LinkShare Bestows, Then Revokes, Award For Second Time In A Row
- by Ross Fadner , October 4, 2004
On Sept. 22, LinkShare awarded TheDesktopShopper.com a quarterly Titanium Award, which goes to the affiliate that increased its revenue by the highest percentage over the same quarter the previous year. But, after other affiliates complained on the advertising/affiliate marketing chat site ABestWeb that TheDesktopShopper.com had been blacklisted by several watchdog sites, LinkShare revoked TheDesktopShopper.com's award. However, as many affiliates were quick to point out, this is the second time LinkShare has given its Titanium Award to an affiliate believed to use suspect practices.
TheDesktopShopper.com is one of many domains owned by Sunny View, Inc. known to host several drive-by downloadable software applications at its Web properties, including TheDesktopShopper.com.
Affiliate marketing networks, such as Commission Junction and LinkShare, facilitate affiliate marketing programs through a large network of Web publishers and merchants. The publishers send traffic to marketers via recommended links; many affiliate programs are pay-for-performance, meaning that merchants only pay their affiliates for recommendations that lead to sales. The networks charge for inclusion in the network, and also take a cut from the commissions paid to affiliates by their merchant partners.
But the problem is that some companies have figured out how to position themselves between Web publishers and their merchant partners. The result is that one company can end up taking the credit--and commissions--for another Web publisher's sales.
LinkShare President and CEO Stephen Messer said his company has sought an industry-wide solution to the problem of stolen commissions. He said that other major players in the affiliate marketing space declined to sign an initiative the company drafted to ban suspicious affiliates from the major networks, which, he said, is a major reason they persist today. "People try to build a business around what they can get away with," he said.
LinkShare has its own addendum, which all affiliates must sign in order to become a part of the network. Messer acknowledged that the company in question had somehow slipped through the cracks, having not signed the addendum.
LinkShare has not kicked TheDesktopShopper.com out of its network, and is currently working with the company on how best to proceed. Messer said that LinkShare prefers to negotiate with first-time alleged offenders rather than see them leave the LinkShare network for another competing affiliate network. To date, the company has kicked out a number of other companies, according to Messer.
Analysts in the affiliate market space say that the mishap points to an ever-widening rift between affiliates and affiliate network providers such as LinkShare, Commission Junction, and Performics.
Ben Edelman added that it's "not some kind of anomaly" that LinkShare has given its quarterly award to two alleged violators in a row. Rather, he said: "It's representative of the rampant scope of rule violations--at LinkShare and at Commission Junction too, to be sure."
But as Edelman noted, the problem isn't necessarily a lack of sufficient rules. "What's most needed," he said, "is real enforcement"--adding that "the networks have no incentive to enforce the rules--they only lose financially if they enforce the rules, and so far they've largely gotten away with looking the other way, notwithstanding the resulting harm to merchants."
Kellie Stevens, president and founder of affiliate marketing resource site AffiliateFairPlay.com, agreed. She said that monitoring the traffic and ensuring fair play "falls on the networks." Stevens noted that they cut the checks, and should therefore know where the money is going. "[The networks] know all about this stuff," she said, "but what are they doing to change it?"
TheDesktopShopper.com did not respond to an interview request by press time.
