Affiliate Advertising: Rogue Affiliates Are Dangerous to Your Company's Health!!
Websites often use affiliate advertising to promote their goods and services. That's nothing new....
But what is new is the fact that with increasing frequency, affiliates are using improper—sometimes illegal—methods to lure visitors to the websites they are promoting.
No doubt, you've seen such affiliate ads before: "Actor X looks twenty years younger than he really is—learn how he does it!" or "Lose 50 pounds in a month - it's Hollywood's best kept weight loss secret!"
Often, however, the first time that the owners of the promoted websites learn of their affiliates' improper activities is when the owners receive a cease and desist letter, or a court complaint, alleging that the owners are engaged in unfair or deceptive trade practices.
In their defense, website owners say, "We can't control the activities of our affiliates!"
And you know what? Often the owners are right. But being right doesn't always stop the letters or the lawsuits or the inquiries from government agencies (such as the Attorney General's Office, the District Attorney's Office, the State Attorney's Office—-I'm sure you get the picture).
So, if you use affiliate advertising to promote your site, how can you avoid getting into hot water due to the acts of your affiliates?
Keep reading.....
There are a few versions of the affiliate paradigm, but the most popular version can best be described by the simple chart below.
Here's how it (often) works:
Website owner wants to promote his website, so he retains the services of an Affiliate Network Company.
The Affiliate Network Company manages a small army of Affiliates who are given marching orders to promote the owner's Website. (I only displayed four affiliates in my chart, but in reality the Affiliate Network Company often has hundreds, if not thousands, of affiliates at its disposal.)
The Affiliates then set out to promote the Website.
Usually, the Website owners and the Affiliates do not know each other; the selection and identities of the Affiliates are known only to the Affiliate Network Company.
Affiliates are given a unique identification number by the Affiliate Network Company, and that number is attached to all traffic that the Affiliate directs to the Website. (Tip: If you're really bored and have some time to spare, you can see the number by clicking on an affiliate advertisement, then examining the URL that's displayed. In the URL you'll see the word "subid" followed by a number. That number usually is the unique identification number assigned to the Affiliate by the Affiliate Network Company.)
So what's the problem? The problem is that Affiliates often use improper methods to advertise the websites they seek to promote. Celebrity endorsements, outrageous claims, and SPAM are methods that some Affiliates use—all without the knowledge or permission of the websites they are promoting.
Of course, consumers don't know (and often don't care) that the website owners are oblivious to the affiliates' activities. All they care about is the fact that the website's products or services are being promoted through improper means. And there, my friends, is the rub.
Protect Yourself
Don't get me wrong, I'm not saying that affiliate networking is a bad thing—it isn't. I'm not saying that all affiliates are bad people—they're not. But I am saying that as affiliate advertising becomes more popular, website owners need to protect themselves against rogue (or just plain stupid) affiliates that engage in improper behavior.
Before I tell you how to go about doing this, let me give you my (usual) disclaimer: What I'm about to tell you is NOT legal advice. I'm giving you information, not advice. Don't rely on it without speaking to an attorney first. What you're reading doesn't establish an attorney/client relationship between us. (Almost done....) Don't set up an affiliate relationship without an attorney's help, or else you could find yourself in hot (arguably scalding) water. 'Nuff said.
Ok, here's the moment you've beenwaiting reading for....some information you can use.
If you're engaged in affiliate advertising, then you MUST:
1. Use reputable Affiliate Network Companies. Not all network companies are the same; some have higher standards than others. Do your homework, and find one that has a good reputation for recruiting high quality affiliates. Need a recommendation? Contact me.
2. Have an attorney review the agreement between your company and your Affiliate Network Company. Make sure it clearly states which party is responsible for policing the affiliates' activities. Also, make sure there is a method by which unsavory affiliates can quickly be removed from the pool of affiliates promoting your website. Oh yes, one other thing: make sure your agreement specifically states that the Affiliate Network Company will not tolerate improper or illegal behavior from affiliates.
3. Assign a specific person in your organization to be the "point person" to handle reports of improper affiliate behavior. That person should be responsible for contacting your Affiliate Network Company pursuant to a written company policy. That person should also be responsible for following up with the Affiliate Network Company to ensure that proper and timely action was taken. Do not assume that "someone" will take care of it—assign the person to the job immediately.
4. Let your Affiliate Network Company do the "heavy lifting", i.e., communicating with the affiliates, assigning affiliates, etc. That's what you pay them to do, so let them do it.
5. Avoid direct communication with affiliates (see #4, above).
6. If you have the manpower to do so, search the Internet from time to time for rogue affiliates who are acting improperly. If you find such affiliates, call your Affiliate Network Company immediately and report them.
Want more ideas on how to protect yourself? Contact me, and I'll send you a copy of my white paper, "Managing Affiliate Advertising: A Legal Perspective."
