Not only that… but it’s especially prevalent in web hosting, which is an extremely viral market. Promoting a $90 affiliate program off your home page isn’t a good idea when you can get a better return on your money paying $60, and not have to worry as much about paying such a high commission to your customers who have a good probability of referring anyway (the host you’re talking about enjoys large amounts of viral marketing).

The burden of research always falls on the affiliate. While it would be great for a hosting company to proactively award their super affiliates (and I believe they should), that’s not necessarily an argument that their affiliate network commission should be the same as their home page commission. If you’re bringing a decent amount of traffic over to this merchant, the affiliate manager probably should have proactively contacted you to make sure you’re happy where you are. Of course decent is relative, and with the business you’re talking about (which I’m pretty sure I know what is, given your previous posts), your decent amount may be a rather pittance considering their growth rate.

CJ = Affiliate territory… you’ll get a better return on your money by attracting the super affiliates that have experience moving product. You achieve this through a higher payout.

Home page = The majority are inexperienced affiliates/existing clients. Why pay a higher commission to people that don’t have experience moving your product and would likely have referred for free? Not only that, but you’ll get a better return on your money by paying the lower amount than the higher.

Some merchant don’t offer an affiliate program from their home page at all. This is especially prevalent in industries with large amounts of service referrals. Why pay a commission to someone at all if they will refer your product regardless? The answer is, “Will they promote my product MORE if they receive a commission?” And that will be dependent on the industry.

PS: Regarding links, the difficulty is I have hundreds of them out there on multiple sites.

Lesson to self: centralize link management.

IMO it’s not worth your time or effort to try and fix a merchants affiliate program when there are so many properly managed ones on the net. Cut your losses, mark them down in your book and swap out those links.

I vote for “pure idiocy”.

“I considered it one of my responsibilities to keep our payouts consistent between the in-house program and the network programs. If anything, our in-house program sometimes had a higher payout because no additional fees were involved. I would never have considered that disparity between commissions”

That totally make sense. Before I got into Internet Marketing, I was involved in operations and supply chain management and the logic would be that in-house would cost less than outsourced to a network (with its associated management fees, but made up with a bigger reach to affiliates).

If the in-house aff manager is also the sales manager, lead programmer, server admin, then obviously it’s a whole diff bag of beans…

> If they were looking to anger affiliates, they sure have succeeded…

Same here. This “having to look over my back” stuff gets old, very quickly.

“Merchant should be required to disclose to affiliate what networks their offers are running on + in house offers and what the respective payout are. Affiliate have a right to know. This could be done through industry self-regulation.”

Like you mentioned, lack of an industry body and self-regulation.

It’s not only merchants running roughshod over affiliates, you’d hear instances of rogue networks doing the same too.

Thanks for the education to my rude awakening.

Yep, the reality check is always the hardest to take.

> “you got hosed and it is your own fault. This IS the standard practice and fully within the marketers code of ethics. (I can see the shit flying at me already…)”

My major beef with this, is that if I adopt a “I don’t trust you and I’m gonna check out everything you say” attitude, it’s going to waste a lot of my time that could go on something else.

I’ll probably join all the major networks now, and do a whole lot more comparison shopping in my niches.

Regarding the “ethics”, I don’t think it’s ethical to do a two versions of the same prog.

I think in-house affiliates are probably more loyal than network affiliates (on account of having more choices available).

If a merchant doesn’t gives them a second class rates, then voting with their feet is the next best thing to do.

It’s the in-house prog that underpaying by 50%.

I just called the company and a sales guy picked up. He was going me some weird answers and when I asked for some real answers, he tells me the affiliate guy will be in in 2 hours (That’s 10am on a Friday and their affiliate/business development work hours are listed as 8am - 5pm).

So there you have it…

1) lack of communication between two people that are handing things at the company. I was on the short end of this at a previous job when I managed the affiliate program. There was somebody else in the company doing “media buys” for a higher caliber of publisher than i was getting. Turned out they were cannibalizing some of my biggest affiliates for 50% more than I was permitted to pay.

2) pure idiocy. Some companies really don’t think affiliates will connect the dots when they wildly vary payouts in different places.

Either way, tell them you expect $100 a lead now.

Now that I’m with LinkConnector, I have the opportunity to see it from this side of the fence. Although I can only speak about the way we do things, we regularly monitor campaign payouts to ensure that our affiliates are receiving a fair deal. We consider this to be one of our responsibilities since the affiliates have chosen to work with our merchants through our network. And while we can’t force a merchant to change their payout, we’re not afraid to have the tough discussion on the impact of an inconsistent payment structure.

Additionally, I’m surprised the network didn’t have a talk with that merchant, unless their only goal was to see the in-house program die in an effort to move all the affiliates to the network campaign. Even if that was the case, there are better ways to do so than just angering affiliates, who not only sour on the in-house program, but on the merchant as well.

Jeannine Crooks
Affiliate Sales Manager
LinkConnector.com

I’d have to say there are more than a few shady merchants out there trying to make a quick buck off affiliates. They don’t understand the trust and building a strong relationship with the affiliates is really the key to long term success.

I will work with a merchant, even if I know I will make less money, if I feel I can trust them, vs a merchant that I know is deceiving me.

Merchant should be required to disclose to affiliate what networks their offers are running on + in house offers and what the respective payout are. Affiliate have a right to know. This could be done through industry self-regulation.