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  1. #1
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    Make Money Using PPC to drive affiliate income (schemes)
    What, if anything, should we do to protect the industry from the unscrupulous promoters who are selling bad advice about PPC/affiliate arbitrage?

    I noticed on another discussion forum (http://www.webmasterworld.com/advertising/3340975.htm) that eBay has announced that effective on June 1, it will no longer allow "direct-to-merchant" PPC bidding by its affiliates. (The same issue was addressed in a thread here, at http://forum.abestweb.com/showthread.php?t=89660, and the actual announcement in eBay's forums can be viewed at http://forums.ebay.com/db1/thread.js...=1179400135263).

    What I'm curious about is whether any part of eBay's decision was based on the growing number of "make money with PPC-affiliate arbitrage" schemes being promoted?

    Are merchants facing an increasing number of complaints and support issues related to "wanna-be" affiliates who buy into some promoter's claims that they can easily make money by enrolling as an affiliate and then bidding for keywords on PPC search engines?

    The issue, of course, is that most of these "newbie" affiliates are naieve and don't clearly understand the economics involved. Without a clear understanding, these "newbies" sign up for one or more affiliate programs and launch Google AdWords campaigns; even if they somehow create effective ad copy and choose "good" keywords, they will most likely spend far more on AdWords than they earn from affiliate commissions.

    The "scheme promoter" just wants to sell an ebook or seminar, and/or to earn a referral fee for the new AdWords account.

    Who gets blamed? Google, or CJ, or the merchants -- many of these "wanna-be" affiliates believe that Google is conspiring with the promoters to persuade people to spend money on AdWords (and Google's referral fee certainly is an issue). Or they believe that because CJ and the merchants profit from any sales transactions that result, but don't share in the costs, they are unfairly profiting. (For some reason, these schemes mostly promote CJ and ClickBank.)

    What, if anything, should we do to protect the industry from the unscrupulous promoters? Could ABW create a section specifically devoted to this topic, perhaps even "unmasking" some of the schemes and showing the flaws in many of these theories? Should we create a special thread (or forum) for victims of these schemes to talk about what happened to them, and how much money they lost, following which scheme? Should we warn affiliates to be cautious if an affiliate manager encourages them to run PPC campaigns?

  2. #2
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    So you're guessing that the ebooks false promises are a main reason for folks like ebay to react this way? Hmmm. Not sure about that. I suppose some that get duped complain to ebay, but it seems like ebay could go after ebookers with trademark issues if they this was the issue. Force the ebookers to have a disclaimer or something at least. Or report them to the FTC if they're selling get rich quick schemes that are false hope deals.

    I think it's more likely that tm bidders were aggravating them, as enforcement takes time (so will the new policy by the way, so nothing's changed except it got wider).

    I'd bet the impetus here comes from the ppc team at ebay or their agencies who are exaggerating things regarding branding control, tm abuse and roi issues.

    Your thoughts to expose and defend this legitmate avenue are well founded, but I think there are enough success stories out there that this needs no defending.

    I've been in several situations were my DTM (direct-to-merchant) PPC was so good as an affiliate that I was hired to run their ppc in-house as a consultant. Those folks are happy to have me on board whether it's as an affiliate or consultant.

    But hey, there's plenty of abuses going on, ranging from not only DTM PPC affiliates, but to PPC Agencies and beyond. So perhaps I'm too biased by my own views in this sector. Anyone else think a coordinated defense of DTM PPC is needed?

  3. #3
    Comfortably Numb John Powell's Avatar
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    What, if anything, should we do to protect the industry from the unscrupulous promoters who are selling bad advice about PPC/affiliate arbitrage?
    Part of the problem is that yesterdays schemes which may have worked are still floating around the web and are now outdated. I have bought a couple of items from respected authors that were a year old and already partially outdated. Things are changing way to fast for me.

    You may have read the same article I did yesterday on Search Engine Arbitrage

  4. #4
    ABW Ambassador Rehan's Avatar
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    I doubt eBay's motivation was from unscrupulous promoters or their victims, because the restriction is only for the US eBay program and only for the big 3 search engines. And they're still allowing affiliates to drive PPC traffic to non-eBay domains. My guess is that they think their ROI is better if they run their own campaigns as well as driving more traffic (than now) to organic listings.