But what is new is the fact that with increasing frequency, affiliates are using improper—sometimes illegal—methods to lure visitors to the websites they are promoting.
No doubt, you've seen such affiliate ads before: "Actor X looks twenty years younger than he really is—learn how he does it!" or "Lose 50 pounds in a month - it's Hollywood's best kept weight loss secret!"
Often, however, the first time that the owners of the promoted websites learn of their affiliates' improper activities is when the owners receive a cease and desist letter, or a court complaint, alleging that the owners are engaged in unfair or deceptive trade practices.
In their defense, website owners say, "We can't control the activities of our affiliates!"
And you know what? Often the owners are right. But being right doesn't always stop the letters or the lawsuits or the inquiries from government agencies (such as the Attorney General's Office, the District Attorney's Office, the State Attorney's Office—-I'm sure you get the picture).
So, if you use affiliate advertising to promote your site, how can you avoid getting into hot water due to the acts of your affiliates?
Keep reading.....
The Affiliate Paradigm
There are a few versions of the affiliate paradigm, but the most popular version can best be described by the simple chart below.
Here's how it (often) works:Website owner wants to promote his website, so he retains the services of an Affiliate Network Company.
The Affiliate Network Company manages a small army of Affiliates who are given marching orders to promote the owner's Website. (I only displayed four affiliates in my chart, but in reality the Affiliate Network Company often has hundreds, if not thousands, of affiliates at its disposal.)
The Affiliates then set out to promote the Website.
Usually, the Website owners and the Affiliates do not know each other; the selection and identities of the Affiliates are known only to the Affiliate Network Company.
Affiliates are given a unique identification number by the Affiliate Network Company, and that number is attached to all traffic that the Affiliate directs to the Website. (Tip: If you're really bored and have some time to spare, you can see the number by clicking on an affiliate advertisement, then examining the URL that's displayed. In the URL you'll see the word "subid" followed by a number. That number usually is the unique identification number assigned to the Affiliate by the Affiliate Network Company.)
So what's the problem? The problem is that Affiliates often use improper methods to advertise the websites they seek to promote. Celebrity endorsements, outrageous claims, and SPAM are methods that some Affiliates use—all without the knowledge or permission of the websites they are promoting.
Of course, consumers don't know (and often don't care) that the website owners are oblivious to the affiliates' activities. All they care about is the fact that the website's products or services are being promoted through improper means. And there, my friends, is the rub.
Protect Yourself
Don't get me wrong, I'm not saying that affiliate networking is a bad thing—it isn't. I'm not saying that all affiliates are bad people—they're not. But I am saying that as affiliate advertising becomes more popular, website owners need to protect themselves against rogue (or just plain stupid) affiliates that engage in improper behavior.
Before I tell you how to go about doing this, let me give you my (usual) disclaimer: What I'm about to tell you is NOT legal advice. I'm giving you information, not advice. Don't rely on it without speaking to an attorney first. What you're reading doesn't establish an attorney/client relationship between us. (Almost done....) Don't set up an affiliate relationship without an attorney's help, or else you could find yourself in hot (arguably scalding) water. 'Nuff said.
Ok, here's the moment you've been
If you're engaged in affiliate advertising, then you MUST:
1. Use reputable Affiliate Network Companies. Not all network companies are the same; some have higher standards than others. Do your homework, and find one that has a good reputation for recruiting high quality affiliates. Need a recommendation? Contact me.
2. Have an attorney review the agreement between your company and your Affiliate Network Company. Make sure it clearly states which party is responsible for policing the affiliates' activities. Also, make sure there is a method by which unsavory affiliates can quickly be removed from the pool of affiliates promoting your website. Oh yes, one other thing: make sure your agreement specifically states that the Affiliate Network Company will not tolerate improper or illegal behavior from affiliates.
3. Assign a specific person in your organization to be the "point person" to handle reports of improper affiliate behavior. That person should be responsible for contacting your Affiliate Network Company pursuant to a written company policy. That person should also be responsible for following up with the Affiliate Network Company to ensure that proper and timely action was taken. Do not assume that "someone" will take care of it—assign the person to the job immediately.
4. Let your Affiliate Network Company do the "heavy lifting", i.e., communicating with the affiliates, assigning affiliates, etc. That's what you pay them to do, so let them do it.
5. Avoid direct communication with affiliates (see #4, above).
6. If you have the manpower to do so, search the Internet from time to time for rogue affiliates who are acting improperly. If you find such affiliates, call your Affiliate Network Company immediately and report them.
Want more ideas on how to protect yourself? Contact me, and I'll send you a copy of my white paper, "Managing Affiliate Advertising: A Legal Perspective."
Posted by Bradley Gross at 7/6/2009 10:40 PM 
Categories: Advertising,IT Services
Tags: online media online advertising affiliate legal
Categories: Advertising,IT Services
Tags: online media online advertising affiliate legal
Comments