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Affiliate marketing is receiving some not so great publicity…again. This time it comes from Rik Ferguson over at TrendMicro blog as he reveals a Facebook Account Upgrade Scam, where fan pages promote a Gold Facebook account upgrade. Of course, there is no such thing as a gold Facebook account.

From Rik Ferguson’s blog post (bolding by me for emphasis):

So what’s the point for the scammer? Well if you follow all the instructions, you first invite all your friends to come and check out this (cough) great deal. Then, if you are credulous enough to click the button, you are informed that in order to access the Account Upgrade page you must complete “1 quick, free survey”, different versions of the scam page offer different surveys, but this is where the money is made.

The survey I tested linked (via a couple of affiliate marketing services) to a “Werewolf vs. Vampire” quiz which promised to tell me which I am (surely I should know that already?) at the end of the ten questions I am invited to enter my mobile phone number to receive my results. If I do that I am agreeing to pay a £9.00 joining fee followed by £9.00 every week until I cancel my membership via SMS.

Of course, I immediately wanted to know which affiliate networks were involved considering TrendMirco’s report of around one million Facebook user’s being subscribed to the numerous fake gold account fan pages.

The Gory (Albeit Probably Boring) Details

Although, it was stated that the scam had been reported to Facebook and the content was most likely being removed, I got out my shovel and began digging. A quick Google search showed the content was being removed, but I was able to quickly pull up some of the offending pages courtesy of Google cache (see below).

The first thing I noticed was that the affiliate behind the fake Facebook upgrades appears to be geo-targeting the offers displayed to the end user. While Rik Ferguson obviously received UK cell phone offers, the offers displayed to me were US based offers (see below).

The actual offers differed at times, but all pretty much followed the same CPA network click stream. The irony of one of the quizzes being called “How Dumb Are You” was not lost on me.

The domain responsible for the above display on Facebook is corporate-promo-mfg.com. This domain was consistent throughout all of my research.

The affiliate link on corporate-promo-mfg.com is for CPALead with the publisher id 42109. Whois records for CPALead.com show the company as located in Wisconsin. The contact information on their web site indicates they are located in Las Vegas, NV.

CPALead redirects the click to click2go.org with an affiliate id of 3013 and sub id 42109 (passing the original publisher id). Click2go uses a Privacy Whois service, however the IP Location is tied to TattoMedia.

TattoMedia is certainly a player in these types of SMS ads and I’ve come across them numerous times in connection with adware usage. At this point, CPALead is acting as an affiliate/publisher of TattoMedia.

Click2Go then redirects the click to webventures.directtrack.com with the aff id CD43 and sub id 3013 (the id for CPALead as an affiliate with TattoMedia). Note that at this point, the original affiliate/publisher id is no longer being carried through on the actual tracking links. If you go to webventures.directtrack.com, you are brought to a sign-up page for MundoMedia.com. MundoMedia uses a Privacy Whois service as well, but their web site shows contact information for Toronto and Los Angeles.

MundoMedia  redirects the click to linktrack66.com containing the same aff id and sub id. Linktrack66.com is another tracking domain associated with MundoMedia.

Finally the click is redirected to MyMindQuizzes.com where the actual survey resides. MyMindQuizzes also uses a Privacy Whois service but resides on the same IP address as MundoMedia. Sometimes CPA networks will host a sign-up form for an advertiser on their own servers; other times it may be the CPA network themselves in ownership of the offer.  Looking at the Terms of Service page on MyMindQuizzes, I found mention of the company name Neo Image.

The short version is I found three CPA Networks involved in these deceptive Facebook ads: CPALead, TattoMedia and MundoMedia.

The Plot Thickens

You may be asking yourself “So what, the fraudulent ads were reported and Facebook removed the pages. It’s just a little bit of bad PR that will most likely quickly fade in people’s memory.”

If only that was case. The reality is that people who are making some nice change, regardless of how they are making it, aren’t always willing to give it up quickly. TrendMicro reported the incident on Monday. On Wednesday I did a search through Facebook (not Google but Facebook) and I found several new and active fake Facebook Gold Account fan pages with fan totals in the tens of thousands. When I viewed the profile pictures of one of these new accounts I saw pictures were added Monday. Even while Facebook was removing pages, new ones were evidently being set up.

Some of those pages are now gone, but I see new active pages again today with one simple search.

And while Facebook may be attempting to keep up the affiliate links involved remain active. There does not appear to have been any termination of the affiliate account by the CPA networks. Indeed, if you recall I went from a Google cached page on the account on Facebook to even track which CPA Networks were involved.

