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CJ to implement new fee for affiliates w/o sales

What a crock

         

spikedo55

1:47 am on Feb 27, 2003 (gmt 0)

10+ Year Member



I just got an e-mail from Commission Junction about a new Publisher Service Agreement they are instituting. Here's a quote:

"<snip>

I have no clue how they will collect this. I'm figuring it is designed to get rid of a lot of non-performing affiliate sites. But isn't it a bit harsh? What do you all make of it?

Spike

[edited by: Woz at 2:33 am (utc) on Feb. 27, 2003]
[edit reason] TOS#9 no email excerpts please. [/edit]

gsx

10:59 am on Mar 1, 2003 (gmt 0)

10+ Year Member



It sounds a bit strange, I mean if you advertised your site in a magazine, and it did not perform - would you charge the magazine? I don't think so. It seems a highly unprofessional way of working. If this is costing them money, then the merchants should pay a slightly higher fee - they are the ones getting the bigger results (or at least should be!). But of course, they will be afraid of losing the merchants, but less advertisers may result in just that.

Blade

12:59 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



So, you have been luck and earned $99.99 BUT unlucky in not earning anything for the following 6 months. Under this scenario, CJ will take $10.00 from your $99.99 every month until all is gone then close your account. Your $99.99 was then all for nothing.

I wonder how the advertisers will feel about their affiliates having legitimately earned commissions stolen this way and what legal bases do CJ have in taking this hard earn money from affiliates?

Its all very well saying if your not making money in 6 months then why bother, but for some, making even small amounts is not easy at all and can take longer than 6 months to build a working affiliate sales strategy.

Eric_Lander

2:24 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



I haven't seen the emails because I've never participated in any CJ programs. I've heard many things, and referred vendors to use them when the situation called for it -- but perhaps now it is time to change that.

From what I gather about CJ's way of working, it shouldn't be difficult accumulating some income over a period of 6 months. I do think though, as opposed to requiring a $10 fee as a voilation of this, they would be much better off simply removing the member based on inactivity.

That way, they're not burning any bridges. Just one man's opinion though.

casperkor

3:43 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



C.J. got an immediate ear-full right back from me.

I told them how tacky and un-professional this makes them
sound. I just signed up with them last month and most of that time my site (being new) was dropping in and out of the index.

Finally I am getting about 1400 uniques per day and around 2500 page views. I am not so impressed anyway with the affiliate program thing thus far. I have put up several
banners for several merchants and what not and have made only 9 dollars (not even from cj).

Does anyone know how many visitors a day I have to be receiving to see better results from these affiliate programs? Also, are banners or just simple "text" links
better?

running scared

3:53 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



I have a site that I had tried out a couple of programmes with. I never bothered persuing them properly because I had better things to do so this e-mail has just encouraged me to remove all the links.

I don't see the idea of discontinuing accounts if no results are achieved as being a problem. However it seems that the mechanism of charging $10 is just making life much more complex than it needs to be.

rcjordan

4:09 pm on Mar 1, 2003 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



> If you can't make a commission check in 6 months, why would you care to be on the network?

I've parked CJ for the last 6 or 8 months, so I'm one of the publishers that will have to decide whether I want to stay or go. That said, I agree with Drastic, if you're in the game at all you can make this a non-problem with a flick of the keyboard. Sure, there are all kinds of what-if scenarios that we can dredge up, but the fact is this is a standard business practice. Even here at WebmasterWorld, the membership files are purged due to inactivity. And it's very, very common in the bricks world.

Is it a nuisance that I don't want to have to bother with right now? Yes, definitely. Is it a big deal to me? No.

Brett_Tabke

4:29 pm on Mar 1, 2003 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



Most you have this scenario figured wrong.

>...purged due to inactivity.

That would be fine, if that is what was happening - I don't think it is.

You have to go ask them to delete your account RC. There is no voluntary purging - looks like it is all on you to Opt Out or get billed.

Mike_Mackin

4:55 pm on Mar 1, 2003 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



It will cost them $5 to send a bill.
How can they collect it?
Sue for $10?

