PPC Closed Groups

[KevinEdwards]

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There is an elitist scenario developing in the marketplace especially in the ppc click arena which is becoming unhealthy & getting noticed.

Hi,

As I previously mentioned, I try to offer different affiliates the chance to brand name bid where possible on campaigns I manage(d), but I'm interested in what other affiliates think about the issue.

I'm asking in response to, lets say, a move by several affiliates in collaboration with each other offering to dominate that space across the board where applicable.

I presume QGJ would be opposed to it and personally I don't see it as promoting healthy competition in the PPC space, but what do others think?

Thanks,

[loquax]

Wouldn't such a move be deemed restrictive practice though (i.e. a group of companies working together to protect their own interests so as to prevent fair competition and new business getting involved)?

Not 100% sure, but if you're going to allow a small group to monopolise a certain area of affiliate marketing then you as a network are opening up yourself a nice can of worms.

Also I think considering a number of networks/merchants would like to have PPC affiliates, if new affiliates or even those with less £££ to play with find they can't get involved in PPC because it's monopolised then it's going to have a knock on effect.

If these PPC guys are good enough they should accept that it's a competitive business world and a free market - and networks/merchants should discourage such cartelism.

Jason

[KevinEdwards]

I also think (even if we accept the idea in principle) there is no guarantee a closed group of, say, three affiliates can ever be experts across the board.

I find it hard to believe that there aren't other PPC specialists out there that can't perform better in certain sectors.

And who is to say there aren't really good PPC affiliates out there who are prevented from getting anywhere near brand name bidding on huge swathes of programs?

Managed groups in the PPC space should be an organic thing, reassessed and occasionally rotated to give others a bite at the cherry. I'm happy to take a look at my programs if others express an interest and I can see potential gaps. It's always going to be a bit like walking a tightrope (you can never please all the people all the time) but I can't see a much fairer way of operating.

Anyway potential moves to a cartel being established is a worrying trend I think and I can see it causing a big rift if it gets off the ground.

[D-Mac]

Kevin, maybe you should also ask this question to the merchants themselves?

You may also consider asking the merchants if they fully understand the implications of brand name bidding too.

With regard to the question you asked, I agree with Jason.

[loquax]

potential moves to a cartel being established is a worrying trend

But it already exists... for example a new program launches yesterday with the following ..

Please do not bid on our name or any variation, we are working with a select group of affiliates for this.

Jason

[KevinEdwards]

It does exist, but it has to exist in order to effectively manage the PPC space.

I've managed groups like this before and yes it is to the exclusion of other affiliates, but the fairest way to manage it from then on is monitor it and hopefully bring new affiliates in, as well as trying to bring new affiliates in when new campaigns launch.

What I'm talking about is a group of affiliates, the same affiliates working essentially as one, to the exclusion of everyone else. It wouldn't be the case of an advertiser or network working with an organic group of different affiliates, but having to work with this one fixed 'body'.

[Shane]

Regarding an organised "cartel" I'd be suprised if you could get a room full of PPC specialists that would commit to work together without one squeeling about x or z campaign being "theirs" and work for the good of a group rather than just personally.

It seems some people in PPC now who are prepared to throw away their integrity and engage in underhanded tactics and stamp on whoever gets in their way in their quest for PPC dominance, so if it's this type of PPC affiliate who ends up being part of a "cartel" then it's doomed before it gets going and the group will surely implode at some stage.

there are literally only a handful of guys left I'd consider such a venture with.

A certain number of PPC affiliates won't behave and will flout any restrictions placed upon them, this is very annoying and I think in some cases the PPC activity does need to be restricted in some way to those affiliates that do behave to safeguard the continuance of a merchant's program.

Some networks are too lax in repremanding offending PPC affiliates, time and time again they warn them and don't cut commissions, so they continue to PPC in contravention to the guidelines, ie no brand name, not direct, not using merchant's url, not bid more than the merchant etc., in some cases the offending affiliates manage to break every one of the rules on the same campaign ! and continue to do so.

From a merchant point of view I'd be somewhat annoyed if my "sales team" were ignoring strict instructions on what to do and not to do and if the network couldn't bring the PPC affiliates into line then I'd be really annoyed.

Closed groups are great if you are in them, bad if you are not, but they do have their uses on campaigns where some PPC affiliates just won't behave.

