The five affects of 180 Solutions' activities

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From Benjamin Edelman

The five groups affected by 180 "cookie-stuffing"

180's cookie-stuffing affects five distinct groups, in the following ways:

Users suffer from 180solutions' activities.

Users' affiliate commissions do not reach the affiliate (if any) that 180 users selected intentionally (e.g. to support a particular web site) or implicitly (e.g. by using that site and clicking through its links to recommended merchants). This redirection harms users -- especially when they are thwarted in their explicit goal of directing commissions to particular affiliates. To the extent that 180's activities take money from merchants, and merchants ultimately increase their prices to cover their costs, users -- even users without 180 software -- indirectly fund 180.

Legitimate affiliates suffer from 180solutions' activities.

Legitimate affiliates lose commissions on purchases by users with 180 software installed. These losses are particularly serious to the extent that affiliates rely on these commissions -- e.g. to support their web hosting and development costs, or to make web publishing a job rather than a hobby.


Merchants suffer from 180solutions' activities.

Merchants suffer in at least two distinct ways from 180's activities. 180 cookie-stuffing causes merchants to pay commissions to 180 even when users reached a merchant's site directly or through some source other than an affiliate link. If a user typed in a domain name after (for example) seeing an ad on TV or in print, the merchant has already "paid for" acquisition of that user via the offline advertising. If a user arrived at a site via a sponsored link from a search engine, the merchant incurs a cost for that user's visit via payment to the search engine.

Nonetheless, 180's affiliate cookie-stuffing causes the merchant to pay again -- to pay twice for a single user and a single purchase. 180 cookie-stuffing therefore increases the cost of acquiring new customers, reducing the returns to merchants' advertising both online and offline.

180 cookie-stuffing causes merchants to pay commissions to 180 even when commission is properly payable to another affiliate. By reducing the earnings of other affiliates, 180's activities cause merchants to lose affiliates or to recruit worse or fewer affiliates. This in turn reduces the effectiveness of the merchant's overall affiliate program.


180solutions benefits from 180solutions' activities.

Cookie-stuffing earns income for 180solutions. Indeed, in November 2003, MSNBC reported that during September 2003, 180 had earned more than $100,000 in commissions from more than $4 million of purchases at Dell. Now that 180 reports an installed base roughly twice as large, 180's earnings could be twice as large -- from Dell alone. At Dell's maximum commission rate of 4%, 180 makes a $40 commission on a $1000 PC -- meaning 180 stands to make a large amount of money if only a few thousand 180 users buy new computers each year. Furthermore, since 180 participates in several hundred affiliate programs, as described above, 180's actual affiliate earnings could be two orders of magnitude larger.


Affiliate networks benefit, at least initially, from 180solutions' activities.

Affiliate merchants ordinarily pay their affiliate networks a percentage of all affiliate revenues passing through the network. So, the more money passes through the network -- including to 180solutions -- the more money affiliate networks make. Details below: Possible responses by affiliate networks, Delays in response by affiliate networks..

[Shane]

180 cookie-stuffing causes merchants to pay commissions to 180 even when users reached a merchant's site directly or through some source other than an affiliate link

So really any merchant reading that should be onto their network (if the network still take the spyware traffic) and beating them to stop working with spyware companies.

Any merchants who use the forum should really be thinking WTF am I doing dealing with these spyware infested networks who really do not give a feck about my business at all and are in fact actually costing me money as I'm paying for traffic that I have already probably paid for via press, TV, Radio, ppc, long term branding campaigns etc.