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  1. #1
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    Advice For Affiliates On The Topic Of Merchants & Fraudulent Reversals
    Hi,

    We just wanted to post a question just to get a little bit of advice if we could.

    Just to give a quick bit of insight on who this question is coming from, we are a group of part time affiliate marketers, and as a group we have been in affiliate marketing for about 8 years. We're very part time, and are not by means experts, but we have fairly decent experience, and work in web development and marketing in our full time jobs, so we're plenty familiar with related industries.

    This year we have ended a relationship with a merchant for the first time due to it becoming clear to us that the merchant was fraudulently reversing legitimate referrals. If you're wondering how we are "certain" the reversals were fraudulent, it's a bit of a long story. Of course we don't have access to a merchant's sales records, so we can't have that level of certainty, but to try to give a little bit of insight on the long story...

    1. We don't do PPC, and don't do any kind of low quality promotion where we target generic traffic. We do all extremely targeted promotion through blogging and detailed niche product promotion that's very specific to our audience. We don't refer an extremely large amount of sales, and our referrals tend to be very specific, high quality referrals. To better explain, we are bloggers, and we refer traffic through promoting products to a regular fan base that we keep in touch with through comments, emails, etc.

    2. We promote over 100 merchants, and we only have a mentionable history of reversals with 2 merchants, and almost 50% of our reversals in an 8 year span have come from this one merchant we just ended our relationship with, and they were all in a 2 year time span. So within 2 years, this one merchant almost reversed more sales than over 100 other merchants combined have in 8 years. And all of our merchants are in the same industry(beauty and fashion), so the merchants who are not reversing transactions have extremely comparable products. The reversals from this merchant were becoming so routine that they were starting to reverse more than they didn't. In general there were just a lot of suspicious things that took place around the reversals.

    - For instance one time we contacted them to discuss the increasing reversals, and they didn't respond to our email, yet after we sent them an email, the latest reversal "mysteriously" un-reversed.

    - Or we would refer a sale, and they would reverse the transaction almost right away and claim "returned merchandise", when the sale had just taken place a few days before - so there weren't even enough business days within the time span for the product to be ordered, the order to be processed, shipped, received, and then for the shopper to evaluate the product, and then mail it back to the merchant.

    - They were constantly claiming "returned merchandise", yet through our blog comments, we were in touch with many of the girls and women who we were referring to them, and they were doing things like sending us pictures of themselves in the dresses they were buying, or leaving us comments about their orders, that were supposedly being returned. This was truly one of our top promoted merchants - we blogged about them all of the time, and our readers were always sharing things like how they bought a dress we featured in our blog for their prom, or how they bought some dresses we promoted for their wedding bridesmaid dresses, etc.

    - The reversals were always "returned merchandise", and it was always the entire order no matter how many items were ordered. When we think of our own behavior as shoppers, we can't think of a time that we have ever ordered a group of multiple products and returned everything in the order, so it's hard for us to believe that for 2 years straight we had the back luck of constantly referring shoppers to them that were always returning every single item they ordered.

    - In general, the reversal rates with this program didn't in anyway line up with the behavior of the kinds of reversal rates, or better phrased, lack of reversals, that we experience from our sites. Again, we're not huge referrers, and our traffic is super targeted, so we truly don't hardly ever experience reversals.

    It took us a long time to leave the program because we really truly loved their products and we wanted to give them the benefit of the doubt. (After we became suspicious of the program's practices, we actually stayed in the program for a whole year and put up with the high reversals because we loved the store that much.) After the first year of us noticing increasing reversals, we monitored their reversal rate every couple of days for over the next year, and the merchant had a reversal rate that was consistently around 65% and even higher for over a year. Last week when we left the program, they had a 96% reversal rate that week, and this week they are at 75%. When we finally closed out the program, we had some pending transactions with them that were still not locked, and not surprisingly they reversed those right after we left claiming "returned merchandise" of course.

    Anyways, our reason for posting is less about this specific merchant and that situation as we have already left the program, but more to maybe get advice from other affiliates on the big picture of the subject...