I can think of a few instances where one or two affiliates are bidding on brand names where they shouldn't be and also bidding above a merchant after we've all been emailed and told not to do it enough times already..

Stricter network management (they are getting paid after all to control the affiliates on the program) is definitely needed to clean out rogue elements from the ppc environment who think they can bid how and do what they want regardless of the merchant's restrictions and put a programs continuance for all in jeopardy whilst doing so.

[taramoar]

Completely agree with Shane.

Have to also keep in mind that when a program has allowed only certain affiliates to bid on brand terms etc there is no reason why one couldn't approach the network/merchant/agency and ask to be part of the group. It shouldn't be regarded as a 'closed' group. I'm sure if anyone were to show they can fill a gap or even add to what's there then they could join in.

Tara

[KevinEdwards]

Shane,

I agree with you, networks have been a little slow to react but we've been working on putting into place legal agreements to ensure everyone is covered and also working on practical measures such as affiliate rotation within the space so no one feels the need to try and 'depose' a fellow affiliate.

For me, the issue is as much about transparency and visibility as anything else. Affiliates intent on flouting rules/CPC caps etc. will damage themselves, the network and the industry as a whole.

If an advertiser has complete visibility on how the ads work as a complementary channel to their own 'official' PPC ad then it can clearly work.

I positively encourage an advertiser to get involved, working with affiliates to design landing pages, help with ad copy etc. Fostering that sort of relationship can only be a positive. It also helps both sides to understand how they can maximise their effectiveness in the space.

My main concern would be a cartel strong-arming themselves upon networks and advertisers alike pushing independent affiliates out of the space.

[Brendon]

"Closed groups" already exist self organised by the affs. They know who they are, and they share the risks and rewards - bidding wars help no-one but the PPC platforms. Obviously, they can be kept out of brand terms by the platforms, but there's plenty of generic terms out there

>> cartel strong-arming themselves upon networks and advertisers alike pushing independent affiliates out of the space.

Already happens.... but what are you gonna do about it? Its very hard to prove they do it, and you improve your detection apparatus, they will improve their methodology.

[Qui Gon Jinn]

Obviosusly I have touched a nerve...

Another problem is some merchants place ppc restrictions as a knee jerk reaction not thinking about the leakage from natural search or other ads coming into play on broad match terms if a visitor searches by a phrase containing that brand. i.e. XYZ sells car insurance. Apart from the term XYZ, "XYZ Car Insurance" is the second most popular searched phrase.

The advertiser is bidding on "Car Insurance" on broad match but can appear, resulting in more leakage even though user was initially looking for brand. Also often enough for phrases the merchant doesn't appear top of natural search. Even if they do some merchants have a misguided opinion thinking they will get 100% transition of traffic assuming they have the divine right to appear number one for any phrase containing the brand name. When they don't own the search engine.

There are a lot of questions that should be presented to a merchant if they impose a restriction, more often than not they don't understand the arena & really unsure if a network adequately presents these properly. Some are open to suggestions some are not. This is where the merchant should speak with affiliates rather than rely on the network.

There are lots of examples & scenarios whcich we would share with a merchant if speaking with them directly and don't think this is communicated fully to the merchant. But the number of times we have been refused by DGM for a contact number of a merchant. It's not didfficult to get, we just have to go the long way around and it doesn't make the network look favourable when they are informed that the network refused. By merchants & affiliates being able to comminicate directly with each other can only assist in understanding each other & acheive common goals. Refusing contact details is simply going back to the dark ages or a paranoia on the networks behalf.

Often too, affiliates are clamped down upon first ... being the easy target ... with little advanced notice in addition ... BE POLITE NOT ULTIMATUMS ... However all too often non affiliate companies can still happily bid on brand names which affiliates are restircted upon. I am not talking necessarily about merchants bidding on competitor brands, but if they sell another merchants goods.

Merchants should also register their mark with the respective ppc search engines. If they wish to be strict / resolute on brand name bidding ... they should do it first.

Every network should have a single interface so affiliates can see which merchants have restrictions without having to navigate several hundred merchant pages on a daily basis which is logistically impossible & often information not contained within.

