Should Affiliates Be Concerned By Rebate Catchers?
Posted under: Many content affiliates already lament the potential loss of commission to cashback sites and voucher codes, but surprisingly the threat of the rebate catcher seems to have bypassed many! This begs the question should we be concerned?
A rebate catcher is a piece of software or toolbar that activates when a user (who’s legitimately downloaded it) arrives on a merchant site. They’re told about a possible discount code or reminded to get cashback. At the moment they’re not that widespread, but with the arrival of this post at A4U regarding Tradedoubler’s codes of conduct, could this mean we’re about to see more of them?
Whilst it’s nice to see a code of conduct in place before the effect (rather than afterwards as is in the case of click to reveal), there are some serious points missing and not mentioned.
For example would the toolbar activate for a merchant who currently doesn’t have a voucher code? Call me cynical but I’d not put it past an affiliate to show a “does XYZ merchant have a code, click here” via their toolbar or rebate catcher even if the merchant doesn’t have a valid code.
Also when Greasypalm launched their rebate catcher I’m pretty sure there was a “check to see if there was an affiliate cookie live”. If there was nothing popped up. Now I might be wrong, but it was at least a fair way to do things.
As I see it, if you’re a content affiliate who’s remembered to include all the voucher codes and latest offers etc in your well crafted promotions, you could still lose out when your visitor clicks your link. If they have one of these rebate catchers or toolbars up will pop a reminder, they then could go off and pick up another cookie from the usual suspects.
They get the commission, you get nowt!
Hopefully there are real rules in place within the rebate catcher/toolbar code of conduct, or if they’re not they get put in place now! Not next year.. now! And if they’re not in place now I’d go as far as to suggest all toolbars/rebate catchers are banned until all issues are analysed thoroughly.
Interestingly rebate catchers were mentioned on this blog back in November 2008 when the IAB unveiled voucher codes best practice. It concerns me that we now have best practice for what in my opinion is nothing more than legitimised adware designed to benefit the big guys, yet the debate has been fairly mute.
If nothing else this blog will get affiliates, merchants and networks at least thinking about the impact toolbars/rebate catchers will have on the industry – and make sure the loopholes and ways to cheat are nullified from the off.
You’re right about Greasy Palm, they promised not to overwrite an affiliate cookie.
The subject of rebate catcher has been thrown into the limelight again, in part I think, thanks to Nectar creating a ‘toolbar’ which will let you know if you’re earning points on a potential visit, if you’re not, then giving you a link to click on to ensure you’re getting the points you deserve. There’s no such promise not to overwrite, in fact, it’s exactly what they’re trying to do.
This approach is ‘legitimised’ by Nectar by stating that the toolbar is a means for their customers to get the points they are entitled, to us though, it’s a way of ensuring that Nectar get all of the commission for the sales.
So basically anyone with a large reach, can take the commissions from all the hard work of many independent affiliates.
Jason and Jason,
The point about the Greasy Palm equivalent is completely invalid. The question that we should be asking is “does this development from Nectar drive incremental sales”?
Let’s not get caught up in the argument about one affiliate overwriting another. If this toolbar drops cookies that overwrite any other cookie (affiliate or not) or cannibalises a sale that the merchant would have got anyway, then there is no value in it.
Nectar, and Greasy Palm and anyone else who releases something similar, need to demonstrate to merchants that there is value in their proposition. By that I mean that they will achieve sales that they would not have got, they will get more new customers or people will spend more. If this cannot be done then merchants and networks should be saying NO to Nectar, and others. If it is proven, then we should all welcome it as a positive use of the CPA metric.
We have had countless discussions at the IAB over the best way to work with toolbars over the last 6 months and regulation should be coming out shortly. Nectar have been an integral part of that process and one thing that should be brought to attention, is that Nectar have sought opt in from every merchant monetised through their toolbar. Every merchant featured has manually opted in, and so is convinced that it will drive them incremental volume.
Personally, I can see benefits and drawbacks for these kind of software applications but think that the fact that we have been discussing them for a while and drawing up guidelines is an extremely positive thing. I hope that support from the wider community is forthcoming, rather than any form of affiliate vigilantism and bandwagon jumping.
Matt
Matt
Thanks for the comments… yes it’s good that guidelines are being put in place (as I mentioned above), but the blog is for two reasons. (1) I’d like to see all possible issues addressed before they become fact – and iirc the one toolbar I looked at some time ago just said “does this merchant have a code, come here to find it” even if there wasn’t one – that needs to be addressed imo and (2) whilst it’s good The IAB are discussing issues it’s not good that affiliates aren’t. Therefore it’s important to get the information and understanding out in the open so we all know where this is going…. and that things aren’t sorted out in retrospect.
I’m not sure why the GP version is invalid though… it’s a rebate catcher and probably the one most “old” affiliates are aware of… it’s mechanism is known and it’ll be interesting to know if that model is ideal compared to new versions and toolbars.
You might not like the “cookie overwriting” argument… but sorry as an affiliate it’s important. Imo there’s no value when a 100% cashback site picks up commission from stuff I promote to my users…. but you or a merchant may argue otherwise.
But that’s the nature of the beast and often what’s good for network or agency or merchant or affiliate doesn’t always sit well with one or the other groups. Imo it’s also a good thing as we all look at problems from different angles and we should all be willing to embrace opinion rather than try and suppress it.
By being understanding of each other’s views and coming to a mutually beneficial point is the easiest way to the widespread support you desire.
Jason
Hi,
Few points I’d like to raise.
The downloadable software guidelines were discussed by all corners of the industry at length by the whole council (including affiliates) in 2009.
The wording was carefully drawn up after long and protracted discussions.