    How do you deal with this issue in the industry? Until this experience, we actually had no idea that merchants could simply reverse sales whenever they felt like it and that they don't actually have to provide any sort of data to back reversals up. We truly mistakenly thought that sales were actually somehow tracked within the merchant side of the affiliate technology, and that reversals were somehow based directly off of sales data. We know, we know naive affiliate of the year award goes to us <----

    But to us, this seems like an enormous flaw in the industry. Basically this means that an affiliate's entire livelihood depends on an "honor system". It just kind of boggles our minds that an entire industry where money transactions take place is not actually based on any sort of legitimate data. :\ Does anyone else feel like this is an area of the industry where some sort of change should take place and merchants should actually have to provide records/data that support reversals? How do thousands of people put their entire financial security into an industry where in the end, there really is no security or data based system for how the money is earned?

    We do actually work with mostly fantastic merchants, so please know that we are not saying that merchant fraud is an issue with the entire industry. In fact the 2 merchants we refer the most sales to are at Shareasale, and are really really great all around. In several years of referring sales to these 2 merchants on a regular basis, they have never reversed a single referral, and they are very on top of their programs, awesome to communicate with, and in general just great businesses we are proud to promote.

    We also completely understand that merchants have their own side of the coin dealing with fraudulent affiliates, but since we're honest and we operate with integrity, we kind of blindly expect the world around us to operate in the same manner, so we're not really aware of what affiliates even do that's fraudulent, we just know it's an issue they face.

    Anyways, we guess the question at the core of this long-winded post is this... as affiliates, how do you balance your commitment to the industry with the knowledge that, in a sense, your income is inevitably always at the mercy of the people who you work for simply deciding to be honest when there really is no measure in place to ensure that they are?

    We have always been part-time affiliates, but we do enjoy it, and are super passionate about our sites we have, and have always had the dream of someday jumping all-in and making this our actual career, but can't quite seem to grasp in our minds how we would ever feel secure knowing that what we have described here is essentially the way it works.

    Any thoughts, advice, encouragement? It's all appreciated

    Thank you so much!
    Last edited by jhill; June 21st, 2015 at 02:20 AM.

  2. #2
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Wow.

    First of all, though you had a lot of information to relate, you were very repetitive and included some superfluous information, and the end result, unfortunately, is that few people will take the time to read your entire post. As a blogger myself, I know that detail serves a purpose, but not here if you are seeking answers to the basic questions.

    As the the basic issue, though, the bottom line is that the reversal problem is an issue that affects us all at one time or another, and direct answers to specific reversals are almost impossible to obtain. Sure, for the legitimate merchant with rare reversals, they are often willing to provide a legitimate reason, but for the less than ethical merchant with a high level of reversals, reasonable answers are almost never received. What I have found to be very upsetting is when you can prove to a merchant that a specific sale was absolutely, positively fulfilled and not returned, and they still will not admit that they were wrong in doing the reversal. When that is their position AND the situation where they return your commission but say they're paying you because they value the relationship and NOT because the reversal was wrong, I find worst of all.

    The bottom line is, however, that we really have no recourse, and veterans in this business have learned the necessity of keeping a close eye on reversals, and no matter how much you like the merchant's products, when the reversal rate reaches an unacceptable level, you HAVE to remove the merchant from your sites and stop promoting their products, period. The more free sales they get, the more empowered they become, and the more they take advantage of you and other affiliates.

    I'm not sure I've answered everything, but if you have any additional questions or comments on this issue, please post them separately and directly.

    Finally, I did find your enthusiasm and prospective very interesting and I hope you will do an Intro post and continue as an active member of the forum. Just don't make your posts so long
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
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  3. #3
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    Hi,

    First, so sorry for the too much info mistake, I think we went overboard because we weren't sure if it would be more helpful to give a background of our history with that merchant so that we didn't appear to be unfounded in our concerns? But thank you for taking time to respond . We'll keep that in mind from now on. We will probably do an intro soon, we're just sort of tip-toeing in since this is our first time in the forums

    Thank you for sharing though. Since we haven't ever ventured into affiliate forums until now, we haven't been too aware of what other affiliates have experienced regarding this issue. This merchant's behavior was actually really the first time we've encountered this so we kind of questioned our own gut feelings for a long time, but what you say here is actually how we began to feel...