Even those networks with a specific landing page, the rules are NOT CLEAR enough at all. There are a number of factors where an affiliate - can do this but not that. Is a landing page required? Are only certain keywords restricted? Is there a Max bid value? Does ad copy or landing page need to be approved first? Is it only certain PPC Search engines which are restricted or Is it Invitation only etc etc.

What merchants must also consider with a licenced circle of affiliates are those not included who are very active in the ppc market. Remember they can also appear on broadmatch on phrases typed in by the user for containing that brand name but are only bidding on the non branded elements with plenty of negative keywords. Well within their rights.

Lets take an electrical merchant or mobile phone merchant with only three or four affs permitted to do ppc. Another proficient affiliate can simply bid on all their core products & send to to their competitors & compete directly.

Also, an affiliate should not have to dependent on the network to be included on any invite only basis. The affiliate should be able to contact the merchant directly to discuss terms & present their position & use the networks links. It shouldn't be the network who makes the recommendations, this is where it all falls down. Instead the merchant opens dialogue directly with any affiliate who is interested and makes an informed decsion from there without any interference from the network.

[KevinEdwards]

I don't have any issue with affiliates contacting merchants directly.

Affiliates I work closely with will tell you as much. Screwfix for example regularly speak to certain affiliates. Equator who I work closely with for Haven Holidays and Budget also contact their affiliates directly. Comet recently hosted an open forum and a selection of affiliates were invited to that to speak directly to representatives from the company.

One thing to bear in mind is that if we're dealing with an agency we are very rarely allowed to speak to a client directly anyway - this seems to be guarded more closely than anything else, thus it can be difficult for us to extol the virtures of PPC, if an agency doesn't 'get it'. Perhaps I'm lucky - the agency employees I deal with are (largely) singing from the same hymn sheet as me.

Regardless about whether an agency understands the benefits or not I would like to think I'm well versed and convinced of the benefits of PPC brand name bidding enough to talk about it with conviction to advertisers and agencies alike.

I accept your point about clarity on PPC bidding across the board - a central resource is useful. dgm's is here - not entirely up to date I know and it should be, so we'll work on providing more accurate information.

Advertiser PPC T&Cs

[drivetowin]

As someone who is not in the PPC arena I can see both sides of the argument on this one.

I think having small managed groups of affiliates doing PPC is bound to happen (albeit that it does appear unfair to affiliates who are not in that group) - that said I guess its no different to the email newsletter marketplace (where I am active) and again I'm aware of some campaigns which are either a) exclusive to me or b) exclusive to me and maybe only four or five other affiliates - but I'm also aware that there are newsletter campaigns into which I'm not invited - but that's cool by me too - I dont want to hog the pie - just make sure I get my fair share - and I guess the same is probably true for many ppc affiliates (though there do appear to be some ppc affiliates who get over hungry - and networks / Google should really improve their out of hours monitoring if they are serious about managing their PPC affiliates (witness the PPC ads which appear at weekends and arent seen at all during the week )

However I think the establishment of a 'cartel' should be actively discouraged by the networks as it really is in no ones interest at the end of the day.

In an ideal world, affiliates would self regulate, obey the rules set by merchants and everyone would be happy, but sadly we are not yet in utopia and so network management of PPC affiliates is necessary and therefore select groups are bound to develop - at the end of the day we all like working with the people we like working with!! - I hope that makes sense - I'm still wearing off the effects of yesterdays sedatives!!

I think too though that there is often a failure on the part of the networks, both for PPC, email newsletters and SEO to convey merchant restrictions concisely and accurately


A thought which does come to mind though - if networks chopped the account of an affiliate who didnt keep to PPC rules - ie not just for that merchant but their whole affiliate account I bet other PPC affiliates tempted to bend the rules would rapidly fall back into line.

[Fraser]

It's a difficult issue to work out - I can see from the merchant point of view that allowing 3 or 4 affiliates who you can trust to do it properly could be helpful. Although I don't think a merchant should just let the network pick out who they should work with.

But from the affiliate point of view it's probably just the same people getting handed easy money by doing brand name bidding when everyone else is restricted.

[KevinEdwards]

Fraser,

Fair point about affiliates creaming off sales purely from brand names, but I think it's important to get affiliates on board who then use some of that 'easy' money to invest in generic - thus adding some extra value to the advertiser.