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What I am concerned about is that I’ve come across a site that consists mostly of financial affiliate links, plus a directory of web site addresses giving a “Top Ten” of sites for mortgages, travel insurance, loans, car insurance etc. The top three of each of these categories are provided by GoTo UK. Now this site has its own affiliate scheme, and here is the exact wording used to entice new affiliates
“Each time a user clicks through on one of our top three listings within a given category, we will pay you 40% of the click through revenue generated, net of Affiliate Window commission. In fact, during October 2001 we will increase this to 50%!
This means, for example, if a user clicks on the top listing within the Loans category, you will earn 69p*. If they click on the top listing within the Mortgages category, you will earn 56p*. No purchase required. No registration required. (* as on 5-Oct-2001)”
And here is how they describe how commission is calculated
“The first three results within most of our categories are provided by Overture (previosuly known as GoTo). We are paid by Overture each time a unique user clicks on one of those links.
Our affiliate program allows you to share that revenue with us. We will pay you each time one of your visitors clicks on a Overture link.
We pay you 40% of the revenue paid to us by Overture, net of Affiliate Window commission. We have increased this to 50% for October 2001!
You can calculate what your commission will be for each listing, as follows:
1. Find the category of interest below and click on the associated search term.
2. Multiply the 'cost to advertiser' amount of each of the top three listings by 0.139 to give the 50% commission amount, or by 0.111 to give the 40% commission amount.
This is the commission you will earn when your visitor clicks on this link within the xxx-company directory.
NB: xxx-company and our partner, Overture UK, take the issue of fraudulent click throughs very seriously. If a user repeatedly clicks on the same link, you will only be paid once. Our software monitors for fraudulent activity on a daily basis and we reserve the right to remove an affiliate from our affiliate program where evidence suggests fraudulent activity. Further action will be taken where appropriate.”
So there we have it. GoTo UK is paying a commercial website somewhere between 33% and 50% of our click-through charges. The commercial web site is then deducting the percentage taken by the people running the affiliate scheme, and splitting the remainder 50-50 with their affiliates !!. I particularly like the part where they state that they will only pay once for repeated clicks….that’s reassuring isn’t it?.
As a footnote, I emailed Overture (GoTo) last Friday to give them the opportunity to tell me that I was totally mistaken. Daniel from Overture Customer Services has just phoned to say that their client is going to change the wording in their next newsletter, and he appreciates that it sounds bad the way that it’s written….you bet it sounds bad.
This is a legitimate debate. The fact that GoTo are now allowing agents to pay people for simply clicking on top 3 placements affects the ROI and conversion of all.... fact.
It is a question of scale as well. If this practise increases, the impact on ROI will grow accordingly.
Of course you can shrug your shoulders and say that if you don't like it (or the new ROI) don't advertise. But the whole point of this forum is to ensure that people have the facts and can make informed decisions on these matters. This practise has an impact (and potentially a significant impact) on ROI at GoTo, and it is important I believe that people understand that.
Suppose an affiliate or friend of such an affiliate clicks once per day on the top 3 listings in ten of the categories, remember that's just 30 clicks per day, and only once on each listing.
At the end of each month, the affiliate will receive £244.00 (approx $350), the main site will receive £244.00, the people running the affiliate scheme will receive £387.00, and Overture will receive £879.00. The advertisers will have spent £1,759.50, and their logs will show no unusual activity (nobody clicking their brains out, as Mike phrased it).
If you can pick this one click per day out of your logs when the perpetrator is using a dial-up ISP then good for you.
If I clicked 10x from each of these I would start to earn real money: £2,440 per month ($3,500).
The advertisers from those sites would be shelling out £17,595 per month.
Now picture the situation where it is not just one guy doing this... the words spreads... and there are hundreds and potentially thousands.
I just think this is a natural evolution of the Goto biz model. They've been operating under the guise of a 'search engine' for too long. They've never been a search engine to me. They are just "Searchable Advertising" - an online version of the yellow pages.