    Quote Originally Posted by Phil Kaufman aka AffiliateHound View Post
    The more free sales they get, the more empowered they become, and the more they take advantage of you and other affiliates.
    We felt like the longer we stayed in the program, the percentage of reversals increased in a sense because they saw they were getting away with it. We just feel like this is such a mistake on the merchant's part because they end up running off honest affiliates who are committed to them and enthusiastic about them. To us it seems like it kind of creates a cycle of unethical parties continuing to take part in the industry because it allows there to be an environment for unethical merchants to thrive, and in response, honest affiliates are less encouraged to participate, and the affiliates that stay in these programs who don't care to address the issues, don't because they are taking part in unethical behavior themselves.

    It seems sad to us that there isn't a better system in place to handle reversals. And we mean for everyone involved - merchants and affiliates. Some way for it to be tracked so that affiliates didn't have to question, and merchants didn't have to defend themselves. We understand that it would probably be incredibly complicated, and create privacy issues for the merchants, but the way it works now there really is no measure of accuracy in place, which like you said, basically leaves affiliates powerless and without recourse. I guess it's just wishful thinking on our part, but we would feel much more confident in committing to affiliate marketing full time if this area had a better process :\ We have always held it as a dream to commit to this full time, but the gray areas like this where integrity issues can make or break your financial security have been our biggest fear.

    So would you say that an affiliate's only real plan of action in terms of feeling stable in this as an income is to build their business model around a large number of merchants so that no one merchant creates a dependency? And even if you have a business model that can survive because it's flexible merchant-wise, is there still ever truly a way for an affiliate to feel long-term security?

  4. #4
    Beachy Bill's Avatar
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    Welcome to reality in the world of business. Sorry, but what you experienced is not unique. Pick up, pack up and begin promoting a competitor. And, as your final paragraph suggests - do not put all of your eggs in the same basket. Never allow your business model to be completely dependent on one merchant (or one host or one website or one of anything).
    Bill / Marketing Blog @ 12PM - Current project: Resurrecting my "baby" at South Baltimore..
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  5. #5
    Speechless OTProf's Avatar
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    Out the name of the company so others can leave them too. Maybe then there will be change or at least accountability.


  6. #6
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    OTProff is right in suggesting that you do post the name of the merchant. Who knows, they may come here and respond. They could have a reasonable answer and it's not impossible that they could apologize and say they've seen the error of their ways. But, it wold in any case, give other affiliates a head up.

    Bill is absolutely right as are you in your response about not becoming dependent on any one merchant (or network or site, etc) but it did not seem like you are, that you do promote numerous merchants in your niche.

    Also, since you posted this in the SAS forum we are assuming that this does involve a SAS merchant, but if you do not name the merchant, please verify that their affiliate program is available only through SAS.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, there’s no place for truth on the internet." -Howard Wolowitz[/SIZE]

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  8. #7
    OPM and Moderator Chuck Hamrick's Avatar
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    Affiliates have the unique opportunity when wronged to move their efforts and traffic to another merchant (or several). Advertising agencies and large publishers wouldn't just turn on competitors ads comp'd if slighted. So give that sacred traffic to competitors and let them know that you want solid relationships. You might be surprised how well they respond to you. Affiliate marketing is relationship based but many times that is skewed too much to the merchant who makes decisions in a vacuum. My hope is that your sales are missed and someone gets caught with their pants down.

    To clarify the order tracking process, outside of the cookies and click tracking, information is processed after the sale is made to the credit card via the Thank You page. That is a one way transfer of order information to the network. The network also loses their fee when an order is reversed so they are your partner in the process. Make sure they are aware as they may decide the merchant is not trustworthy and terminate services. It is the full authority of the merchant to reverse any and every order from their end. Good Luck.

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  10. #8
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    Hi,

    Thank you all of for your responses.

    Yes it is an exclusive ShareASale merchant, and as of today their 30 day reversal rate is 72.73% - which is not at all abnormal of what we observed with their reversal rate at since 2013. 45% was the low end of their reversal rate that we would notice, so it's fair to say that 45%-65% of your referrals being reversed is what you could expect from them as standard. Last night, we also just discovered the edit trail of our non-reversed transactions, so we're realizing there are pretty significant additional commissions we did not receive even when our transactions were not reversed - as in... "Pre Edit: $177.00 - Post Edit: $68.00", "Pre Edit: $144.00 - Post Edit: $66.00", "Pre Edit: $74.00 - Post Edit: $6.00".