    Quote Originally Posted by Donuts
    I've been in several situations were my DTM (direct-to-merchant) PPC was so good as an affiliate that I was hired to run their ppc in-house as a consultant.
    Sorry to be a little off topic, but was running their PPC in-house more lucrative for you than DTM PPC?

  5. #5
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    I can't imagine ebay making this decision based on the handful of scammers when I know they have real search affiliates making tons of money legitimately, but I have been wrong many times before when trying to figure out why corporate America does anything. I think ebay is shooting themselves in the foot here. There are abuses for sure, but to disallow this all together is to lose lots of traffic. I'm sorry, but neither ebay or any agency on earth can ever match the depth of PPC ads that are out there by ebay affiliates. They can harvest their logs and use every keyword every arbitrager ever used, but there will be an infinite number of new ones as things progress and they will eventually fall behind.

    I had a similar discussion yesterday with a merchant who has recently made sweeping policy changes in the face of a few slimeballs taking advantage of their affiliate program. If you are going to have an affiliate program, you need to empower your affiliates to drive incremental sales. Sometimes this means you have to manage it more closely, but anything worth having will require a fair amount of work.

  6. #6
    More Cheesier Than Ever Cheesehead's Avatar
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    The way this seems to work:

    1. Some clever person finds a way to make gobs of money with some new system. eg. Google Adwords in its first year or two.

    2. Clever person's scheme gets diluted by competition and/or program changes. Make up for diminished cash flow by publishing an ebook.

    3. Use check screenshots from the "gravy year(s)" as a testimonial in the ebook.

    4. Use check screenshots from the ebook sales as a more current testimonial.
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  7. #7
    ABW Ambassador Snib's Avatar
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    I've only got a couple DTM PPC campaigns, but I never really put much emphasis on them. The reason for this is it only adds to the merchant's brand. It does absolutely nothing to help me establish a brand of my own. Maybe eBay wants us to develop our own brands rather than riding their already-established name. I think a loyal customer base is much more valuable than a strong keyword list. You can close all your DTM PPC campaigns and nobody will miss you, but if you've got an established brand with loyal customers you've got something more.

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  8. #8
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    I have to disagree with that, Snib. If I close my DTM PPC campaigns I can think of a few people who will miss me terribly. I would even venture to say that my phone would be ringing. Granted, these campaigns prop up the merchant's brand, but they also allow me the cash to work on building my own brands without sweating the monetization part until the sites are able to stand on their own. In that sense, using PPC to build a merchant's brand allows me to build my own as well.
    I agree that building a strong brand is very valuable, but don't discount the power of PPC to drive buyers to the given product at the time they are ready to buy it. This not only creates sales for today but also creates loyal customers for tomorrow. (we've strayed off topic)

  9. #9
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    Quote Originally Posted by UncleScooter
    neither ebay or any agency on earth can ever match the depth of PPC ads that are out there by ebay affiliates. They can harvest their logs and use every keyword every arbitrager ever used, but there will be an infinite number of new ones as things progress and they will eventually fall behind.
    I completely agree. It's as close to infinite that exists in any program I know of or can imagine.

  10. #10
    Lite On The Do, Heavy On The Nuts Donuts's Avatar
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    Quote Originally Posted by ghoti
    Sorry to be a little off topic, but was running their PPC in-house more lucrative for you than DTM PPC?
    Yes, of course. It's more lucrative for both me and the merchant. As an affiliate, my margins are less, so as I chase every corner of a merchant's lineup, the areas that may be lesser returning are ones I seek to learn about and then avoid. I have had discussions with merchants who want me to do more and I explain that I need more margin to do that. In some cases, I have willingly taken losses in some areas of their lineups because I am also hitting the sweet spots. Heavy DTM PPC requires a good two-way relationship with the merchant. Some merchants realize my margin limitation and invite me to be in a different model where my goals and theirs are exactly the same - the consultant role. If I am spending their ppc money, we can chase anything they want as long as my overall compensation is fair. As an affiliate, I micro-manage each segment of their business looking for roi from each. As a consultant, I direct their funds to meet their goals which can be based on things besides roi - like branding, inventory, volume and other goals that aren't strictly roi based (but i still track roi, always). So for the merchant, they get broad coverage of their spectrum and excellent return on their investments, no matter which goal is being chased. That greater volume allows me to earn more than I would just chasing the highest returning segments of their business.