To see them move to affiliate schemes isn't surprising. I've been expecting them to start setting up affiliate programs similar in design to the DoubleClick or Burst networks. It appears that is starting.
If someone comes up with a way that does make it worth the effort then GoTo will no longer have any respect and lose bids altogether.
So if you plan to make a little extra this month you'd better make it quick.
Right - I have 10mins to build this... anyone got a handy list of 1000 top bids? I'll share any profits if you goto [********...] and click these links :)
On overture's side:
Whose to say that overture can't tell when one person clicks across 30 search terms daily?
On the advertiser's side:
I don't know about you, but I track refferals. If I get 30 (even 10) refferals in a month from and unknown engine showing goto results I'm going to know about it (they can use as many different dialups as they want).
Ross
Did it get resolved?
How? I dial in with 10 different accounts maybe one per hours or so (variable - between other tasks)... totally different IPs. I click on maybe 5-15 returns each time. I delete the cookies each time.
How on earth will they track that as abusive? It emulates quasi typical behaviour. Certainly the thought that financial payment will attract will certainly ensure sufficient emulation.
>> On the advertiser's side... <<
So? If it emulates typical behaviour... different IPs, no clear duplicity, what exactly are you going to say to GoTo?
Their deal is legit. The traffic cannot be shown to be fraudulent. No real case to put.
Sure this could happen now... but it is a hell of a lot more likely if you are putting money into someone's pocket to do it. And the income extrapolated above may well tempt an aweful lot of people.
Well that's how I see it. I have no financial axe to grind as I barely use GoTo. If people wish to believe that there is no issue, no problem. That's the end of my 2c on this thread.
That's the story so far.
As the individual responsible for the above mentioned affiliate program, I believe I can shine some light on this subject!
I notice that our website has not been named above, so I will refer it as ‘Our Website’.
Like Overture, we pride ourselves on being able to direct quality, targeted traffic to our advertisers on ‘Our Website’. Last week, Overture brought to our attention the concern of some of their advertisers; that our affiliate program was open to abuse by some affiliates, as described above.
Since the re-launch of our affiliate program using the Overture revenue, I can confirm that we have had no fraudulent click throughs. Not only is this based on the reports of the fraud detection software we have implemented, it is based on the fact that click throughs from affiliates have amounted to an average of just 6 per day (a tiny percentage of the click throughs we generate for Overture), the majority of these click throughs were for low value search terms and the majority of click throughs came from sites who were already driving traffic to us.
However, despite generating genuine traffic for Overture via our affiliate program (albeit low volume), our primary concern is the satisfaction of our advertisers and Overture’s advertisers. It is for this reason that we have sent an email to all our affiliates informing them that, effective immediately, the commission structure has changed and no longer involves GoTo listings. I hope this swift action ensures that there is no misunderstanding with regards to our intentions and Overture’s intentions towards our advertisers.
Of course, we are all aware that any cpc model is open to abuse. We introduced the Overture based revenue structure as we were confident that should any fraudulent click throughs occur, we would be able to quickly detect them and act accordingly. And I still believe we can. However, I do understand the concerns of some advertisers as ‘Our Website’ and our company is an unknown entity to them, and they do not have access to our log files which illustrate the authenticity of our click throughs.
I hope this clarifies our position.
Kind Regards
Chris Morling
I too don't understand why some don't take your warnings very seriously. I think its an incredibly important and shocking observation that you have made.
I think in my heart of hearts that its not that people DON'T believe you, its more the case that poeple don't actually want to believe you - its too scary to face.
What I realise about Goto is that it appears to be the most expensive PPC advertising available that I know of. For some people, expensive is somehow reassuring and justifiable.
Someone mentioned further up the thread that they believe that Goto will see a tail-off of clients and a decline in bid prices - I doubt this because I don't believe that the vast majority of their clients care enough. They've got cash to burn and they love to spend it.
