The Vivastay.com Con - Is this the way of things ?

[Lawcom]

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My wife is going to Paris for the weekend and I decided to help her find a hotel..

Found one with Vivastay which was fine .. the price was £64 per night ..

Then before I paid for it decided to use my affilaite link.. went back to the hotel and the price had risen to £68 per night .. so in fact when an affiliate link is used they simply up the price to cover the commission and the customer loses out by going through your link..

What reason would a customer have to do that..

To check I cleared the cookies and tried again, and got the same result.

I this what we have to deal with ? is this normal, one price for them and another for affiliate customers...

Personally I'm furious, I want the best deal for my customers and I understand bottom line but once again it is at the expense of affiliates and their customers
I sometimes wonder what is the point in promoting merchants at all, when they just screw you over every time..

A little P'd off right now, but how endemic is this with in the affiliate marketing industry ?

[hpops]

To take that situation to its logical conclusion. If you had the option of earning more commission by using a different link set, which charged consumers more - would you do it!!!!

Am interested in the communities response here and suprised that there haven't been more comments so far.

[loquax]

I think a TV/Electricals site did this a while back - and the consensus was that it's not right. If a consumer sees this kind of activity it actually tarnishes reputation of affiliate marketing and imo this should be stamped on pretty sharpish. The whole idea should be that affiliate refers sale and shares the reward with merchant from the profit made, not that the consumer pays the difference.

If you had the option of earning more commission by using a different link set, which charged consumers more - would you do it!!!!

No... you only need one person to spot you do this and you're pretty much going to get toasted on some forum somewhere.

Jason

[mattb811]

Really interesting situation Lawcom and not one that I've seen for a while. I remember that there was something similar a few years ago but the merchant in question escapes me now.

I'd be interested to find out what the commission is on the campaign. I would guess it is around 6% which would equate to the mark up they've made. I would say that this is acceptable behaviour as long as they have been upfront about this. I am guessing from your indignation that this is not the case. Where they upfront about it then it is the affiliates choice whether to work with them or not, and I suspect that most wouldn't.

In my experience this is not normal practice, and like Dunc I am quite surprised that more has not been made of this.

[hatmatic]

I have come across this before with a merchant, and in simple terms it was a case of the merchant having a discount off gross price available, and being flexible with affiliate types as to what the mix of customer discount and affiliate commission was.

This was quite acceptable to the affiliates at the time, in fact it was seen as a refreshing approach by some.

For example the total commission on sale the merchant could afford was 10% - there were some affiliates earning 5% and pointing traffic to a 5% off gross page, while there were others who took a lower commission to offer customers a better price. In turn some went for 10% affiliate commission with a higher customer price point.

It worked well, because some affiliates were driven solely by commission, while others understood the balance between commission and conversion, the latter being driven by customer price point.

That doesn't take into account how the customer himself is marketed to.

Also consider a merchant's business where he or she has B2C and B2B customers buying the same products. The B2B customer needs a different margin consideration in order to be able to sell on.

My personal opinion is that the consumer black box of purchase decision remains an unknown entity as it has through the years, irrespective of channel. Some decisions are made purely on price, others by earning loyalty points, others by the belief that they are saving money even though they might not be. For example, many a voucher code creates the perception of money saving, but does it actually do so in reality? Where's the transparency?

Furthermore, there is a growing cross-section of consumers online who will seek out multiple cost saving opportunities e.g. via a cashback and a voucher code site, and where a merchant doesn't manage the customer purchase in these cases, there is a high possibility that the merchant will lose out.

All food for thought, but I believe this is a fairly common occurence where a merchant has different linksets, for legitimate reasons.

[Elaine]

This type of think simply tarnishes the industry - and most affiliates, hopefully, would not join such a merchant and I would hope that the network this programme is with does point out that 'conning' customers is unacceptable.

[mattb811]

Agree with you to an extent Browny (Hatmatic). As I said in my post and as is the case in the examples you allude to, I think this is fine as long as the merchant is transparent about what they are doing and why they're doing it. Appreciate that we don't know the full story of Lawcom's example, but it does seem a little underhand and that is what rankles somewhat.

As is the case in any relationship such as this, it is the affiliates decision on which merchants they work with. In order for affiliates to make the decision of working with one party over another, they need to be in full possession of the facts. One factor that will impact this is the competitiveness of the offer versus other players in the space. If their pricing is being obscured or adjusted according to the channel without anyone having visibility, then this prejudices peoples ability to make a decision.