    We're hesitant to name the merchant in fear of instigating any sort of ongoing negativity with the business. We're certain the woman who owns the store would be aware of who we are. After trying to contact the store's affiliate program through ShareASale and not getting any responses, last month we emailed the store directly through their website's contact form, and after over 3 weeks passed, the store owner responded herself. Her answer was that she feels their reversal rate is normal, that she personally checked all of our reversals and that we simply had "unfortunate coincidences" with our referrals. In the end, her response is what pushed us to leave the program. The program does not have an affiliate manager, and while she stated that her employees work on the affiliate program, it's a small dress boutique, and we got the feeling that she probably handles the program and reversals herself. She was clearly very aware of the program's behavior and her stance is that the reversals are completely normal, and that we're just unlucky affiliates.

    We did contact ShareASale regarding the merchant, and their response was that we should stop promoting the merchant.

    We are for sure getting a bit of a shocking awakening to the reality of this industry, so we know now that we need to start making ourselves much more aware of things and making better decisions based on how the industry works. We do feel like the three really big mistakes we have made up to this point are this...

    1. Not being at all aware enough of what is taking place in detail with our referrals. We should have been researching this part of the industry long ago. Also, the transaction edit trail is something we were completely unaware of until last night, so that's an extra awakening for us too right now.

    2. Being far too "emotionally" attached to merchants because we personally love their products, and ignoring the business reality of our relationship with the merchant.

    3. Viewing ourselves as "just part-time affiliates", so in sense, allowing ourselves to be treated with less respect.

    Thank you all again for your responses, and sorry for the over elaborate posting.

    Fortunately, we have created a business model that promotes a large number of merchants, and we do have more than 1 website, so it's good to know we are on the right track there. As far as the areas where we have made mistakes up to this point, we realize that we really need to start educating ourselves, and begin making better decisions moving forward.
    Last edited by jhill; June 21st, 2015 at 02:55 PM.

  11. #9
    Beachy Bill's Avatar
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    Well, if you're not willing to help us out by warning us of this scammer, then why bother asking for advice?

    Bye.
    Bill / Marketing Blog @ 12PM - Current project: Resurrecting my "baby" at South Baltimore..
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  13. #10
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    Hi Bill,

    We are not trying to take advantage of anyone's help. If you read our original posting, we state this...

    our reason for posting is less about this specific merchant and that situation as we have already left the program, but more to maybe get advice from other affiliates on the big picture of the subject...
    And then we go on to explain that we are seeking advice on how to deal with this issue in the industry in general, and that we have provided background on this specific merchant interaction to show that our concerns have a basis to them. We feel we have been completely respectful and grateful, so please know we are not trying to start any kind of negative interaction with you or anyone else here.

    We understand what you are saying in terms of warning others of the "scammer", but we feel it's a touchy situation because the merchant's stance is that they have done nothing wrong and that the reversals rates we experienced with them are completely normal. While we don't agree with the merchant that this is correct, we don't have access to their sales records, and can't "prove" any wrong-doing on their part, so we are trying to be professional and respectful of everyone involved.

    As affiliates, we came here looking for more insight on this issue overall, and insight how to better navigate this industry now that we know this is something that we are going to have to face.

  14. #11
    ABW Ambassador JoyUnltd's Avatar
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    jhill: You took up the entire first half of your quite lengthy post with detailed info about your interaction with this merchant...and then expected everyone to catch your "disclaimer" that this isn't really about one merchant. SMH.

    It doesn't matter whether or not there's wrong-doing: a 70%+ reversal rate is something most affiliates would avoid. Knowing who the merchant is can help other affiliates not waste their precious time as this apparently is an ongoing situation, not just a 7- or 30-day reversal issue. It's a two-way street: you've received help, so please help others.

