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SilverCash Nixes Cross-Sales

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Nov 13, 2003 12:00 AM PST    Text size: 
RIVERSIDE, Calif. – As the long-term effects of Visa's new chargeback mandate begin to take a toll on more heavily trafficked adult sites, the rules are quickly changing and many sites are being forced to change procedures in order to remain in good standing with Visa's regulations.

In an attempt to adjust to changing industry demands, SilverCash, owned by Cybertrend Inc., has decided to rescind its cross-sales policy. Effective Nov. 16, the site will no longer be accepting cross-sales from affiliate webmasters.

SilverCash is not alone in its recent change of policy and joins affiliate content providers TopBucks and Platinum Bucks, which have also made similar adjustments to their cross-sales policies to stay in good standing with Visa and to tighten up business practices.

Jason Falk, marketing director for SilverCash, told XBiz that the new rule pertains to cross-sales that other webmasters can send to SilverCash from their sites.

"We were having a lot of chargeback problems," Falk told XBiz. "What we found was that the way our site was being marketed created a problem and in some cases users were getting something different than what they expected. We had no control."

Typically, cross-sales invite high risk referrals. Now that chargebacks are closely measured, unmonitored cross-sales can conceivably bring an adult website one step closer to compromising its status with Visa.

"You can't possibly check every single thing that is coming in," Falk told XBiz. "Doing business that way allows other people to do something a little more deceptive toward the surfer that could end up as a chargeback."

According to Falk, Visa's newly imposed chargeback rules are only part of the reason that SilverCash decided to change its policy. Falk added that the decision was due in part to hunkering down and increasing profitability.

"I know there are people out there who are still actively involved in cross-sales, and if they can keep their chargebacks in line, all the power to them," Quentin Boyer, marketing director for TopBucks, told XBiz. "But I imagine that over time they will come to the same conclusion, that it just isn't viable."

According to Boyer, TopBucks began phasing out its incoming cross-sales in early October. They are still sending out cross-sales, but that is subject to change.

"We stopped the bulk of them some time ago," Boyer told XBiz. "We stopped accepting credit card-based cross-sales and continued accepting check-based sales for a while, but we have since stopped those as well. The conversions were really borderline and we had to question whether it was worth it for our bottom line."

Additionally, Platinum Bucks started phasing out its cross-sales program several months ago to remain in compliance with Visa's new chargeback rules.

According to Dan, co-owner of Platinum Bucks, changing its cross-sales policy on the Platinum site was part of many other internal adjustments the company made in order to comply with Visa.

"We're doing everything we can to increase the quality of the transaction," Dan told XBiz. "We no longer have cross-sales on our join forms."

Until the Nov. 16 cut-off point for SilverCash webmasters, cross-sales will be tracked and credited to client accounts in the usual way.

"With the models changing, you just have to adapt," Falk continued. "Things are becoming more difficult from the top line on down in this business and everyone is just getting a little bit more finite in their business procedures. A lot of us are digging into our business models and seeing what works and what doesn't."

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