[hpops]

I think the considerations here are:

1) User perception of Merchant - If the user accesses the site after wiping cookies or from another computer - the confusion and brand damage could potentially be huge (particularly if that confusion leeks into social media circles)
2) User perception of affiliate - As above, except the affiliate site in question might get blamed ("If you go to {affiliate x} they charge you more")
3) Transparency - If the merchant is willing to risk 1) and the affiliate is willing to risk 2) then the wrongdoing is limited to....
4) Discriminatory practice - Is it wrong to punitively impose pricing based on entry channel, is it actually legal? In theory you could extend it to demographic targetting (users who are over 50 get worse prices because they don't price check as much!!) if the data was available. Arguably however, you are discriminating positively when offering a voucher/cash back proposition. Which brings us back to ...
5) User Transparency - I could be wrong, but if this ever got "regulated" either within the industry or by the ASA (not entirely unlikely I'd have thought) I would imagine that the practice could continue with appropriate user notices, (by using this link, you may or may not be charged a greater price) which would of course, render the entire situation commercially unviable.

Of course, merchant marginality is critical in providing an affiliate program at all, but if this is at the expense of users, I'd argue that the damage to the merchant, the affiliate and online marketings future is too great.

[TheHodge]

This happened late last year with Microsofts US cashback site via bing Blog , didn't go down too well then.

[hatmatic]

Completely agree with the principle argument supported by Dunc and Matt.

Consider this, and this was the basis of the emergence of the different linksets, with the merchant I referred to earlier, the merchant encourages an affiliate to take a lower commission, in order that the consumer gets a better price point, and this drives conversion upwards, making epc as attractive as it was (if not moreso - and moreso is the intention) when aff commission was higher, but conversion lower because price point not as competitive (to other merchants in same space).

Would that be deemed acceptable - I think so?

[hpops]

the merchant encourages an affiliate to take a lower commission, in order that the consumer gets a better price point, and this drives conversion upwards, making epc as attractive as it was (if not moreso - and moreso is the intention) when aff commission was higher, but conversion lower because price point not as competitive (to other merchants in same space).

Would that be deemed acceptable - I think so?

I think that the affiliate, network and merchant would find that situation acceptable, but I'm dubious as to whether it is "fair business practice" to the user(s).
If it came to it, and this was in front of an EU administered court, would it be legal to discriminate prices without visibility to the end user?
Can of worms mate, lets go fishing?

[hatmatic]

Indeed. User transparency in pricing is a fascinating topic, and one I am looking at right now. How clear is the window? User pricing is a key consideration at every stage of a business model, and so goes well beyond the realms of affiliate marketing. Would love to discuss further with you on the trip. Seabass off Anglesey is good, or else a spot of fly fishing just West of Bray - your call.

[hpops]

Seabass off Anglesey is good, or else a spot of fly fishing just West of Bray - your call.

In the world of fly-fishing there is a "bait" called the Popham, its extremely colourful - we used to have one on our wall when I was young.
Anyway, this may be off-topic

[Lawcom]

I can't think under any circumstanses that this would be acceptable..

Especially in travel, where the price point is crucial to the customer, it would only take one customer to notice this one merchant doing this and my entire site would be discredited, my site would be blamed not the merchant, in the customers eyes, then with travel blogs / word of mouth it wouldn't be long before the word is " don't go there, they add money on to the price"

There is absolutely no transparency about this, nothing in their affilaite notes on AW to highlight this practice, I would never have known if not for the specific chance of the order I was trying to make the booking.

Also if I got the original ( or shall we say real price ) in a tab, then dropped my cookie, then tried to go with the real price, it would throw up a new page requesting the customer to phone them directly, it wasn't a fulfillment issue, as you could still buy the new, money added on affiliate price.

I think it is totally outrageous to slip in underhandedly that method of price changing.
I t would effectively destroy my own brand site reputation, it is an insult to affiliates and more importantly an insult to our customers and tarnishes the reputation of every travel merchant, I'm now of the mind that I'll have to check every single travel merchant I'm involved with to see if this is not also being done by them and we have all been dupe, lied to and conned.

[KGP]

many companies doing it... until someone notices... anyone remember germanwings?

in the travel sector its more common... and very difficult to "catch" them... especially now that they can serve the same content (and prices) ipwise and not merely on cookie basis... -which makes it more difficult to catch them on the spot-