    Some will conclude from this that perhaps ebay was tired of allowing affiliates to grab the sweet stuff. First, a merchant doesn't have to idly sit by and let that happen. Proper policies and management of large affiliates, on a value basis, is exactly what an affiliate manager should be doing. And secondly, efficiency must be considered, even in the sweet areas. If you make the assumption that the size of a sweet area is the same whether it's covered in-house or by a DTM affiliate, you're mistaken - there's competition out there - if a DTM aff grabs you a larger slice of the sweet pie, the additional volume coming from well-run advertising can mean the roi/unit isn't a rational basis for deciding whether in-house or DTM is best.

    Since the in-house team has so much more information and higher margins, why not let the little guys give it a try. If they produce significant sales, some rethinking is needed. It's amazing what performance pay can produce in terms of effort and expertise.

    If you can hire a consultant on a performance basis, you get a hybrid between affiliate and in-house - you get to set goals and guide things, you get expertise that's well motivated, and you get to pay for performance only. Admittedly, these folks are HARD to find. I only work with people where there's a close personal referral or I have worked for them as an affiliate and seen great promise in their ability to convert in volume and to be respectful of performance (by paying for it). If I see strength in theior present ppc, I will often take a pass - being paid for performance means I seek out areas where I can have the greatest impact. So, sometimes, being turned down, is a compliment to your present ppc efforts.

    Allowing DTM PPC or getting a performance based consultant (or agency) are both good ideas. The in-house ppc team has value that I'd question.

    And by the way, my consulting is also done on a performance pay basis.

    And the merchants usually ask me if I want to stop affiliate DTM PPC or if I think it'll interfere with what I'm doing and I say nope, no need, set good policies that are consistent with your goals and then let as many performance paid people chase things for you as you can possibly get.

    And when people ask me what I charge per hour, I generally know then that I'm not going to want to be their consultant. Capping the cost of value of what I can achieve for them is in their interest, not mine.

    Which leads me to the last point - capital. If DTM affs are bearing a portion of your ad spend, you free capital and time for other activities. DTM affs accept the risk for returns, click fraud, inherent payment delays (that's a loan from your affiliates!) and more - if you're an accountant at ebay, there's a real value in shifting those risks to your affiliates. If your consultant or agency asks for all DTM PPC to stop, I'd question the motives behind that decision.

  11. #11
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    Quote Originally Posted by Donuts
    If your consultant or agency asks for all DTM PPC to stop, I'd question the motives behind that decision.
    This request usually means that they don't want to have to explain why they are being outperformed by affiliates. Happens all the time.


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    Someone asked me yesterday about eBay's recent announcement that it was suspending all of its own Google advertising, and then its subsequent announcement that it would resume advertising on Google, but at reduced rates. That led me to think about this discussion thread (which I started).

    My "new conclusion" is now that eBay's prohibition of "direct-to-merchant PPC" wasn't a response to scam artists promoting "affiliate arbitrage," but instead it was eBay's desire to have a "clean test" of the impact of Google advertising. (If eBay had just stopped its own Google PPC ads, there might have been relatively little impact on sales & traffic because the affiliate PPC ads would "fill in the gap," which might have led eBay to under-estimate the value of Google PPC advertising.)

    At the same time, I assume that eBay used the "pause period" to identify any affiliates who were continuing to run direct-to-merchant PPC ads.

  13. #13
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by markwelch
    What, if anything, should we do to protect the industry from the unscrupulous promoters? Could ABW create a section specifically devoted to this topic, perhaps even "unmasking" some of the schemes and showing the flaws in many of these theories? Should we warn affiliates to be cautious if an affiliate manager encourages them to run PPC campaigns?
    A sub-forum might be a good idea, however, the sub-forum would need close monitoring because this could possibly create a "can of worms."