OntheEdge

4:55 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



Brett, that's called Negative Billing, and its illegal. However if you read the fine print it works like this:
Inactive for 6 months...you are charged $10. they mail you your balance. Your account is then zeroed out. A zero account will then be closed.
Therefore: anyone with a zero balance will not receive a bill for $10
But: If you have a small balance, then you pay it.
On the Dead wood issue:
Dead wood costs..database management at minimum.

What is happening here is the normal (albeit money grubbing), growth process of a dot com.
First they start off hungry, they'll take anyone.
Then they start getting selective.
Then nothings free and the little guys who helped them build their business in the first place get the door slammed in their face.

They're not done yet, more surprises will come.

rcjordan

4:59 pm on Mar 1, 2003 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



>purge
This is what I was referencing:
the quarterly member file weed. Those members who have not logged in, sometime in the last 120 days will be weeded. (those with more than 50 posts are exempt). This keeps the member files clean and duplicate free.

[webmasterworld.com...]

OntheEdge

5:01 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



Here's another thought...
They do not offer the option to pay the $10. No activity=purged.Period.
You have a cj account, you are on the axe list, but your site has just started to make it and you feel you will soon benefit from the affilates.
The only way you can keep going is to click on an affiliate link on your own site and make a purchase yourself...thereby buying yourself six more months.
Pretty sneaky, wonder how many will resort to that?
Small price to pay if you think you are just about to cash in on all those months of hard work....

rcjordan

5:09 pm on Mar 1, 2003 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



As for the charge, they can bill me all they want, whether I decide to pay it is up to me and my own interpretation of whether it was a legitimate charge or not. In this case, I've been adequately notified of the changes so the ball is in my court. In terms of a policy change on-the-fly, I see this as similar to what my bricks companies and my competitors do when we decide to implement a minimum billing fee or service charge. As for the CJ change, I'm very likely to just sit on it and see what shakes out, then either pay the bill and quit their network or pay the bill and reactivate. This is one of those examples why they coined the phrase "Terms subject to change."

[edited by: rcjordan at 5:13 pm (utc) on Mar. 1, 2003]

iJeep

5:12 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



"The only way you can keep going is to click on an affiliate link on your own site and make a purchase "

Either way CJ gets your money. Isn't that the goal?

I just got this letter too. At first I was thought, "Oh crap, now I have to try to remember my password so I can go cancel my account". Then I read they will just delete my account if I don't have $10 in it. HOPEFULLY they stop sending me all of those spam e-mails trying to get me to advertise new companies and other crap that I do not want.

As far as the weight of this dead wood. I would say that all of my information on CJ takes up maybe 1kb (being generous here) of database space. Obviousley it is going to be small because I never made a sale and had few click-thrus. $10/mo for 1kb, they found a better hosting service than those picture hosting web sites.

Brett_Tabke

5:19 pm on Mar 1, 2003 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



Well I will have a day into cleaning this up Mike. I've got 12 former clients who we signed up for a specific program through CJ. The program was dropped from CJ after two weeks. Hence - 12 abandoned accounts we never gave a second thought too a year ago. Now they are all asking me why they are getting a letter stating they will be billed for a service they couldn't use. That means 12 emails from them - 12 followups - 12 "get my password" - 12 acks on the passwords - 12 logins - 12 followups to see if CJ ready does drop the account. I'll have a day into this before it's done. I get $3500 a day for consulting. Who should I bill?

Rick_M

6:33 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



Interesting. I had a fairly different take on this. I thought they were saying that if you are inactive, they deduct $10 per month from your balance until it is zero, then they close it. If they are actually sending a check for the remaining balance after a $10 charge, then they are being very nice actually.

It would probably be "nicest" if they just paid everyone their outstanding balance and then closed the accounts. However, I would guess they have a decent amount of money owed between all of these small stagnant accounts which they want off the books. So, what are their choices?

1. Pay all balances owed on stagnant accounts and then close them, many of which are probably worth less than the cost of the stamp.

2. Take their approach, which they figure would only hurt the stagnant users who don't produce for them anyway. By charging $10 and then mailing the rest, they avoid having to pay what is probably a huge amount of accounts that are under $10 and not really worth processing and mailing a check. Those that have not been producing, but have over $10 will be glad to get any money, as they never would have seen the check anyway. I wasn't aware that they are going to mail the balance after the $10 charge though - but I didn't read all the fine print.

