Affiliate Marketing Dirty Little Secret II
Thanks to King Zac Johnson for mentioning me in his blog, quite happy that people are reading and paying attention to the changes in the industry as a whole. After my articles, several bloggers started covering more the topic of the financial problems occurring in the industry, and the possible side effects. My articles had such an impact on the industry, that one company even started taking out email blasts in other publications to explain their defend their recent changes. I’m not going as far to claim that specific company is having issues, or that they are in financial trouble, but their situation is part of an overwhelming change in the industry. I think its important to go a little more in depth about some of the issues and discuss them – because they will affect companies even outside the affiliate game.
First of all, the entire continuity market, as explained, is in the tubes. There are a few legit companies and brand companies that continue to play in the continuity market, but the overwhelming amount of Acai and Teeth Whitening companies have gone out of business, or are on the virge of going out of business. Most of them, as mentioned a few weeks ago, lost their credit card processors and had to apply with other credit card processors. Many of them were not paid by the credit card processors for suspicion of fraud, and their payments are being held for as much as 6 months. Those that found other credit card processors have started to be kicked off those processors, plus as new accounts are also having their finances held for several months.
How does this affect the entire industry? When you go even to MSNBC and other major news sites, you will see often links for ACAI and other products via PPC programs such as Pulse360. While its not as predominate as it was a few months ago, still enormous amounts of revenue are being created from these direct response products. Somewhere along the line, there are going to be problems. Yes, MSNBC will not be affected by these problems – however the companies involved could suffer enormously. Remember, between the actual product and the ads, there are often many steps in between. The product is marketed via an affiliate network, which goes to an affiliate, who then most often arbitrages it on these PPC ad networks with prepaid credit card funds. What happens to those affiliates, when they aren’t paid? They find themselves holding the bag, find themselves left out in the wind. On top of that, because of their contracts, they have little or no recourse.
Whether or not the display industry wants to admit it, these type of offers have been filling the blanks for the last two years. While all the major ad networks promote a brand-centric policy, and even the exchanges claim to be moving towards that, when over 50% of the advertising is left unsold, they have nowhere to turn except direct response. I obviously love that – it’s my job to get them to run CPA based advertising, and always seeking new networks to work with. However, some of them are starting to have millions and millions owed to them by affiliate programs that never went through the normal credit process, the normal procedures. Except the few major ad networks out there, many many ad networks are always in a cash crunch as it is; they get paid net 90 from the agencies and brand companies, if not more, and they have to pay their websites net 30-Net 60. Imagine what is going to happen when affiliate companies pay them net never?
One Response to “Affiliate Marketing Dirty Little Secret II”
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Same old shit. There are no dirty secrets. Everyone in this chain knows that the continuity, acai and teeth whitening stuff were SCAMS. Now the quiz mobile offers are flying high. This is bullshit. You should be ashamed running this garbage. Someone need to hold the mobile providers (AT&T, Verizon, etc.) accountable for profiting from this.
You mention MSNBC and the larger publishers. They knew these ads looked awful on their pages and that they preyed on unsuspecting consumers. Shame on them, but shame on the affiliate networks who spread this garbage like herpies.
Here’s a tip. Take some time and read up on some basic marketing principles. The majority of people in affiliate marketing are looking for the quick buck. We all know that you yourself operate this way Pace. For this reason, you deserve to get bent over in regards to these scam offers. You’re not losing money when you don’t get paid because you never deserved to be paid in the first place. You knew they were scams. Do the right thing and walk away from scams in the first place. If you make all your money distributing acai, teeth whitening and continuity programs you are scum.
Go to Affiliate Summit. While the people who organize it are tremendous, most attendees are just not smart people. Walking around with tshirts that say "I need diet offers" is both not cool, nor impressive. You are a loser. They know nothing about actual marketing. They have no skin in the game. Taking a deal and placing a link where-ever you can to make a small margin on an offer is bullshit.
Take some time.. learn to sell. Add value to the world of Internet advertising instead of ruining it for people who know what they are doing. The day is coming very soon where marketers who own offers, publishers and search engines will take steps to eradicate these affiliate middlemen losers from this business. I cannot wait for the day to come.