    I am particularly attracted to the "unmasking of schemes" possibility.
    I think Mark would be excellent at discussing theories (and targeting the fatal flaws).
    I would encourage him to monitor such a sub-forum if one were created. He'd have my vote.
    Affiliate Managers shouldn't apply undue pressure on affiliates to run PPC campaigns; some AMs have urged me to do so and I always respond with a "no can do"
    Last edited by Rhia7; June 26th, 2007 at 12:45 PM.
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  14. #14
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    "The issue, of course, is that most of these "newbie" affiliates are naieve and don't clearly understand the economics involved. Without a clear understanding, these "newbies" sign up for one or more affiliate programs and launch Google AdWords campaigns; even if they somehow create effective ad copy and choose "good" keywords, they will most likely spend far more on AdWords than they earn from affiliate commissions."

    That's business. You learn from your mistakes. We kind of already talk about that when people ask about PPC, the usual advice in the PPC forum we have here. Start off slow, watch your campaigns. And then they can read more about any tips that might help. And then it's basic economics. If you spend more that you make, that's not good. If you make more than you spend, good.

  15. #15
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by Trust
    "The issue, of course, is that most of these "newbie" affiliates are naive and don't clearly understand the economics involved.
    Mark is proposing an analysis that goes beyond "Economics 101."
    His proposal focuses upon "unscrupulous promoters who are selling bad advice about PPC/affiliate arbitrage."

    I'd like to see the fruition of Mark's idea: such would be an interesting educational read plus readers of such posts might become a little more savvy in terms of marketing tricks and scams.
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  16. #16
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    I know in general affiliates will post about anything scammy or fishy usually in the forum it's closest too. And we talk about PPC in the PPC forum. So you want a marketing tricks and scams forum? A general one or just PPC marketing scams? Just trying to understand exactly what you're after. You can always suggest new forums at anytime in the Suggestion Forum:

    http://forum.abestweb.com/forumdisplay.php?f=205

    It's just easier to suggest them there so they're easy to find.

    And then Haiko would decide that. Or you can just start a thread on it.

  17. #17
    ABW Ambassador JudiMoore's Avatar
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    This entire thread is very interesting and informative, but there is also something else entirely going on between Google and eBay.

    Google has been trying to muscle eBay power sellers into the Google checkout system and even scheduled some big event to coincide with a huge eBay annual event. They subsequently canceled their event when eBay pulled all their Google ads.

    Then the checkout system sales crew was escorted out of the eBay party by security.
    The details are fairly easy to find by searching for Google eBay fued.

    The two things might not have anything at all to do with each other, but they have been pretty much going on at the same time this past month or so.

  18. #18
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by Trust
    So you want a marketing tricks and scams forum? A general one or just PPC marketing scams?
    No, that would be too broad. The interest is the focus on "unscrupulous promoters who are selling bad advice about PPC/affiliate arbitrage."

    Thanks for the Suggestion Forum link, that's good to keep in mind.
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  19. #19
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    >>selling bad advice

    who will define "bad"

    If somene tries some advice and it doesn't work, does that make it bad?

    Advice used on "fuzzy blue wigets" might work where the same advice may not work on "penis enlargements" or "phenylamine" or "vodka".

  20. #20
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    Quote Originally Posted by Rhia7
    No, that would be too broad. The interest is the focus on "unscrupulous promoters who are selling bad advice about PPC/affiliate arbitrage."

    Thanks for the Suggestion Forum link, that's good to keep in mind.
    That might be more of a thread type topic and as long as you can back it up. I'm all for outing the bad guys. Once you call somebody unscrupulous/scammy or are ripping people off, you need something to back it up or you leave yourself open. And what Adam just said. There is straight ripping people off and then there are things were you might get some advice and it might not work for you but might for others.

  21. #21
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by Trust
    That might be more of a thread type topic and as long as you can back it up. I'm all for outing the bad guys. Once you call somebody unscrupulous/scammy or are ripping people off, you need something to back it up or you leave yourself open.
    I'm just echoing Mark's original opening statement and staying on topic within this thread

    As for definitions of who's the scammer and would one method possibly work with widgets or with anatomy enhancement, I'm not the one with the definitions here.
    I voted for Mark to take a leading position. Mark can create a base of definitions if he so chooses, or a group of people interested in taking an active role and knowledgeable on this topic could contribute to the definitions and analysis.
    If a committee would/could be formed, that would be interesting.