3. Leave the accounts stagnant, which shows probably a nice chunk of change in their debts owed. Not good for them, and not good for the publishers that have an outstanding balance but aren't producing - they are probably figuring they will never see that money anyway. I doubt there are many (if any) people who have been sitting at $90+ for the past 6 months.

If they are in fact mailing the balance after the $10 charge, they are doing a very nice thing to those affiliates that are not producing. If they are not going to mail the balance, but keep charging $10 / month until the account is closed, they are not being very nice, but it is the best finanacial move. Not many producing affiliates are likely to leave over an unfriendly move that doesn't effect them.

Rick_M

6:48 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



Just to clarify, here are the main relevant parts from the agreement (if this is copywrite violation, please edit this moderators):

"If Publisher has not earned a Payout for six consecutive calendar months, a dormant account fee of US$10 per month shall be applied to Publisher's Account each calendar month that Publisher's Account remains open or until Your Account balance reaches a zero balance, at which time the Account shall become deactivated. Payouts earned by Publisher will not be counted as having been earned by Publisher if the Payout subsequently becomes a Charge-back or until the Charge-back period has expired (if applicable). Publisher may close its Account and terminate this Agreement upon 30 days written notice in accordance with Section 6.1. The number or amount of Transactions, credits for Payouts, and debits for Charge-backs, as calculated by CJ shall be final and binding on You. "

---------------
So, basically, you can ask them to terminate your account and get the balance. Otherwise, they'll deduct $10 per month until your balance is zero, then close it.

OntheEdge

7:35 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



I'm with you on that, but it specifically says if you do not terminate you account, you will be deemed as having accepted it. That is what makes it negative billing.
A Canadian Cable company tried that (yes they had a terms subject to change clause). They gave everybody new channels, then they sent out letters telling their customers if they did not want to pay extra for the new channels, they had until a certain date to cancel. If they did not cancel they would be deemed as having accepted the new products. They lost in court and were penalized for Negative Billing.
This is no different.
That terms subject change clause if you look, you'll probably find that in every contract of this type. It is a loophole, but not permission to negative bill.

OntheEdge

7:36 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



Sidebar: Negative billing is illegal in Canada.... is it illegal in the states?

Brett_Tabke

7:59 pm on Mar 1, 2003 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



They have enough cya language in the tos to cover themselves.

OntheEdge

8:10 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



Yeah, guess your right.
But we've seen what happens to companies who think they're more important than they really are.
One point they seemed to have overlooked though. All those inactive publishers, with all those free banners are going to disappear. How many totally unknown companies got their visability from people seeing a button, even though they haven't clicked one..yet.
How many times does a visitor need to see a button for a new company before they think...hmmm I keep seeing that ad, maybe I'll check them out.

Catalyst

10:11 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



OntheEdge,

VERY good point I had not considered. I was thinking it would help Merchants to minimize some of the non-performing affiliates that tend to lower EPC ratings. Had not though of all the free branding Advertisers will miss out on. I guess there are tradeoffs as well as pros and cons no matter how you look at this new change.

Linda

nativenewyorker

10:23 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



Two points that I wanted to add:

1) Minimum check amounts for CJ are $25, $50, $75, $100 and $250. It is not a minimum of $100 that has been referred to several times already.

2) How accurate is EPC anyway? If someone is starting a new site and making constant revisions to it, the EPC will be distorted and seem to be low relative to a mature site that needs less maintenance.

Ted

dhdweb

10:37 pm on Mar 1, 2003 (gmt 0)

10+ Year Member



I got this e-mail today and I then promptly went an closed my account!

Who needs them, I was looking for an affiliate program when I found them!

Time to start looking again :)

P.S. I also never liked the fact that thier links placed a tracking cookie on visitors computers with out even clicking it!

GarryBoyd

12:34 am on Mar 2, 2003 (gmt 0)

10+ Year Member



I am one of these "underperforming" affiliates.
My site is designed for my own countries local market, and I make sales, either directly thru "buy now" or phone enquiries after they look at my site. However, because I have a few unusual terms at #1 I get about 25% of my traffic from the US. It is useless traffic so far as I am concerned, I can't sell to them, they ask questions that waste my time etc. The only related site with an affiliate program is on CJ. I try and politely divert my US traffic to them. I send plenty of clicks, but no one ever buys.
I guess the fact that their prices are not really competitive and their layout is tedious and confusing could be a problem.