Just as it’s impossible to talk about ‘affiliates’ as one, homogeneous group, so it’s impossible to lump all downloadable software together however the guidelines are in my opinion a very creditable initial stab at it.
Lets take a step back an address some of the issues here. It’s probably fair to say merchants (and affiliates to a degree) are completely unaware of the rebate catcher offered by Greasy Palm. I don’t want them to be singled out here but as they’ve been mentioned I’ll address the point. It’s also probably fair to say few (if any) merchants have been asked whether they want to allow the activity.
If you were a merchant would you want to opt into the activity? The yes or no answer isn’t the point here as I suspect the majority of merchants would say ‘what is it, what does it do, how does it work, why would I want to, why would I not want to….?’ In other words we as an industry have never talked about this issue collectively or in an orchestrated way.
By bringing the issue to the fore and putting together some strong guidelines on best practice we now have a reference point. We can send this document to affiliates and merchants alike to raise the level of discussion.
So what are the fundamentals of the guidelines? I won’t go through every point they reference but let’s touch on a couple. Well they require every affiliate to split out their activity and be accountable for both selling in their software and displaying the activity and sales they drive through these additional tools. This has never been a requirement before and we’ve effectively been working blind.
They also state merchants must opt-in. Therefore if a merchant sees no value in upsetting “a content affiliate who’s remembered to include all the voucher codes and latest offers etc in your well crafted promotions” they won’t choose to work with the affiliate on their toolbar/software application.
The rules came from a sense that having something in place prior to potentially bigger players coming to market with their applications would avoid some of the voucher code issues.
It’s also useful to make reference to the “usual suspects” reference. There is one obvious affiliate who has a toolbar but I’d encourage people to download it – from my experience it’s non-invasive and passive. Having said that I do anticipate other big players coming to market with similar or more advanced solutions. Will the guidelines address all the concerns these raise? Maybe, maybe not, but that’s the nature of our industry and indeed online; everything we do is built on shifting sands and we’ll adapt those guidelines accordingly.
Regulating for the industry is to a degree impossible, given the hugely diverse nature of all our activity we’ll never be in a place where we please all the people all the time; damned if you do, damned if you don’t.
I welcome debate on this and feedback as networks look to rollout the guidelines with their affiliates. It’s worth noting all affiliates with software in place will now have to offer visibility and transparency to the merchants they seek to promote but retrospectively and in the future. This has never happened before and should be seen a step in the right direction.
Jason,
I’m agreeing that it needs to be brought out into the open, but am arguing that we should not just be looking at this in the context of affiliate marketing, but as part of a clients wider online marketing activity. The discussions clearly need to involve all parties, I’m just wary of kneejerk reactions when all the facts are not fully understood.
Matt
I would imagine after the initial glitches, mud-slinging and arguments, it’ll become fairly self-policing. Either there will become a system where the original cookie owner will share the commission, or alternatively it will be like as now, where many affiliates faced with a choice of two similar merchants to promote, will usually give preferential treatment to the one who has “no cashback sites” as terms of their program. Then it will simply be up to the merchants to decide which advertising stream provides them more sales and income.
@Kevin – thanks for a detail response. Have to say when I looked at the one obvious toolbar it was offering discounts on sites even if there wasn’t one OR if the discount was obvious (e.g. free delivery). That may well have changed as it was sometime ago… but if that was allowable that would be a concern.
But it’s good to know that wheels are in motion – and imo affiliates should feel a lot happier and less concerned about the impact of these things after reading your explanation.
@MattB – the thing is Matt as an affiliate (and maybe it’s just me but I’d guess many others feel the same) I don’t really care about a merchant’s “wider online marketing activity”. My interest is my company and looking after it’s affairs. If something comes along that could impact my business my concern is that and that alone.
But don’t worry the torches, pitchforks and rentamob are on hold
@MattS – thanks for the comment – I do wonder whether toolbars/downloads will have significant take up, and perhaps that might be their biggest hurdle. Do people trust toolbars? And do downloads eventually get ignored/switched off?
The problem with these rebate/cashback toolbars is that there is no distinction between ‘just before you click the confirm button’ toolbar-based sales offers and content websites from a merchant’s point of view. Because of their positioning late in the sale with an opportunity every time the purchaser visits a checkout page the toolbars get away with narrow margins on their higher volume of sales opportunities.
In contrast, the content sites builder needs to create lots of pages or manage a product database and template driven multi-page site and this extra ongoing work to create and keep the site up to date means they can’t afford to split the commission with the customer and remain in business.
What we need are some separate offers – some kind of no-other-discounts-can-be-used-with-this-offer type deal. Keep the toolbars and let them offer their ’10 % cashback / free delivery’ but also have special discounts and offers where no other offers apply and I get to keep the sales commission even where a customer has these toolbars installed (merchant site rejects the voucher code, reinstates previous cookie and informs the user that cashback is not applicable to this offer) .
Also I would have thought providing offers for product affiliates that can’t be hijacked would be in the merchants interests as I presume they would want to keep the brand and product awareness that they get from their product-promoting affiliates and so would want to protect us from losing too many commissions, rather than risk discovering down the road that its no longer profitable to do a content site and the only part of a merchant’s inventory being promoted is effectively their brand name.
Personally, I think the decision should rest with the merchant since they are footing the bill. All I hope is that the merchants, certainly the big high streets shops with huge brand campaigns, realise that most of their traffic (80% +???) arrives from their own marketing activity. Why would they want to spend money on TV, radio, press, adwords etc… to push sales so that another media business hiding behind a toolbar grabs some of their margin? Basically they would end up paying twice.Therefore I see the smaller merchants with no brand presence nor own marketing initiatives being ok with the concept.