The roles played by each of the key parties in the affiliate marketing space are very clearly defined. Just like a well-oiled machine, each component has its job to do, each ensuring that the industry as a whole functions, if not in harmony, at least in synergy.
Affiliates should drive value added traffic and consumers to a merchant’s site.
Networks are considered to be the middlemen that track affiliates’ traffic and merchant sales.
Merchants convert that traffic and consumers into sales.
Affiliate managers are there to oil and facilitate the whole process.
Each group enters into relationships with the other parties with the presumption clear boundaries will be maintained. For the most part it works, and each group wants to keep it that way. Affiliates don’t want to see affiliate managers doing their job and merchants don’t want to see networks becoming merchants.
The only potential for crossover is the job of the affiliate manager, as they can exist with the merchant’s organization or within networks or as outsourced program managers. An affiliate manager could certainly boost their personal revenue rather nicely if they started playing all sides of the business,but at the same time they are likely to destroy trust with their affiliate partners.
Trust is the key issue in all of these roles. This complex ecosystem functions because it is based on trust. Trust is not something that people should take lightly or for granted.The presumption of trust exists within each party’s responsibilities, but still, each group needs to earn and continue to foster that trust.
One of the most complex and debated roles in the industry is that of the affiliate network. They are considered to be a trusted third party that is meant to remain neutral and ensure everyone is working in a fair field of play. That’s not an easy task given that there are widely differing opinions on various sides of what constitutes fair play.
Both LinkShare and Commission Junction have previously bought affiliates, and while this has caused concern, it didn’t raise any real alarm bells at the time. And those moves have since faded from the limelight. But let’s face it – many of the larger CPA networks are affiliates that turned into networks,and most still operate as affiliates.
The PepperJam Network has progressed through the affiliate business from merchant,to affiliate, to affiliate managers to affiliate network – presenting them with a serious challenge in how they separate and manage their industry role. The mixed reviews and acceptance PepperJam has received from the affiliate community shows it’s not an easy path to travel. It’s a very difficult journey to take while keeping all constituencies happy. And the larger a company becomes the harder it is to ensure boundaries inside the company are enforced and trust is kept in place.
So it is perplexing when a “Trusted Third Party” network such as LinkShare recently began allowing OneCause, an affiliate, to operate in violation of its’ own terms and conditions, overwriting affiliate codes without a consumer action and targeting direct-to-site traffic from organic search results.
What makes this even more upsetting to the delicate balance of affiliate marketing trust is that OneCause is owned by Rakuten, LinkShare’s parent company.
The industry has long argued whether BHOs (Browser Help Objects) should be part of the affiliate channel and how they should interact with the consumer. That debate continues to rage on. But the real question here is, why is LinkShare (or any network) now operating as an affiliate?
Extensive tests by members of the affiliate community showed that, not only is the LinkShare-owned BHO failing to follow LinkShare’s own Terms and Conditions, but it is also going beyond other BHOs, such as the ones from affiliate eBates, and overwriting affiliate tracking that is meant to be protected by the industry standard afsrc=1 code. This means LinkShare is being credited for commissions that should have gone to its own affiliates. It is wrong on all levels.
LinkShare wrote in its blog that the issues were immediately addressed, but continued testing shows the same results as prior to the fix.
LinkShare isn’t the first to do this, but as the company likes to state, it is a market leader. So, why is one of the three largest U.S. affiliate networks seemingly going out of its way to cannibalize its own affiliate base? In fact, CJ and Google Affiliate Network all cleared OneCause.
Economic conditions are tough in the U.S. market, but it’s hard to believe that business is so bad that networks can’t find other ways to increase revenue rather than undermining affiliates and slicing up their affiliates’ revenue. This is ultimately bad business for the long run because it undermines the basic rules of trust between a network and affiliates.
Merchants need to ask themselves if they want to be working hand-in-hand with networks that are cannibalizing their valuable affiliate sales channels and undermining core affiliate partners. And affiliates must consider if they want to be promoting merchants that allow their traffic to be cannibalized for someone else’s profit. The affiliate business exists because of synergy and trust between all parties. Cannibals have no place in that equation.
Chris Sanderson is the owner of AMWSO.com, an Outsourced Affiliate Management Firm, with an international team of dedicated affiliate managers supporting clients programs on a global basis.