    BTW, most of us are part-timers in this biz. Nothing wrong with that.
    Renée
    Pay no attention to that woman behind the curtain. -Wizardress of Oz

  15. #12
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    Hi JoyUnltd,

    This is our first time posting in any affiliate forum ever, so it appears we have made mistakes in how we have presented our information. We apologize, we genuinely thought that if we didn't provide a background on our experience with the merchant, that we would seem as if we didn't have reasons for our concerns regarding the topic. We truly had no clue that this issue was so widespread, and for a long time we were not even sure if we had a right to be concerned.

    So how about we do this regarding the merchant we have discussed...

    1. The merchant we have discussed in these posts is this merchant from ShareASale:

    https://account.shareasale.com/a-vie...rchantID=33435

    2. We observed the programs reversal rates regularly for a little over a year from 2013 through 2015 and we consistently observed a network rate that averaged 45% to 65%. As of this posting, their 30 day reversal rate is at 76.19% and last week we observed it at 96%, so in our experience, high reversal rates are ongoing for this merchant.

    3. In our few years of promoting them we feel that we personally experienced a high rate of reversals and edited transactions, as well as experiencing communication issues with the program, and other things within transactions to make us uncomfortable, so we came to question the accuracy of the program's reporting, and we feel the issues increased the longer we stayed in the program and didn't address anyone regarding the statistics.

    4. We did finally contact the merchant directly through their website, and they feel that their reversal rates are normal/industry standard. While they did acknowledge that our websites had a significant number of transactions reported as "all returned merchandise" through their program, they state that there has been no wrong doing on their part, and that we simply experienced "unfortunate coincidences".

    So, we hope that is maybe helpful to other affiliates? Again, we don't have any confirmation of wrong doing by the merchant, so you are welcome to take the information we have provided and make a decision about their program for yourself, but please know that we did leave the program recently because of the issues we experienced.

    Hope that helps?

    And again, thank you everyone for your responses.
    Last edited by jhill; June 21st, 2015 at 07:11 PM.

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  17. #13
    ABW Ambassador JoyUnltd's Avatar
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    Quote Originally Posted by jhill View Post
    So how about we do this regarding the merchant we have discussed...

    1. The merchant we have discussed in these posts is this merchant from ShareASale:

    https://account.shareasale.com/a-vie...rchantID=33435
    Thanx mucho!
    Renée
    Pay no attention to that woman behind the curtain. -Wizardress of Oz

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  19. #14
    ShareASale President/CEO and ABW Veteran Brian - ShareASale's Avatar
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    Jhill - I'll take a look at this for you, if you'd like please email me your userID on ShareASale so that I can get back to you and look specifically into voids on your account. If you'd prefer not to, of course that's fine as well, I'll just look at the issue generally in that case.
    Thanks,

    Brian Littleton
    President/CEO - ShareASale.com, Inc.

  20. #15
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    Hi Brian,

    Thank you so much for responding. We did submit tickets through our account regarding this issue back in May, and presented this same info, and the response was that we should stop promoting the merchant, which we have finally done. We did have a few pending transactions with the merchant when we left last week, but they have already, not surprisingly, reversed those last few transactions as "returned merchandise". I think as far as this merchant goes there isn't much we can do, as this is how our experience was with them for the past few years. The store owner's stance is that all of her reversals are legitimate, and her description of our experiences with her program was that we have had "unfortunate coincidences". Because of the reversals that took place, we have had the feeling for some time that this merchant was taking advantage of us, but obviously we know that "a feeling" isn't confirmation of anything. So at this point we just hope other affiliates are not being taken advantage of by the merchant :\

    The main reason that we posted here is that we have been part time affiliates for a very long time and have always wanted to make more of a commitment to it, but gray areas such as this have always given us pause, so we've kind of just casually maintained our sites as a sidebar to our "real lives". But we have now realized that that casual approach has likely left us vulnerable to things we should have been much more educated on. And because we have not ever explored this topic of merchant reversals until now, we were never actually aware of just how easy it is for merchants to take advantage of affiliates. We truly (naively) thought that reversals were based off of actual data that affiliate technology somehow tracked?, so we don't know that reversals could be fraudulent. I think what we're really looking for by coming here is how professional affiliates navigate this issue, especially when there isn't a technical system in place that can prevent abuse of affiliates if that's what a merchant chooses to do.

