Disclosures, Disclaimers, and Ethics of Affiliate Marketing

September 25, 2008 by John Dilbeck · 2 Comments
Filed under: Affiliate Marketing 

I’ve been offline for the last week or so and I’m happy to be feeling a little better today.

Normally, in the fall, I suffer from allergies for about six weeks and apparently there is an abundant crop of ragweed this fall here in the mountains of western North Carolina. For the last couple of weeks, I’ve been sneezing, coughing, and wheezing and just haven’t felt like doing anything, even blogging – which I love doing.

I love fall and I’m looking forward to the beautiful leaves in this part of the world. We’re already seeing some nice orange and red leaves on the sumac plants and sassafras trees. They are the harbingers of much more beauty that will soon surround us.

So, I suffer through the allergies until frost kills the ragweed and enjoy the beauty of nature when the leaves turn. Autumn is a season I dread and love at the same time.

Today I was going to try to catch up on my email, but I got sidetracked by an article that CT Moore wrote about Ethics of Affiliate Blogging.

In that article, he talks about the importance of creating a disclosures page that explains to your readers about affiliate marketing and the companies you promote and from which you earn commissions.

Now, on a blog like this, I think it’s pretty obvious that most (but not all) of the links are affiliate links and that I earn a commission when you purchase as a result of following one of my links.

But, what about your blog or website? Do your readers know that you may have more than one reason for linking to a product or site? Do you get paid to promote something?

In some areas, affiliate marketing or any other form of commercial activity is not welcome. In fact, a few short years ago, it was illegal to do any kind of commercial activity on the Internet. So, there is still residual ill will towards people who market online in some parts of the Web.

If your blog is not obviously about affiliate marketing, do you need to create a disclosures page to explain to your readers that you get paid for promoting certain products and services?

That’s an interesting question.

At first, I thought that I didn’t need a disclosures or disclaimers page for this blog, but the more I think about it, I’m starting to think it may be a good idea for at least two reasons:

1. It makes what I’m doing more transparent to you, the reader, so that there is no confusion about the fact that I earn 100% of my income from affiliate marketing.

2. It would make a good page to list all the companies I promote, with an affiliate link to their sites and maybe a short paragraph explaining why I promote their products and services. For two-tier and multi-tier programs, it would also be a good way to link to where you can join their affiliate program.

Disclosures or Disclaimers?

So, assuming that maybe this is a good idea, I’m wondering whether I need to create a disclosures or disclaimers page, or both.

In journalism, a reporter is expected, and sometimes required, to disclose anything that may show links between a story and the writer. For instance, when reporting on a financial story, he or she may be required to disclose the ownership of stock in a company in the story.

Wikipedia says that full disclosure “in media refers to disclosing the interests of the writer which may bear on the subject being written about…”

So, let’s say you have a passion for beekeeping and that’s what you write about. Do you need to disclose to your readers that you may earn income by recommending books about bees and you use affiliate links to promote certain brands of beekeeping equipment and supplies?

If you blog about politics, do your readers have a reasonable expectation that you earn income by promoting some sites or products?

I think it really depends upon your niche and your readers.

If you report news, then I think there should be a separation between editorial and advertising content, as is required by (most) newspapers and magazines.

If you are an authority on a subject and your choice of topics to write about may be influenced by financial interests, then I think disclosure of the facts is a good idea.

What about a disclaimers page?

Wikipedia says, “A disclaimer is generally any statement intended to specify or delimit the scope of rights and obligations that may be exercised and enforced by parties in a legally-recognized relationship. In contrast to other terms for legally operative language, the term ‘disclaimer’ usually implies situations that involve some level of uncertainty, waiver, or risk.”

When applied to affiliate marketing, some disclaimers are probably a good thing. It is a subject I need to explore some more.

Most affiliate programs disclaim earnings potential statements, and some earnings claims are illegal. The FTC requires all claims to be factual, not misleading, and that you be able to back them up with proof.

On my Act On Your Dreams! site, I have a page about Home Business Information and link to some FTC pages about claims and advertising that may be useful to you.

An example of a disclaimer can be seen on Shawn Collins’ Affiliate Marketing Blog. For instance, in his article, Top Affiliate Programs – August 2008, you’ll find the disclaimer: “Disclaimer: While we attempt to include only legitimate programs in this directory, no warranties are made. Please research each company carefully to arrive at your own conclusions. If you experience difficulties with any of the programs listed, contact us, so that we may investigate them.”

This disclaimer is used to reduce risk by disclaiming any warranties that may be expected from listing what he considers the top ten affiliate programs for the month.

He recommends that you perform your own due diligence in investigating the company so that you arrive at your own conclusions instead of relying on his recommendation.

Finally, he offers to investigate programs with which his readers may have experienced problems.

Another example can be found on The Affiliate Marketing Edge Disclaimer Page, which has a lengthy legal document that looks like it may have been professionally prepared by an attorney.

Darren Rowse has a different kind of disclaimer page, ProBlogger Disclaimer, where he talks about what he gets from his blog and what it costs him.

In the current design of his blog’s theme, he links to the disclaimer page from the very bottom right corner of his blog.

Allan Gardyne has a page called Legal Stuff where he makes some common-sense disclaimers and disclosures.

You can find many other examples by searching on Google for terms such as “affiliate marketing disclaimer” and similar phrases.

What to do?

After spending a couple hours thinking about this and looking at other sites, many of which I didn’t mention here, I’ve decided that I need to add a page for this site’s policies and another for disclosures. I’m thinking that I can combine privacy policies and disclaimers on one page, and use the disclosures page to talk about the affiliate programs I promote and why.

