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  1. #1
    Affiliate Manager Rob@GoFreelance's Avatar
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    Should You Tolerate Reversals?
    Reading through the threads on ABestWeb, I'm amazed that you guys have to put up with so many reversals. At Freelance Work Exchange, we don't reverse anything - we take the hit for chargebacks, etc. The only time we would is if we thought an affiliate was generating fraudulent sales - fortunately, you guys dont' give us that kind of problem.

    The way we see it, you've done the hard work in generating the traffic. After that, it's up to us to make the sale stick. What do you think?

  2. #2
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    People return stuff sometimes.

  3. #3
    Affiliate Manager Rob@GoFreelance's Avatar
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    Of course, we get requests for refunds, etc., the same as every merchant. But we don't reverse the commissions. It's not the affiliate's fault if the customer isn't happy for any reason - that's down to the merchant. Why should the affiliate be penalized for that?

  4. #4
    ABW Veteran Mr. Sal's Avatar
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    At Freelance Work Exchange, we don't reverse anything
    Wow Rob, that's a bold statement to make on this business.

    That alone may get you new affiliates to join your program but, you're missing something very important here.

    I have a suggestion for your program and I don't know why it haven't been posted by someone else before.

    Example:

    I was reading the new posts section area and the title "Should You Tolerate Reversals?" got my attention, so here I am reading your post and it sound interesting but, I don't see any link to your program or any details of what you're promoting or what you pay in commissions, etc.

    Since I have some extra time right now, I decide to go check your forum and after I can't find the info I am looking for, I went to the "New Programs and Announcements" area looking for your announcement on that forum, after I view two pages of all of the other New Programs announcements and didn't find yours, I give up looking and here I am.

    My suggestion is that in order to get more affiliates joining your program, you first have to make the details of your program more accessible to the general affiliates just browsing the forums, not everyone around here will go to CJ just to search for "FreelanceWorkExchange" just to read the details of the program.

    I don't know why you have not done it before but, I think it will be a good idea for your program to at least, make a sig with some details and or a link to your program on CJ and a link to your site too, that way your future affiliates can see the site to where they are sending their visitors.

    Sal.

  5. #5
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    It is good that you don't reverse commissions on your affiliates. If you can get away with it then by all means have at it But just because you can do it doesn't mean every other business can too. Every business on the internet is different and has different needs, requirements, etc...

  6. #6
    Affiliate Manager Rob@GoFreelance's Avatar
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    Hi Sal

    Thanks for pointing that out - those details used to be in my sig file, but vanished in the switch to the new board. Guess I'll have to update it asap. In the meantime, you can find the forum here:

    http://forum.abestweb.com/forumdisplay.php?f=106

    However, the intention of the post wasn't to recruit affiliates (although everyone is welcome, of course). I just wanted to raise an issue that has irritated me since my days as a CJ affiliate.

    It may be fair enough to reverse fraudulent or declined orders, as they weren't real sales in the first place. But I don't see why the affiliate should be penalized if the merchant is out of stock, sends the wrong stuff, offers poor products, or otherwise lets the customer down.

    The affiliate's responsibility is to send traffic that converts. Then surely it's the merchant's responsibility to deliver the goods - in more ways than one.

    Rob Palmer

  7. #7
    Member Chocolate_Chicken's Avatar
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    Why should the affiliate be penalized for that?
    Penalized? By not being paid for not making a sale?

    This is the kind of mindset that gives the affiliate community a reputation for being a bunch of worthless bums. Most of the webmaster community as a whole regards affiliates as the dregs of society, and these 'entitlement delusions' are one of the biggest reasons for it.

  8. #8
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    What Chocolate Chicken said. I don't have a problem with merchants reversing my commissions if the sale wasn't completed. I expect them too, i would. Now if it wasn't legitimate, that's another story. Merchants are supposed to be our partners, so if they don't get paid (sale) i shouldn't get paid (commission) That should be understood going in.

