, the American Red Cross, the American Cancer Society, The Nature Conservancy, Habitat for Humanity, the World Wildlife Fund, and Doctors Without Borders.
Pertuity Direct just recently launched their affiliate program, and has a payment structure similar to an earlier Lending Club setup: $35 for each approved borrower application ($40 if >10 per month), and $50 for each new lender application ($60 if >10 per month). The program is set up through Commission Junction.
Since it’s not a true peer to peer lending site (lenders are basically investing in a mutual fund of borrower loans; not choosing borrowers directly or setting rates), Pertuity Direct is probably using Commission Junction because they don’t already have the infrastructure to support payments. CJ is an expensive proposition for advertisers, though. The maintenance fees can eat up between 20-30% of the program’s cost, so if you can roll your own, you can save a lot of money (or pay it out to the publishers). We’re eager to see how these marketing models evolve over time.
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