    Even though we are part time affiliates only, we're actually super passionate about the sites we have, and feel we have created a creative business model that could work long term if we were able to put more time/effort into it. We have always held the dream that we could create someday enough success from our sites to leave our 55 hour a week jobs , but we are curious how affiliates who have jumped in full time deal with this issue? Are there better ways of monitoring merchants? Are they legitimately able to establish steady income? I guess we're just trying to educate ourselves on how long term affiliate careers establish security in this industry.

    Thank you!

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  22. #16
    ShareASale President/CEO and ABW Veteran Brian - ShareASale's Avatar
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    Jhill,

    I would not call it an epidemic, no. There definitely have been situations over the years where Merchants have taken advantage of Affiliates. However, it is far less common than the other way around. Unfortunately, in both directions, there can be a level of distrust - but there is one really good answer to all of that, which is communication.

    The key is finding retail partners that you can communicate with, who see the value in the customers that you bring, and who want to maintain that relationship long-term. That, of course, goes both ways as Merchants have a right to know how their brand is being promoted.

    As I said, I'll take a look at the reversals but I do believe that it is solid advice if you are not benefiting from the relationship with a Merchant either financially, or you simply don't have the trust factor and communication that you need, there are dozens and dozens of Merchants in each niche that can be replacements.
    Thanks,

    Brian Littleton
    President/CEO - ShareASale.com, Inc.


  23. #17
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    Ok thank you.

    We completely understand that the industry is a two-sided coin when it comes to issues. We have always openly communicated with merchants, and our promotion efforts have always been super transparent and we feel uniquely creative. We've never done PPC, or email marketing, or anything super complicated. We've always just promoted merchants and products in a "blog-type" atmosphere by creatively highlighting brands and products we like. We think that's what bums us out the most about the idea that we may have been taken advantage of, is that we're sort of innocently super positive about the merchants we promote, and genuinely really excited about their stuff, and for the most part we have kind of been so focused on the "fun" side of what we were doing, that we were pretty passively unaware of the business side of this industry.

    I think from here forward, we're just going to have to start making better choices. We for sure realize that we need to start paying better attention to reports, no matter how little sales we are generating, it's still important to pay attention to detail. And we're going to begin taking reversal rates into much bigger consideration. Even if a merchant is not doing anything wrong, if they have an ongoing reversal rate of 45%, 55%, 65%, and so on, it just seems like it isn't worth staying in the program when you can reallocate that effort and time into merchants who's programs provide a better return. We also just barely discovered the "Transaction Edit Trail" two nights ago. Basically, we have alot to learn.

    Thank you again!

  24. #18
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    This is an excellent thread in a while on ABW. I miss this kind of discussions here now a days.

    It just goes on to prove the fact that affiliates are on their own fighting with unscrupulous vendors, more the reasons there needs to a strong forum like this.

    No offense to SAS or Brian, they are way better than the rest in industry. However, affiliates still don't get the right amount of attention while dealing with issues even in the best of networks. Look at the two types of response they got dealing with the same issue. When it was to reported to the network internally, they got somewhat of a canned response that frustrates most of us. When it was reported here, Brian wanted look at it more closely. Couldn't that have been done when it was reported to them the first time. I am sure it could have been. But when you are screaming on your own, nobody hears it, it doesn't get to the top. They got excellent advice to leave the vendor. But doesn't an average affiliate know about this excellent advice already. Did the network do anything above and beyond the obvious answer, no. Couldn't they have looked into it a little more closely then what Brian wanted to do now.

    Bottom line, it's frustrating being an affiliate.
    Last edited by sam_park; June 22nd, 2015 at 03:37 PM.

  25. #19
    ShareASale President/CEO and ABW Veteran Brian - ShareASale's Avatar
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    Sam_park,

    Respectfully, I disagree with a lot of what you said, mostly because I come at it from a different angle obviously - but we can agree on one thing definitely, and that is that a place like ABW is very important. It is definitely something that I miss with Affiliate Marketers coming here daily to discuss important things!
    Thanks,

    Brian Littleton
    President/CEO - ShareASale.com, Inc.

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  27. #20
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    Hi sam_park,

    This is I think what was the biggest awakening to us, there isn't any sort of legitimate accountability system for reversals. We truly thought reversals were backed up through data, and it's really just an honor system, which is the main part that boggles our minds a little. Even in other industries where commission is the source of income, the phases in which the commission is earned is documented and based on available records/data.