The Implications

There are several implications to this type of situation. The most obvious is  while the incidents were initially reported in the UK, they are now happening in the US as well. There is no way this ad promotion will meet the FTC guidelines regarding deceptive advertising practices. You don’t have to be a lawyer to figure that one out. When you start hitting numbers of consumers in the million plus range being potentially impacted, it’s almost like screaming for the FTC big stick to head your way. Everyone in the click stream trail is at legal risk.

What about those consumers? If you look at the last screen shot I posted, you’ll see that Facebook groups against this one particular scam are beginning to form. I’ll hazard a wild guess and say consumers aren’t happy about it either.

Is it a wonder that security companies tend to be less than affectionate towards affiliates? This type of activity certainly doesn’t help our case, particularly when they have seen affiliate links tied to scams, adware and the such for years now.  It should be noted that Rik Ferguson didn’t say “CPA Network affiliates”, he said “affiliate marketing”.

The lack of transparency build into the sub-affiliate model should be neither an inherent excuse nor a mechanism to hide behind when it comes to ensuring fraudulent activities do not tarnish and stain our whole industry. It’s not like we are talking about an affiliate who is capable of generating only a limited number of ad views.  If a network cannot monitor traffic from an affiliate at that level, then they probably shouldn’t be a network.  CPA Networks must become more active in establishing acceptable marketing practices, monitoring their programs and taking action on offenses within the industry and as an industry, we must be clear to those outside of our industry, including consumers, that these types of fraudulent marketing practices are unacceptable.

These types of incidents impact our industry as a whole and how we function and navigate within it.  Please stay tuned for Part Two of the post.

I wish that I could say “the end” but it’s not the end of story.  That’s will Part 2 of this post.

Go here to read the rest:
Black Hat Affiliate Tactics in the Facebook Era

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“You can’t put the genie back into the bottle” or so says the idiom. The issues surrounding adware have certainly been a “genie” for affiliate marketing.  We may have the opportunity to see if that genie really can be put back into the bottle, at least for a sub-set of adware applications, toolbars.

Yesterday Brian Littleton, CEO of ShareASale, announced a Toolbar Roundtable Discussion for next Tuesday.  The purpose is to receive input from the community for establishing guidelines for toolbar behavior within the ShareASale network.  This is a shift from the historical policy of ShareASale which has not allowed software in the network. Not unexpectedly, there is some heated discussion around the announcement in the ShareASale Forum on ABestWeb.com.

Many people mistakenly think that I am opposed to adware. This isn’t the case. Adware is just technology, which isn’t inherently good or bad. It’s just technology…ultimately a bunch of 1’s and 0’s strung together to elicit preplanned behavior from the computer of the end user.

What I have opposed over the years is the manner in which many adware applications generate revenue in the affiliate marketing channel.
I have been exceedingly frustrated at times by technology being abused to the point of causing schisms within our industry and stigmatizing the technology itself which, in reality, could have been positive for the affiliates, merchants, networks and consumers it was meant to serve.  On more than one occasion I have stated that adware does not have to be an issue within affiliate marketing.  For years now I have worked outline a model for adware behavior. Not once have I been asked the details of that model, at least until now.

My view is broader than just toolbars. I personally feel that it is possible for any adware application to be respectful of the rights of other internet businesses, benefit the consumer, and generate legitimate revenue, directly and/or indirectly, in the affiliate marketing channel. I now have the opportunity to share some of my views and thoughts on how this can be achieved.

There is a glaring reality that we cannot afford to overlook: the technology is here and it’s not going to suddenly go away. The genie isn’t going to just disappear. My contentions have been with the policy, both written and how acted upon in reality, for how adware is allowed to behave in the affiliate marketing channel. My mantra is behavior, behavior, behavior (to the point I get tired of hearing it myself!) not toolbar, widget or desktop app. I don’t have a problem with Google’s toolbar, but I do have a problem with most software generating revenue through the affiliate channel.

To this point, there has been two primary types of policy by networks and merchants regarding how affiliates can use software in the affiliate channel: not allowed at all (the parasite-free policy) or allowed under a set of conditions that are far less restrictive for affiliates than marketing through other means (the COC/Addendum policy). I have always been opposed to the COC/Addendum policy because I feel it allowed revenue generation that facilitated unfair competition and diminished the overall value of the affiliate channel. I have longed for a working policy (policy that is actually being used) that would address how software can be legitimately used within the affiliate channel sans all the controversy. Indeed, I strongly believe it is critical that our industry be able to produce such a working policy.

