Basic Training for Affiliate Managers

There is an immoral minority in affiliate marketing who wreck havoc and cause headaches to affiliate managers. They stuff cookies, spam blogs, redirect affiliate links, and commit a whole assortment of dirty deeds. We could go the Travis Bickle route and hope that someday a real rain will come and wash all this scum off the streets. But a more reasoned, and effective approach is to take some proactive measures, monitor affiliate activity closely and enforce your terms and conditions.

Terms of Endearment

There are certain truisms in affiliate marketing, like affiliate agreements for most programs are outdated boilerplates. And affiliates don’t read affiliate agreements.

It has long been common that new affiliate programs, especially those without in-house legal counsel, borrow extensively from affiliate agreements used by other companies. In the late ‘90s and early part of this century, it was laughable how many affiliate programs did a find and replace on the Amazon affiliate agreement, and then called it their own. There were hundreds of agreements out there with the same typos as Amazon.

There are a few problems with this approach. The assumption that one size fits all is flawed. If your target market is middle aged men in the Pacific Northwest, the particulars for your program will be a lot different than those of a bookseller.

Also, there’s always a new bogeyman in the industry that needs to be addressed, and you cannot count on other companies to do your homework. Finally, it’s not cool to steal from others.

So here are some issues you should be covering in your affiliate agreement:

  • Adware/Spyware: They’re two different gremlins, but you can cover them in one paragraph. Most programs either forbid them both, or mention neither.
  • Cookie stuffing: Using IFRAMES and other methods, affiliates place their affiliate cookies on anybody that hits their site. So they’re getting credit for the referrals of anybody that visited their site and later bought from yours, regardless of whether the consumer clicked their link.
  • Spam: There are two areas to consider here. Of course, you’ve got your old fashioned email spam, and you’ll want to clamp down on it (want the FTC breathing down your neck?). But a more contemporary strain of spam is when affiliates post nonsense messages to blogs with their affiliate links.
  • Trademarks: Can affiliates use yours in their SEO and PPC efforts? There are two distinct camps here, so figure out what works for you. On that note, there’s also a movement to restrict affiliates from bidding on competitors’ trademarks in order to promote a given company.
  • Residency of affiliates: You could take all comers in the hopes that those sales from China, Nigeria and Tajikistan are not fraud. Or you can play it safe by working with select countries. I generally consider applications from affiliates in Australia, Canada, the UK or the US. Others are reviewed (and usually rejected) on a case by case basis.
  • Banner hosting: Some affiliates are inclined to save your banners and host them on their servers. Don’t let them. When you want to refresh creative, it’s a real bear to try and get all of the outdated legacy creative up to date.

Just the FAQs

You’ve got the updated affiliate agreement, but you’re not finished. Even after you lay out your terms in explicit detail, that doesn’t mean affiliates will bother to read the document when applying.

In fact, affiliates are most assuredly not reading the affiliate agreements, and that can lead to legal liabilities and brand risks for the merchant. According to data I gathered for the AffStat 2004 Report, only 45 percent of affiliates stated that they always read the affiliate agreement.

And really, can you blame them? After all, affiliates join dozens, if not hundreds of affiliate programs. Nearly half of the affiliates I polled have joined 50 or more affiliate programs. And they don’t want to give away ten minutes of their life trying to navigate pages of legalese every time they apply to a program.

I was reading a thread in a marketing forum recently, and somebody asked which affiliate programs permit pay per click search engine advertising.

I replied that whenever you are in doubt, you should read the affiliate agreement, since some programs forbid PPC bidding for their trademarked name(s) and/or certain terms, and if the affiliate is caught, the agreement might stipulate that the merchant has the right to charge back, and/or disallow any and all commissions.

A number of affiliates didn't seem to like the approach of reading the rules first. One replied, "It's always easier to get forgiveness than permission in anything ... just do it."

Since affiliates are not reading the agreements on such a grand scale, I would encourage the creation of a sort of affiliate agreement for dummies. Basically, just utilize your affiliate FAQ as a baked down interpretation of the agreement. Write it in common, simple English and you’ll have a better chance of spreading the word on your terms.

You may also want to consider including questions that affiliates ask frequently in your FAQ. Despite the name of the document, most affiliate programs have a stale boilerplate for this, too.

Doing the Big Brother thing

I like to run my affiliate programs by the rule of whoever profits by the crime, is guilty of it. So I consider it to be a priority to keep tabs on affiliates, and to enforce the terms when they are violated.

One step that helps the gate-keeping efforts is to manually approve all affiliates. During this process, you can check for evidence of adware and cookie stuffing. And if you don’t wish to work with affiliates from certain countries, you can reject them at the onset.

Once they are in the door, it’s a good idea to keep an eye on your referrer logs. This will enable you to see the exact URLs where affiliates are promoting your program. The logs are a useful tool that can reveal whether affiliates are promoting your program from sites other than those they used to apply to your program.

It’s also helpful to see how the affiliates are using your creative, and whether they’re trying their hand at writing some really bad, and factually incorrect copy.

Another detective tool is to simply search for the name(s) of your company and your competitors in the search engines, and determine whether any of your affiliates are bidding on these terms, or any others that you may have forbidden. One third of affiliates are using the PPC search engines to promote affiliate programs, according to the AffStat 2004 Report data.

Lastly, in order to monitor spam, it’s a good idea to opt-in to the newsletters of your affiliates. Yeah, that’s a monster of a task when you’ve got thousands of affiliates. But think about that -- if you cannot effectively monitor the activity of your affiliates, maybe your program is bloated, and it’s time to trim it down to the active affiliates only.

The FTC is looking for examples to trot around as the perp du jour that has violated CAN-SPAM, and they don’t care that it’s a hassle for you to have to spend a lot of time monitoring the compliance of your affiliates.

So you can seed the clouds and hope to flood out the vermin, or you can go on the offensive and take steps to stop the liars, cheaters, forgers and stealers before they get started. And if they beat you on the front end, sic your legal eagles after their back end.

Shawn Collins is CEO of Shawn Collins Consulting, an affiliate program management agency; Webmaster of the affiliate program directory; and a founder of the Affiliate Summit conference. He authored the book Successful Affiliate Marketing for Merchants and the AffStat affiliate marketing benchmark reports cited in this story.