PPC is a very misunderstood system of advertising. What is seemingly an extremely simple principle becomes something else entirely when one tries to calculate ROI - and compare that ROI with other options.
I'm not trying to be controversial here but these two chaps, Ross & Napoleon are trying to tell you something here - they've spelt it out in as many ways as I can imagine.
Ignore them at your peril.
As for Chris... my views (and I am certain Ross's as well) were certainly not targeted at you personally or your company specifically. It is the concept in general of paying people for directly clicking that is the problem... but I won't go back into it all again.
Chris - I'm happy to totally endorse Napoleons words, it wasn't your problem, it's Overture's. Thanks for the clarification.
Now all we need is for Overture to officially state that payments for affiliate schemes run by their "partners" cannot be based on click through charges from their listings, and we can all sleep peacefully in our beds once more.
Mr Overture......anyone there ??
I hope you didn't take this debate as anything negative towards any individual... Although neither side may agree with the other (and can't understand why the otherside doesn't see things their way :) ) This is definitely not a personal manner (I truly enjoy a good debate).... We do appreciate your contributions to the community....
Cheers!
carlwright 11:09 am on Oct. 15, 2001 (gmt) put it this way:
"I don't know if that can be called 'incentivised' clicking, but our contract with Overture prohibits it."
The outcome clearly indicates that he was correct. Sleep well.
[Overture has read this thread. As a matter of policy they don't post in public fora.]
The only reason I'll sleep well is because I don't have a big budget with GoTo.
5. Wrongful Acts: Affiliate shall not access the Licensed Material through any of the following: (a) "blind links" (i.e. where users do not know that they will be performing a search), (b) links in which a user is persuaded to perform a search in order to obtain some other benefit, (c) Content Related Links or pre-filled Search Boxes, unless specifically approved by Overture in writing, (d) searches from or after 404 or other error messages, (e) "exit traffic" (i.e. when the user is presented with search functionality or required to perform a search prior to exiting a web page), (f) searches required of the user in order for the user to do another function, such as leaving a web page or closing a pop-up window, (g) searches performed upon a user hitting the back button or any other element of the browser, (h) searches in pop-up windows, (i) searches from adult sites, (j) searches originating outside of the United States or Canada, (k) the syndication or delivery of the Licensed Material to any site or application not approved in writing by Overture or to any third party not approved in writing by Overture, and (l) any other method or mechanism that violates Overture written policies, as communicated to Affiliate from time to time (including communication through Affiliate-related areas of Overture's web site).If Affiliate violates any provision of this Section, then Overture may terminate this Agreement immediately upon notice to Affiliate, and the related terms of Section 10 (Termination) and Section 6 (Consideration) apply.
That the affiliate program has been dropped tends to suggest that the words have been acted on ;)
It suggests to me that if you complain and point out the facts, even when some people try to pretend that nothing is wrong, then you can still influence events.
The GoTo affiliate words have not changed in the past 48 hours. All that has changed is that the truth started to emerge about what could happen down this route.
This episode has certainly re-enforced my less than positive views about the nature of GoTo.
As someone who handles a lot of money on behalf of clients I have the responsibility of monitoring referrals and ensuring that the client is getting a decent ROI. In fairness to Overture I too have found my account manager (and the staff in the UK) very responsive to any queries I have had - and I have not had any serious problems with affiliate click through programs to-date (unlike other PPC engines I have tried).
I too would be very nervous about affiliate paid incentives for user click-throughs and would immediately review bids to ensure that they fell below the threshhold which made these sorts of referrals financially worthwhile to the affiliate. I am also sure that Overture are aware of this - and trust that the points raised here will cause reflection (if not action).
Thanks Ross and Napoleon.
Mackin, Todd told me that somebody used activex to force his browser go to a totally replicated goto affiliate engine by default with no way to turn it off.....
....great thread BTW. (I wasted hours responding yesterday, but then decided to delete it.)