Why? So we can demonstrate our ability to self-regulate and foster the healthy growth of our industry. All established industries need to demonstrate this ability for long-term success. To this point, I don’t think we have been able to demonstrate an ability to effectively self-regulate the very technologies our industry depends upon. Affiliate marketing is a technology business after all.

There are currently various technologies used by affiliates in their marketing efforts.  Web sites, email, video, widgets and many other forms of technology are common.  Guidelines for acceptable use have been established for promotion though most of these technologies. Granted, there may be an occasional debate regarding a new way these technologies are used, but none have been as problematic as downloaded software. Nor has a policy of all or nothing been applied to defining their use by affiliates.

Any and all of the technologies used by affiliates can be potentially abused. Questionable revenue generation tactics as well as more malicious behavior can occur through any promotional method. We certainly don’t say that affiliates cannot use web sites, email, and video or social media technology as promotion mechanisms because the technology can, and at times is, abused. Of course we don’t! We set guidelines and then we work towards enforcing those guidelines.

Enforcing a policy for toolbars will not be without its own challenges. But all monitoring of promotion comes with unique challenges. There are millions of web pages, owned by the affiliate or by someone else, where bad behavior can occur. However, once policy is established for promotion through a web site, protocols for monitoring are developed.

While practices may not always be policed by some companies to the degree some desire, we all understand that ultimately it’s a matter of survival for our livelihoods to have a certain degree of self-regulation within these technologies.

The landscape has changed dramatically since 2002 when the COC/Addendum policy was released by the major networks of the time. There is no longer a huge cost barrier for any affiliate having downloadable software and there are several sources for acquiring your own toolbar for free or at a very low cost. Distribution channels are available that do not require bundling, especially for toolbars. This has resulted in literally tens of thousands of toolbars available for download.

Of course, not all of these operate within the affiliate channel, but there is an increasing number which do. Toolbars can engage in a very wide range of behaviors. I don’t feel that a global policy of   “X is not allowed” to be an adequate manner with which to address issues facing our industry in regards to a technology that is not going away.

Brian Littleton has outlined a starting point  on the ShareASale blog for this policy discussion. As someone who has always focused on how adware can behave with regards to revenue generation, I am intrigued by his initial points. He appears to be envisioning toolbar technology used as a marketing vehicle versus a customer service vehicle. Marketing practices would use the toolbar for direct revenue generation, which is the most common use seen to date. Customer service would involve behaviors focused on the consumer experience, thus building branding, loyalty, and visitor retention for the affiliate’s own business. This form is a more passive marketing of the affiliate’s own business and does not tie the toolbar directly to  the affiliate link for tracking a commissionable sale. While I still believe software can behave “nicely” and be used for more direct revenue generation, I find Brian’s outside of the box thinking on this issue very interesting.

We need to show that we are up to the challenges of regulating the very technologies used to enhance and bring value to the affiliate channel. I’m excited to see a company with a track record and reputation as established as ShareASale’s stepping up to the plate to undertake the task of presenting meaningful policy in regards to toolbars. I look forward to having a policy in use that I can point to as an example of how software technology can be used in a harmonious and productive manner.

Will ShareASale be able to put the genie back into the bottle? I don’t think the technology can go back into the bottle. But can we have the benevolent genie? I think so. The real challenge will be whether or not ShareASale can overcome the stigma that has become attached with downloaded software, turning what has been somewhat of a black eye for affiliate marketing into a positive.

I will definitely be at this Roundtable that Brian has facilitated. I encourage any and all who care about the policies driving our industry to attend as well. I’m hoping to see as many merchants as affiliates in attendance as this is not an affiliate issue but an industry issue which impacts all parties in the equation.

Read more from the original source:
Putting the Genie Back Into the Bottle

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New York Wins First Round

In what hopefully will not be a “one and done” situation New York Supreme Court Judge Eileen Bransten handed down separate dismissals against Amazon and Overstock. Essentially Bransten granted New York State’s position that affiliate presence within the state gave Amazon and Overstock a nexus that could be taxed. The so called “Amazon Tax” would set a dangerous precedent, as written it is tortuous in structure and in essence violates the Commerce Clause of the U.S. Constitution. Hopefully Amazon and Overstock will take the fight to the New York State Court of Appeals.

Layoffs Continue

With the Holidays and the New Year for a moment it was almost possible take one’s mind off the layoffs. Circuit City’s announcement this week that is closing all 567 of its stores brought everything back to harsh reality. The closure impacted the jobs of over 30,000 employees.

