December 3, 2008
Truth in Affiliate Marketing
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Recent attention to loyalty and charity affiliates using browser plugins has had me reviewing the different network terms and codes of conduct.
In May of 2007, Commission Junction updated their code of conduct to include a new section for Advertisers, in which there are some great points to consider.
There are several, all of which you should take the time to review, but in light of recent events, this one is my favorite:
Competing Channels, Catalogs, Coupons. Advertisers must fully disclose any conditions or restrictions that would negate publisher commissions. Such conditions may include: use of a coupon code by the end-user, use of a catalog code by the end-user, the status of the end-user as a prior customer, or the end-user contacting the advertiser through a Web site promoted phone number.
It is sort of a dirty little secret that some activities that merchants themselves do can negate affiliate earnings, particularly return days.
For example, if an affiliate refers a visitor and that visitor signs up for a newsletter, that merchant may send that user a newsletter and then give themselves credit for converting that user and not the affiliate who may have otherwise had 30 days to get credit for a sale.
Or a merchant may give special treatment to particular coupon codes where if used, the sale will be credited to a different channel, or another affiliate, and the referring affiliate commission not reported.
And by that same token, how is it that partnering with loyalty sites that have their browser plugins installed on millions of user browsers is not something that should be disclosed in the same manner?
Since the Advertiser section appeared in CJ’s Code of Conduct a year and a half ago, I can’t say that I’ve seen a whole lot of full disclosure appearing anywhere around competing channels.
For merchants that I work with, I want to see this disclosure of channels to where commissions are due to me may be directed elsewhere, including loyalty publishers that use software plugins.
How much commissions that are due to me are being directed elsewhere and why?
I want to see accounting on these commissions that are being directed to other channels. How much am I losing? Is it 1%? 10% 50%?
Is Truth in Affiliate Marketing too much to ask for?
Disclosure would be great as well as paying for all sales an affiliate touches within the cookie window. It is the only marketing channel where the “publisher” gets paid nothing unless they are credited with a sale. Go tell Google or an ad network that you are only going to pay them if you feel like crediting them with a sale that was touched by a number of different ad programs.
Even if there is disclosure that sales attributed to an ad network, say an advertising.com or other behaviorally targeted media, the type of tracking should also be disclosed. View-through conversions are basically the only way to justify spending $$$ on most media programs. If an affiliate sends a visitor and then the visitor falls into the cookie pool of a behavioral network, sees a banner gets a cookie and the media campaign gets credit for the sale (which would be the what the media buyer and ad network would want to see to justify their existence), that doesn't seem quite right.
I've wondered specifically about PriceRunner. CJ's owning a price comparison engine with a totally different price comparison engine opens up a whole new channel for affiliate abuse. VCLK can do all of its funding of parasiteware without the public outcry that happens when they do it directly with CJ.
That will really help a lot to all affiliate marketers. As a newbie, I don't know much about affiliate marketing. This post will certainly help me from being fooled by merchants.
Thank you for posting this very useful article.
I am not able to believe it, that Affiliates can lose 50% and more commissions. Thank you Scott for creating awareness this would really help the Affiliate Marketers to certain extent. Ya, it would be better if the advertiser discloses all the details.
That type of disclosure has been asked for off and on for years now. It's never been met with favorably by networks. I wonder why?
It's been left up to affiliates to research themselves if they really care about it. Easier said than done however for affiliates with the ever changing partnerships.
But if these types of software (not just plugins) are such a value add for merchants, why not have the disclosure? Why would such disclosure be a potential PR problem for a merchant? Would there be such an issue if a merchant disclosed they worked with coupon sites, social media sites, ppc affiliates? I think not.
BTW, good series Scott.
May be CJ has to force the advertiser to track all other goals on the site and give the affiliate some credit for that, news letter is one of them as mentioned by Scott what about the contact us form and phone calls, not mention the brand enhancement.
I couldn't believe it, that Affiliates can lose 50% and more commissions. Thank you Scott for creating awareness this would really help the Affiliate Marketers to certain extent. Ya, it would be better if the advertiser discloses all the details.
maybe a little bit offtopic
but I think CJ should begin to develop itself. CPA is not the deal of the century. They need some changes inside their heads and ideas. A lot of popular webmasters acknowledge that CPA model is going down. So they need to think and propose what the next will be.
Speaking the truth, I think it's becoming harder and harder to me to earn through CJ…
Why would you say that is?
Great Post !
Good one Scott. It is too interesting. I enjoyed your posting.
Truth in Advertising is such an interesting topic, the dilemna is really non-existent these days I find. People are really too smart to fall for gimmicks and lies (at least those with serious disposable income, lol). If you want to deal with the lower end demographic, feel free to use gimmicks. If not, then you probably want to be telling the truth in your advertising.
Ryan Philipenko - Edmonton Real Estate
Great post. Well done!
i know the character mean…. nice post
I am sure there are other loopholes in affilliate comissions as well. I have always been wary of affilliate systems for some reason. At the end of the day we can never have full control over waht happens after a user leaves our site. There can be all sorts of ways in which the final comission can be reduced. For this and otherreason I tend to prefer PPC, CPC or other forms where the payments are more well defined less ambiguous.
Thanks Scott! I'm hoping that articles like this will reform the affiliate market community. Affiliate marketing can be so profitable, it's a shame that some companies are using less than honest tactics.