  9. #9
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    Every merchant has reversals in one form or another, I bet including your program Rob. It's all in the way it is presented. Factoring would be a good term for it. Let's say a merchant can afford to pay 15% to affiliates for completed sales and they charge back what amounts to 20% of orders. Shoes might fall in this category.

    As a shoe merchant I have two options, pay 15% and reverse commissions on all returns or pay 12% or whatever the effective commissions would be after I factor in lost revenue that I'll be paying out for sales that got returned.

    Lets say I have shoe traffic that converts really well and the customers never return anything, then there is this other affiliate who targets teens during prom season. This affilaite sends customers that order lots of expensive shoes to wear to the prom or semi formal who will simply return them after the prom for a refund.

    If I'm promoting to the prom crowd, I'm gonna send my traffic to the merchant who doesn't do reversals. The affiliate who sends the real customers that never send back their orders is going to finance my payouts by taking a lower (12% for no reversals as opposed to 15% if reversals are passed back to affiliates) cut so I can get paid for the prom crowd who just takes advantage of the return policy.

    To reverse or not to reverse is six of one & a half dozen of the other. The merchant knows what they are willing to pay for sales and however they struture it, chances are it will come out the same in the end. It's definitely good marketing to advertise no reversals though. It's like raising prices just enough so free shipping can be offered without really giving the consumer any discount at all.

  10. #10
    Affiliate Manager Rob@GoFreelance's Avatar
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    If you send a merchant a real customer who pays for a product with a valid credit card, you've made a sale. If the merchant then screws up so badly (out of stock, wrong product delivered, whatever) that the customer asks for a refund, why is that your fault?

    If you had sent that click to a competing merchant, you would most likely have kept your commission.

    I agree absolutely that it's all about partnership. Unfortunately, many merchants don't value this partnership. Why else would they make you pay for their mistakes? There is always a risk in any business transaction, but I think the risk should be shared, not dumped on affiliates who are doing their best to do a good job.

    Rob Palmer
    Freelance Work Exchange

    http://forum.abestweb.com/forumdisplay.php?f=106
    http://www.freelanceworkexchange.com/affiliates.html

  11. #11
    Affiliate Manager Rob@GoFreelance's Avatar
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    >Every merchant has reversals in one form or another, I bet including your program Rob

    I guess we're lucky in that our refund/chargeback ratio is low enough that it's not really an issue. I know some merchants have a huge problem with fraud, so they may be in a different position. I just remember being an affiliate and having that sickening feeling when a juicy commission was whisked away from under my nose...geez, I hated that. That's why we're committed to finding a different approach.

    Rob Palmer
    Freelance Work Exchange

    http://forum.abestweb.com/forumdisplay.php?f=106
    http://www.freelanceworkexchange.com/affiliates.html

  12. #12
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    It might show up in the reports as a sale at first but if the product is out of stock there is no actual sale, no product was delivered to the customer. When i buy something online the sale it not complete until i have product in hand. You also have cases where a customer might order something in the wrong size and return it. That's neither the merchants or affiliates fault. It happens. Of course no one likes them but reasonable people should expect them from time to time.

  13. #13
    Affiliate Manager Rob@GoFreelance's Avatar
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    Quote Originally Posted by TrustNo1
    It might show up in the reports as a sale at first but if the product is out of stock there is no actual sale, no product was delivered to the customer. .
    In that case, there was a sale - but the merchant threw it away. You did your job, the merchant didn't. You are being robbed of your commission through the merchant's incompetence. That's as bad as losing commissions to parasites.

    If the customer ordered the wrong size, fair enough - that's not the merchant's fault. But some merchants seem to suffer from these problems more than others...a good reason to look elsewhere for partners.

    Rob Palmer
    Freelance Work Exchange

    http://forum.abestweb.com/forumdisplay.php?f=106
    http://www.freelanceworkexchange.com/affiliates.html

  14. #14
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    "In that case, there was a sale"

    Nope. A sale involves the transfer (delivery) of property (product, merchandise, commodity etc.) from the seller to the buyer. If that doesn't happen, there isn't a completed sale. I wouldn't equate a merchant being out of stock on an item with parasites. That's a big stretch.