    I applaud Mark's initiative, that's all I'm doing.
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  22. #22
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    Committee?

    "Could ABW create a section specifically devoted to this topic, perhaps even "unmasking" some of the schemes and showing the flaws in many of these theories?"

    Do have an example? Still not following exactly.

    As far as:

    "Should we warn affiliates to be cautious if an affiliate manager encourages them to run PPC campaigns?"

    What's wrong with that?

  23. #23
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by Trust
    Committee?
    Yes, it would be interesting if a group of ABW members took the time to contribute to such a thread/sub-forum.

    The "panel of [authoritative] writers [i.e. 'the panel']" would be composed of those with experience in the topic. This is Mark's idea, he could "invite" some panelists. There are some members of ABW who would make excellent panelists. Members who are interested in joining the panel could nominate themselves and Haiko could give the or thumbs down.
    It could be really interesting.

    There could be a question & answer panel.
    The questions [and perhaps some possible topics of debate] would come from those seeking the wisdom of the "authoritative panel."

    Quote Originally Posted by Trust
    "Should we warn affiliates to be cautious if an affiliate manager encourages them to run PPC campaigns?"

    What's wrong with that?
    It would only become a problem if the affiliate managers were overzealous.
    Last edited by Rhia7; June 26th, 2007 at 02:50 PM.
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  24. #24
    The Seal of Aproval rematt's Avatar
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    The word "Scam" is very subjective. A particular process or methodology may work for someone like Trust or Donuts because of their years of experience and may fail miserably for me. Does that make that process a scam?

    Labeling an e-book, process or methodology a scam is very dangerous unless there is indisputable proof that they can in no way deliver what they promise, are promoting something illegal or so blatantly bad that most would see through it anyway.

    I've never purchased any of these e-books, I've gotten most of my education through ABW and my own mistakes (and successes), but from what I've gathered by reading a number of posts on ABW is that they are usually full of information that the purchaser could have found free by searching the web (or visiting ABW) or the information is outdated and no longer useful. Neither of these scenarios constitute a scam.

    There will always be "Get Rich Schemes" and there will always be people willing to spend their money on the promise of "less work for more money" and guess what - you can't protect the second group from the first.

    As opposed to a forum on scams and useless e-books I'd prefer to see a consolidation of information that is already contained in the forums here that helps noobs and experienced affiliates grow their business in an honest and ethical manner. After several months here I am still searching and reading posts from 2 or 3 years ago and learning something new every day. You don't need to highlight a PPC scam if you can point to the numerous threads on how to do it right. The problem is that ABW members already have all of this information available, it's the unwashed masses that are susceptible. How do you reach out to them? The best thing that can happen to them is to find ABW and read everything in sight.

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  25. #25
    What's the word? Rhia7's Avatar
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    Quote Originally Posted by rematt
    The word "Scam" is very subjective...Labeling an e-book, process or methodology a scam is very dangerous unless there is indisputable proof...
    I didn't interpret Mark's suggestion as wanting to label actual things or people.
    Mark is not the type to start threads that besmirch a person's reputation.
    I interpreted Mark's suggestion as an interest in types of philosophy [in this case related to the subject matter of PPC/affiliate arbitrage] such as "Prisoners' Dilemma" [a type of situation that many muse upon and write articles on].
    If you check out Google there's about about 1,730,000 hits for prisoner's dilemma.

    I'd love to read abstract profiles about PPC/affiliate arbitrage in the same way that I actually enjoy reading about the "Prisoners' Dilemma theory."
    Such would be very educational and also somewhat entertaining.

    I see his potential thread or sub-forum (there'd have to be an interest to justify it) as [the] educational dissecting of theories much like the theorems of geometry or calculus -- pure theory, not attacks upon people.
    Last edited by Rhia7; June 29th, 2007 at 05:42 PM.
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