My choice is to either throw away the traffic, or send them on, in the hope the US merchant can sell them. According to CJ the lack of conversion is my problem and I should pay for clicks to get more traffic I can not sell to in order to stay in their network?

kfander

1:58 am on Mar 2, 2003 (gmt 0)

10+ Year Member



I was sending traffic to CJ merchants, but for whatever reason they were unable to make a sale; or they were making sales and it hasn't been credited, for all I know.

I agree that it probably wasn't a very good PR move on their part. Had they simply told me that since I wasn't making any sales, they were going to close my account, I wouldn't have been nearly as offended. As it is, I'll remember to avoid CJ from this point on.

CJ has been far too high maintenance anyhow, so I'm better off without them. Unlike so many others I hear from, I'm doing fairly well with Amazon.com - not enough to earn a living from it alone, but it more than pays the hosting expenses for several domains.

Fairla

6:03 am on Mar 2, 2003 (gmt 0)

10+ Year Member



Thanks to this thread I've finally realized that I misread the email from CJ -- we have to earn a payout or be closed down, not just earn a commission.

Very very stupid of CJ. Not likely to affect me, but if they do bill me even once, I am leaving and I am NOT going back. They must be really desperate for money to throw out the baby with the bathwater like this.

raider

5:31 am on Mar 3, 2003 (gmt 0)

10+ Year Member



I believe a lot of people are being confused by the term "payout." A payout is basically any commission sale that a Advertiser has to pay a commission to a publisher. People are confusing a "payout" for an Advertiser with CJ's "minimum monthly payout". I would think that any website that's even remotely trying to make money, one sale every six months is possible. If not, you are in the wrong business and you should thank CJ for deactivating your account. This is designed to get rid of the deadwood. The people that haven't signed on in months, let alone updated any banners.
Personally, I believe this is smart thing for CJ to do from a business stand point. Let's say they have 500,000 active publishers and 3 million more that's not doing anything. They still have to hire enough staff to do the accounting for 3.5 million accounts. It may only take 1 person to manage the 3 million dead accounts but that is 1 more person than they really need. You can't expect a business to keep incurring unnecessary cost just for the hell of it.
In addition, the only way you could be charged by CJ or end up with a negative balance is, if after recieving a commission check the commission is reversed. Since there's a six month period before your account is deactivated, I don't see much of a chance of a transaction being reversed in the 7th month.
Personally, I believe that if you are reading this thread, then you are an active AM and you have nothing to worry about.

Swanny

11:32 am on Mar 3, 2003 (gmt 0)



Well to be honest, I'm a little disappointed with CJ.

It's definately not just new, unestablished sites that are getting hit.

Eventhough we have sent across over $700 worth of sales in 12 months, we will just fall short of the 6 month window for no sales come March 28, 2003 (literally by days!)

What makes this even harder to accept is we had an order placed just weeks ago which was later reversed by the merchant, not due to a bogus order, but apparently "out of stock" (Though this wasn't stated on their website!)

As we can't justify the $10 charge - the only option we have is to request payment of the outstanding balance and leave CJ.

We have sent across $762.07 worth of sales in 12 months and have a healthy CTR of 1.04%

I'm left wondering if we really are the type of website CJ are looking to weed-out as "underperforming". Anyways we're migrating to Linkshare..

Stephen

nativenewyorker

2:32 pm on Mar 5, 2003 (gmt 0)

10+ Year Member



Swanny,

Welcome to WebmasterWorld.

Why do you have such a severe drop in clickthroughs over the 12 months? $700+ in 6 months and nothing the following 6 months seems unusual.

Ted

OntheEdge

2:41 pm on Mar 10, 2003 (gmt 0)

10+ Year Member



$700+ in 6 months and nothing the following 6 months seems unusual.

Because cj's records are messed up. my account was 3 months old when they send the letter that said "our records show your account has been in active for 6 months"

Has anybody else notice a drastic increase in their linkshare emails since this hit the fan? mine have tripled....at least somebody's on the ball.

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