  15. #15
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    Rob, are you selling a physical good? Do you have fraud against you? Can your product be out of stock? Can someone order the wrong size? Be shipped what they were not expecting because they misunderstood the picture or product?

    I think you are being disingenuous here and purposefully obtuse as to try and promote your program in the CJ forum. While maybe some newbie will fall for your song, as you can see here, most will not and can use common sense to understand the need for reversals.

    For me, your lack of understanding of this basic need would scare me off your program. It tells me you don't understand the business.

  16. #16
    Affiliate Manager Rob@GoFreelance's Avatar
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    Yes, I naturally understand that many reversals are unavoidable. But having worked on both sides of the fence (as an affiliate and as a merchant), I think affiliates are letting merchants off the hook by accepting 100% of reversals without question.

    If the sale is reversed because the merchant has forgotten to re-stock, or the shipping department got the wrong address, or the order wasn't checked properly, then you are losing money that should have been yours. A more efficient merchant would have closed the sale and paid you your commission.

    Don't forget, we are talking about big numbers. If just 1% of affiliate-generated transactions are reversed, that's a huge amount of lost money - certainly many millions.

    Don't you think merchants should be under pressure to get the problem under control? Even a 10% reduction in reversals would put a lot of money back in affiliates pockets.

    Rob Palmer
    Freelance Work Exchange

    http://forum.abestweb.com/forumdisplay.php?f=106
    http://www.freelanceworkexchange.com/affiliates.html

  17. #17
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    Yes, all merchants are screwing themselves out of sales, just to stick it to affiliates. Genius!

  18. #18
    Affiliate Manager Rob@GoFreelance's Avatar
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    Quote Originally Posted by chetf
    Yes, all merchants are screwing themselves out of sales, just to stick it to affiliates. Genius!
    I certainly wasn't suggesting that, as I'm sure you know. Some merchants run their businesses very efficiently, and some don't. There are lots of things merchants can do to reduce fraudulent orders and cut down on errors - and so reduce reversal rates. That's good for the merchant, the affiliate and for genuine customers.

    In other threads on ABestWeb, there are reports of merchants with a 50% reversal rate - that's really scary. If a merchant has a high reversal rate, there is either something wrong with their business model, or they are scamming affiliates.

    We deal with these issues every day, like any merchant. We scrub hard for fraud, we do our best to ensure that customers are happy, we work at ensuring orders are fulfilled promptly and efficiently. There's always room for improvement, of course, but we are very conscious of the need to protect our affiliates' commissions.

    In short, we work damned hard to ensure that we don't 'stick it to affiliates.' We wouldn't deserve your traffic otherwise. That's why we don't routinely reverse sales. If we screw up once in a while, we'll take the hit for it. If it's our mistake, we won't ask for your money back.

    And yes, I appreciate that though this works fine with our business model, it would be different if we were, say, shipping expensive hard goods overseas. But it's your traffic...you can choose who to send it to.

    Rob Palmer
    Freelance Work Exchange

    http://forum.abestweb.com/forumdisplay.php?f=106
    http://www.freelanceworkexchange.com/affiliates.html

  19. #19
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    Do you sell shoes? Become an AM to a shoe or clothing merchant and promise a 0% reversal rate and i'll put you on my front page above the fold. You still have to convert and have a decent EPC tho.

    You're comparing your program which should have little or no reversals to actual merchants. Not really a good comparison.

    edited to add:
    I just checked to see what you're actually selling and you shouldn't have any reversals because, if i got this right, you're selling access to a jobs database. So it's not an apple to apple comparison you're making to merchants that ship out goods.

  20. #20
    Affiliate Manager Rob@GoFreelance's Avatar
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    You're absolutely right. Returns are a big headache for the shoe and clothing industry, and I wouldn't want to make any promises about reversals.

    But generally speaking, affiliates are not in the shoe business - they're in the traffic business. And unless you already have shoe-related traffic, you don't have to promote shoe merchants. So you don't have to tolerate high reversals. You can promote programs with lower reversal rates.