    And Brian we understand your experience in this industry shapes your perspective, and that it legitimately comes from years of experience with an entire industry of unethical affiliate marketers, but what I think the issue that affiliates face is that the system puts things in place to protect merchants, but not affiliates.

    To better explain what we mean... we're just a group of friends who started blogging as a hobby many years ago, and we expanded into the industry of affiliate marketing to make money from our "hobby". So really, all we are is a couple of friends who have a few "fashion blog" type websites, and we post links on our websites and creatively promote stuff we think is awesome. That's really the simplified extent of it. There isn't much we have the power to do that's a detriment to a merchant. If anything, it's a fantastic situation for merchants. They basically get free up-front advertising and labor from contract workers, and they only have to pay a fee if sales are generated, and those sales are documented and monitored on their end, so they have proof of our "work" and can base their payments off of that data. Yet, turn the situation around, and as affiliates, we commit our time and advertising space up-front for no guaranteed compensation, and sort of cross our fingers that the merchant we have worked for is honest enough to pay us properly, yet in the case of reversals, we don't have data on our end to ensure we are paid fairly.

    Again, we understand that we don't represent everyone, and that there are plenty of affiliates doing things that are fraudulent, illegal, etc., but those people have to break the rules of the system to take part in those activities. Since we have no desire to do anything unethical, the merchant is completely protected by the system in a relationship with us.

    However, it's not the same for the merchant side of the industry. Since there isn't truly anything that holds them accountable for reversals, they can completely take advantage of affiliates, and it's still completely within the system.

    Hope that makes sense?

    So I think this is the challenge we came to the forums to educate ourselves on. How can we create financial security in our affiliate business knowing that we have to navigate around this pretty unusual and unsteady issue in the way that our money is earned?

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  29. #21
    ABW Ambassador
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    Well, it's not awakening for me exactly. I have been in industry for a while, seen many unscrupulous merchants.

    What I am talking about is how affiliates and merchants are treated differently even by the best of the networks. Affiliates are always dealt with an iron hand and left to fend for themselves. Don't like the merchant, leave. Of course the affiliate will leave after getting screwed. Why doesn't the network step up to the plate and see if there is any validity in the complaint before more affiliates get screwed!

  30. #22
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    No, I totally understand. I think the core issue is that the industry feels unbalanced for the honest affiliate.

    And we kind of think that if the merchant side of the industry was more willing to balance things out, it would be better for them!

    As long as the system stays unbalanced, then honest hardworking people who want to create a legitimate business are going to shy away from affiliate marketing because the default environment doesn't support them being able to create a steady business where they have the security they need to be committed and thrive. So, the industry sort of encourages it's own negative cycle... if it's hard to feel secure when you're an honest affiliate, honest hardworking affiliates will be few and far between.

    So the merchant side being resistant to creating a secure environment for affiliates is in a sense pushing away the very type of affiliates they want to have. :\

    Just a little food for thought?

  31. #23
    OPM and Moderator Chuck Hamrick's Avatar
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    I think the lesson that you now know is yes if the reversal rate it twice your average then dump the merchant. Of course you should call them out directly first and if they hold the stance that it's just the nature of the business then something stinks.

    We worked with a merchant who had a 25% return rate which we felt was bogus but the affiliates were making good money (average order was $1000 plus 8% commission). So we decided after talking with our top affiliates that we would just have to eat it. Year later when their competition caught up with them they lowered the return rate but it was too late.

  32. #24
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    There are some merchants (yes, very few, but some) that realize that once a sale has been made the affiliate has done their job and earned their commission, so ever if the sale itself is reversed, especially if it is due to a merchant issue, such as the product going out of stock, they NEVER reverse the commission.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
    "Raj, there’s no place for truth on the internet." -Howard Wolowitz[/SIZE]

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  34. #25
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    Thank you all so much for your input. We're for sure going to make better decisions going forward, educate ourselves better, and I think trust ourselves a little more too. If something about a program doesn't feel right, don't waste energy in a negative situation, just move on and promote a program that allows for a positive partnership.

    Good luck to everyone here

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