What do you think?

Are you actively promoting affiliate programs on your sites, blogs or elsewhere?

Have you considered the importance of creating disclosures, disclaimers, and/or policies pages for your sites?

I’m very interested in your thoughts about these topics.

Disclaimer: I’m not an attorney, don’t want to become one, and have never played one on TV or elsewhere. I’m not offering any legal advice here.

Act on your dream!

JD

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An affiliate program I chose not to join

August 24, 2008 by John Dilbeck · Leave a Comment
Filed under: Affiliate Marketing, Musings, Opinions, TV 

In general, I like to maintain a positive outlook on life and I rarely write posts that contain negative comments about companies and people I don’t know and with whom I have no personal experience.

However, in this case, I’m going to make an exception.

Again, none of this is based on personal experience or knowledge, and I’m sure there are at least two sides to every story.

This morning, I wasn’t feeling very well and I was moving slowly. I watched Meet The Press (still miss Tim!) and then Face The Nation.

I’d printed out the latest Five Pillar Affiliate Report, more on that in a later post, and had left the TV on as background noise while I read.

Then something caught my attention and I started watching the TV show – an informercial about Russ Dalbey’s “Winning in the Cash Flow Business” training materials.

From somewhere, I don’t remember where, I already knew a little bit about cash flow notes and, from my experience long ago, knew that making money by brokering sales of these cash flow notes based on the time value of money isn’t as easy as the show made it out to be. For one thing, a lot of people who have a cash flow note (from lottery winnings, settlements, lawsuit judgements, and so forth) prefer to get a monthly or annual check and don’t care about getting a lump sum, especially when that lump sum is a lot less than the total value of the note.

Have you tried to explain amortization to someone? That’s a lot easier than explaining the time value of money, especially when they have absolutely no interest in talking to you.

I’m not saying that money can’t be made this way, but it surely isn’t as easy as the infomercial leads us to believe.

But, what it did really well was to build excitement about getting lots of money easily. Then, there was the deadline designed to make you reach for your credit card. I don’t remember the actual price of the course, but if you bought it before the show was over (18 more minutes, nine more minutes, one more minute) there were bonuses, free shipping, and a discounted price that was purported to be about a quarter of the regular price.

Now, I understand how this works. The course is obviously a loss-leader and is designed to get you on their list. I suspected that it would be followed up with back-end upgrades and additional offers, so – even though I was tempted – I didn’t reach for the phone or a card.

Later, after reading the 5 Pillar newsletter and taking a nap, I got online and Googled “Winning in the Cash Flow Business.”

I was shocked by what I read on a couple of sites where people had posted their reviews. They were overwhelmingly negative with only a very few positive reviews.

Now, that may not mean as much as it does if you take it only at face value.

If I’m satisfied with a purchase and I learn something that works for me, I’m not going to be looking for a place to review it, unless it is really spectacular.

On the other hand, if I am dissatisfied with something, I’ll express my opinion.

The stories I read about this business were scary. Buy a course for $20 or $40 (it varies) and then someone calls you on the phone and pressures you to spend thousands of dollars. That’s unconscionable, if the stories the reviewers related are true.

There are people out there who must feel as if it is morally wrong to leave a sucker with any money in their pocket or any credit on their credit cards. I’m not saying this company fits that characterization, I don’t know, but there are others who are expressing that sentiment.

(You may want to read what Ken Evoy wrote about Success Stories And Mooch Marketing. Before you reach for your credit card, stop, think, and and perform your due diligence. Learn from the mistakes of others and don’t get suckered in by the glitz, glamor, and promises of easy profits.)

One of the things that caught my attention was that several people related that they had been scammed again (my emphasis).

What does it take to learn?

How hard is it these days to do some research online before handing over your hard earned money or easily spent credit?

Now, I don’t know if most of the stories the people told are true and accurate representations of what they experienced with this company. I don’t know if any of them are true.

But, I don’t have to burn my hand when someone tells me the stove is hot.

When you do a general search for something and the majority of the results on the first page warn of scams, pressure pitches, mistreatment, and not following through with what is promised, why on earth would you send them your money or associate with them in any way.

So, that was my mindset when I found the company’s official website.

As is my habit, I scrolled to the bottom to see if they have an affiliate program, and they do. I clicked on the link and read about it.

It looked great. Super Easy. Fast Payment. Big Commissions. Why Is This The Best Affiliate Program Online?

Yes, it was tempting.

In fact, I’m sure I could make money promoting this.

But I’m not going to.

As I’ve said before, “if it’s not good enough for me, it’s not good enough for you.”

I won’t buy it, so I won’t promote it. It’s just that easy. I sleep easier at night knowing that I wasn’t a part of someone being bilked for thousands of dollars.

Now, I don’t think I’m your parent or guardian. You’re free to make up your own mind and buy the product or join the affiliate program and promote it. It’s totally up to you.

Again, I don’t know if the stories I read are true or not. I don’t know if the company is reliable or not. I don’t plan to do any more checking.

Two aphorisms come to mind in a situation like this…

  • If there’s smoke, there’s fire
  • If it sounds too good to be true, it probably is

Maybe this stove is hot and maybe it’s not, but I’m not going to put my hand on it to find out. There are too many other ways to make money online that I know are legitimate and ethical.

I know that I won’t promote it and that’s the end of my story.

Act on your dream!

JD

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