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For A Few Dollars More

For A Few Dollars More

February 24, 2007
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" The most vocal call it theft; the most pragmatic call it a cost of doing business. "

Get a group of adult webmaster affiliates together to "talk shop" and one of the subjects that is bound to come up is uncompensated affiliate program upsells, where a sponsor makes an unrelated sale to a referred surfer without paying the referring affiliate a commission on the sale.

Sometimes this is because a sponsor program passes traffic it receives from affiliates on to sponsors of its own; sometimes it's because a surfer that joins a paysite then buys a selection of DVDs from that site's affiliated toy store. In any case, the original referrer of the customer isn't compensated for these "add-on" sales.

The problem is that some webmaster affiliates feel that since it is "their" surfer that they are sending to the sponsor, the sponsor should pay them for all sales made to that surfer regardless of source — whether they originated from the sponsor's own program — or as a result of the sponsor sending that surfer to a third party, such as another affiliate program.

A variety of reasonable viewpoints may be presented on this subject, and I have my own views — some of which have been voiced by others, some of which have been overlooked. So to further the discussion, I present the following food for thought:

It's easy to understand the concern of webmasters who after acquiring often hard-earned traffic, have seen it sold by their sponsors to other vendors, without compensation to the webmaster or affiliate for that referral. The most vocal call it theft; the most pragmatic call it a cost of doing business. But what really is the problem?

Some affiliates consider this to be the "loss" of a surfer, but why is this so? If you run a typical affiliate traffic source, such as a TGP/MGP, review site, blog or search engine, then you should be popping all of your sponsor links as new windows — thus never losing a surfer to any site; but merely offering him one particular option as well as several more in case the first offer was a no-sale.

As for what the site you sent the surfer does with that prospect, that's its business. You should only be concerned with how well that sponsor is converting the traffic you send it, not how it does it or what else it does with it. As long as you're getting paid and happy with the amount, then keep using that sponsor. If you can make more with someone else, or are unhappy with how a certain program performs, then it's time for you to move on.

Having said that, there is a big problem when the sponsor an affiliate sends traffic to makes those surfers wade through the Max Cash catalog before seeing the target offer — an exceptionally shady practice that I've seen in the past. This is where the referral is hit with pop-up windows or a full-page ad on entering a website offering competitive offers before the sponsor's own offer. Less egregious is the practice of popping a window under the main window, a so-called pop-under, but this is still an area of concern.

But the bottom line is: Is it necessarily wrong for sponsors to use affiliate traffic for their own purposes without additional compensation?

Far from being motivated by a desire to rip off affiliates, the practice of sponsors trying to upsell and resell affiliate referrals is born of necessity. For example, many affiliates demand unrealistic payout levels and one easy way in which sponsors can provide them without "shaving" is by selling unproductive referrals.

What About Non-buyers?
It's a simple concept: When you look at your sponsor stats and see a conversion ratio of 1:500, you're happy about the sale; but did you ever think about what happened to those 499 other folks who didn't buy? If the sponsor just let these surfers go without trying to make another sale, then shame on them — that's not a very good business strategy.

By popping an exit console on surfers who exit the join page without making a purchase, you have another chance to satisfy their needs and make a sale. If that popup didn't work then perhaps another one might. No luck with that one? Sell the surfer to a traffic broker.

If you as a sponsor can convert 1:500 on your sponsor, and your site converts at 1:500, then you can pretty much pay your affiliates out of what your sponsors pay you, and thus dramatically increase your profitability. This is an easy, direct example, but it outlines how being smart about handling exit traffic can pay off big time.

And it's not just about exit traffic, but about member traffic: Sponsors offer cross-sale deals that do not always compensate referring affiliates and offer upsell areas such as toy stores and VOD with nary a payout to the source of this traffic. Is this wrong? Not if the affiliate was paid for originally referring the member.

What the sponsor does with this member after he's been paid for is the sponsor's business. It's not just member traffic either but ex-members and others who might receive email or other marketing from the sponsor to these affiliate-supplied prospects.

At the end of the day, anything that makes sponsors stronger lengthens the time that they'll be able to pay affiliates, as well as enables their ability to do so, and that makes for an overall benefit to affiliates.

Remember, as an affiliate, you're paid for the traffic that you send based upon the rate you agreed to. If you don't find the deal "fair," then look somewhere else, but don't begrudge a smart operator from maximizing his income. On the other hand, if you're a sponsor, don't cheat affiliates by making competitive offers before the one that's being targeted by your affiliates. Send your own traffic to such a deal.


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