    At the end of the day, all I'm saying is that reversal rates are a factor that should be taken seriously into consideration when selecting merchants - it can make a real difference to your bottom line.

  21. #21
    Resident Genius and Staunch Capitalist Leader's Avatar
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    I just cannot believe some people are trying to talk you INTO reversing!!

    I just remember being an affiliate and having that sickening feeling when a juicy commission was whisked away from under my nose...geez, I hated that. That's why we're committed to finding a different approach.
    I'm glad you're committed to finding a different approach...and from what I gather from skimming this thread, that approach = not reversing!

    THAT'S GREAT, I say--and to heck with those who would screw themselves just to avoid feeling like "bums." Whatever's in their ventilation systems, I don't want any.

    In other threads on ABestWeb, there are reports of merchants with a 50% reversal rate - that's really scary. If a merchant has a high reversal rate, there is either something wrong with their business model, or they are scamming affiliates.
    BINGO!

    If it's our mistake, we won't ask for your money back.
    GREAT, that's more like it!

    Don't you think merchants should be under pressure to get the problem under control?
    YES!!! *Immense* pressure! I'll drop a reversal-maniac like any other crook--that is, Immediately Upon Detection.

    When I see a merchant with a ridiculous amount of reversals managing to stay in business, I figure the reversals are bogus. If they really peeved off/let down/couldn't serve, say, 50% of their customers, that'd pretty much destroy the profit of most places I can think of--not to mention that people will stop shopping at a place that's often out of stock or that is screwing up enough to cause a chargeback half the time. So, when I see figures like that on a place that miraculously keeps staying in business regardless of it, I don't believe they really have that many chargebacks or can't ships.

    And unless you already have shoe-related traffic, you don't have to promote shoe merchants. So you don't have to tolerate high reversals. You can promote programs with lower reversal rates.
    Bingo, bingo, bingo...

    >Every merchant has reversals in one form or another, I bet including your program Rob

    I guess we're lucky in that our refund/chargeback ratio is low enough that it's not really an issue.
    I wish that all merchants would figure out how to keep their chargeback/out-of-stock/fraud rates low enough to absorb what would otherwise be reversals!
    There is no knowledge that is not power. ~Hemingway

  22. #22
    Affiliate Manager Rob@GoFreelance's Avatar
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    Quote Originally Posted by Leader
    I just cannot believe some people are trying to talk you INTO reversing!!
    Phew...I was beginning to think I had posted into a merchants-only forum by mistake.

    Quote Originally Posted by Leader
    I wish that all merchants would figure out how to keep their chargeback/out-of-stock/fraud rates low enough to absorb what would otherwise be reversals!
    Absolutely. Yes, it's a big problem - but business is all about solving problems. If the average chargeback/out-of-stock/fraud rates are really that bad, we've all got something to worry about.

    Rob Palmer
    Freelance Work Exchange

    http://forum.abestweb.com/forumdisplay.php?f=106
    http://www.freelanceworkexchange.com/affiliates.html

  23. #23
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    "I just cannot believe some people are trying to talk you INTO reversing!! "

    They're not.

    "and from what I gather from skimming this thread, "

    Read, don't skim.

  24. #24
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    Quote Originally Posted by TrustNo1
    Do you sell shoes? Become an AM to a shoe or clothing merchant and promise a 0% reversal rate and i'll put you on my front page above the fold. You still have to convert and have a decent EPC tho.

    You're comparing your program which should have little or no reversals to actual merchants. Not really a good comparison.
    Last year, I made 71 shoe sales for a merchant. There were 2 reversals. The reason wasn't invalid CC or return. It was a tracking problem.

  25. #25
    Affiliate Manager Rob@GoFreelance's Avatar
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    Quote Originally Posted by S0M
    Last year, I made 71 shoe sales for a merchant. There were 2 reversals. The reason wasn't invalid CC or return. It was a tracking problem.
    Sounds like a good merchant for that sector...stick with 'em! But I'm glad we dont' have to reverse 2.7% of sales...

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