Recent other layoff announcements include:

Motorola – Had the biggest other announcement this week cutting 4,000 jobs an undisclosed amount of its workforce
AMD – Eliminated 1,500 jobs about 9% of its staff
Google – Let go of 100 jobs about 1% of its workforce
Federated Media – Cut 7 jobs about 7% of its staff

Century 21 Shifts from TV to Online

According to AdAge, Century 21’s Senior VP of Marketing Beverly Thorne stated the company was making a strategic move shift its advertising efforts online. The shift came as an effort to ensure maximum return for our brokers and agents. Media agency Beyond Interaction will be leading online campaigns for Century 21.

More Signs of Dropping CPMs from Pubmatic

Ad service Pubmatic reported a 48% drop in year-over-year CPM rates throughout its network partners. Rates fell from a $.50 eCPM to a $.26 eCPM in Q4 of 2008.

Affiliate Summit Announces Pinnacle Award Winners

Last Monday, Affiliate Summit held the Annual Pinnacle Awards gala. This year’s winners are:

• Affiliate of the Year – Mike Allen (Shopping-Bargains.com)
• Affiliate Manager of the Year – Angel Djambazov (JonesSoda.com and Keenfootwear.com)
• Exceptional Merchant – CelebrateExpress.com (Managed by Renee O’Banion)
• Affiliate Marketing Advocate – Melanie Seery (Who put together the initiative to support New York Affiliates)
• Best Blogger – Scott Jangro (Jangro.com)
• Affiliate Marketing Legend – Kellie Stevens (AffiliateFairPlay.com)

Congratulations to the winners of Affiliate Summit’s Pinnacle Awards.

Games Boost Mobile Transactions on Social Networks

Want that virtual shotgun for MobWars? Well you are going to have to pay real money for it. So who is powering those transactions? Well while US companies and carriers are figuring out the mirco-transaction game two European companies already have pretty good traction with the social network market. Mobillcash and Zong power many of the transactions on such platforms currently. It will be interesting to see how advertisers take advantage of such platforms, how fast US firms will move to fill the space, and how bad the fraud against consumers will get.

Read more:
Cashing Out: Week of January 11-17th, 2009 in Online Marketing News

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There are not many things that can bring affiliates to band together. Cheating them out of their commissions is one sure way to do it.

As technology grows the various affiliate networks, rather than adapting the way their compliance departments look at affiliate tactics, have chosen to ignore the practices of affiliates whose tactics while technically legal break the very agreements set forth by the networks themselves. The networks do so for a variety of reasons: a) often the advertiser/merchant is unaware of the situation; b) it is difficult to keep up with new technology; c) the networks still get paid for such transactions; and d) not enough sustained pressure is put on the networks to change.

While the networks benefit this is not a victimless situation. Affiliates who play fair are cheated out of their commission. Advertisers end up in some cases paying double for transactions and more importantly loosing the source that brought them the customer.

This problem has been around a long time. Folks like Ben Edelman, Kellie Stevens, Center for Democracy and Technology, and ABestWeb (see current discussion with multiple videos on a toolbar by One Cause) have made various attempts to make networks enforce their own rules. After all, how else are they going to earn the role of “trusted 3rd party”?

Personally I feel education is the only way to put pressure on the networks. Education of affiliates as well as merchants. Which is why I am glad to see Scott Jangro, former Director of Product Management for BeFree and Commission Junction and one of the smartest folks in online marketing, compile an informative series of videos that display these tactics in layman’s terms. If you are an affiliate or a merchant get informed on how this technology impacts your business.

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As an editor there times when you find yourself torn between personal/public sentiment and the journalistic ideal of providing a neutral forum. Last month with the dust-up over having Hydra as an advertiser when our authors are calling for an association to promote ethical standards, Hydra’s subsequent response, and the discussion of when it is appropriate to drop an advertiser, has lead me affect a change in Revenews advertising policy.

Effective immediately: Any potential direct advertiser who in the 12 months prior to requesting an ad does not maintain a clean record will be denied placement. Clean record shall constitute not having the advertiser’s business tactics identified as being unethical or harmful by Ben Edelman, Kellie Stevens, Center for Democracy and Technology, Sun Microsystems, the Webwatch Project, not having been fined by the FTC, or currently in a lawsuit with a state attorney general.

Ultimately Revenews does not seek to become a watchdog group and the final decision on whether or not to accept an advertiser will still be the burden of the editor. However I have seen good people like the folks at ABestWeb, the PMA, Avantlink, ShareASale take steps to improving the makeup of our industry. I applaud their efforts as well as the efforts of those listed above who spend time and energy being vigilant. I think it is time Revenews makes a stand as well.

See the original post:
Hard to Make a Stand

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