Commission theft is far more common than most affiliates think.
Here’s proof:
The short version goes like this…
StomperNET did a big product launch for an $800 a month subscription product. They solicited hundreds of affiliates to help them promote. After the launch, they claimed they had sold 2,000 subscriptions at a price of $800 a month.
That’s $1.6 million in gross revenue each month — or $19.2 million per year.
Then the shenanigans began. In spite of the large sums of money coming in each month, many affiliates were not paid their commissions.
In fact, StomperNET sent an email to affiliates in which they said they were having financial problems. In the same email, they had the audacity to ask their affiliates to promote another launch to help them catch up on unpaid commissions from the first launch!
This all happened during summer and early fall of 2009.
StomperNET Affiliates Start Posting Public Complaints
One affiliate — Paul Simister — promoted StomperNET heavily on his blog. This triggered a number of interesting comments from his readers. For instance:
Hey Paul,
Are you getting payments from stompernet? I’m an affiliate also but haven’t been paid since January because of the way they screwed up the launch of STSE2. I will not promote them until I get my payments.
Sure they have great products – the best… But they just don’t pay their affiliates.
Tom Ham (Stompernet affiliate manager) just keeps giving excuses. It’s a joke for a company of this size to not pay affiliates.
Posted by: Stomper Affiliate | 06/17/2009 at 04:03 PM
Another reader (Robert) left a comment on the same blog post four months later. He actually decided to help out StomperNET by promoting the September 2009 launch in the hopes it would help him get his unpaid commissions. Unfortunately, his strategy didn’t work. He wrote:
Hi Paul,
I’m also an affiliate (and stompernet member) and I am FED UP with chasing Tom Ham and Brad for payments not made since June. It’s a significant amount of money but they don’t reply to emails – or we get excuses.
Brad also said in an email to affiliates a while back (Sept 9) “If you don’t promote for this launch, we’ll still start the payback process for you on September 28th as well.” Well I DID promote the launch and STILL have heard nothing.
Do you have any suggestions? Are you being paid?
Thanks!
Robert
Posted by: Robert | 10/30/2009 at 02:21 AM
Notice the date of Robert’s comment? It’s over a month past the date that StomperNET said they would start paying commissions.
It is now well into 2011 and not much has changed. Unpaid affiliate commissions are still outstanding.
Even worse, on February 22, 2011, StomperNET announced they can’t even pay their own moderators for the work they’ve done. An email sent by Julie Swatek to moderators says (in part):
I know you are anxiously awaiting your checks. I wish I could tell you they were on their way. They are not.
Maybe you are aware, maybe you are not, but StomperNet is in trouble. It’s been in turnaround mode for a year and a half and while it was getting better, all the efforts haven’t been enough.
Every month we lose customers and no new ones have come in. Since we all run our own businesses, we know that is not a good thing
How Commission Theft Happens
How does a company that was supposedly grossing $1.6 million a month fail to pay their affiliates? I’ll venture a few guesses:
- Greed.
- Gross neglect and mismanagement.
- Complete disregard for affiliates.
While StomperNET is certainly one of the more high-profile cases of commission theft in recent years, it still happens much more often than most affiliates would dare to believe.
With that in mind, here are a couple suggestions:
1. If you are an affiliate, it’s important that you only participate in reputable affiliate programs. Never promote for a company that is in “turnaround mode” or the early stages of bankruptcy. Making sales means nothing if you don’t get paid your commissions.
2. If you are an affiliate program owner or manager, it’s important to pay affiliate commissions on time, no matter what. You may also want to differentiate your affiliate program by advertising this fact with the Paid On Time Affiliate Trust Seal.
-Ryan M. Healy
Wow, just heard about it now. I get I lost track of checking for the big affiliate ticket items being promoted nowadays. I’m pretty much sick and tired to get back in the field.
A lot of obsatcles are facing affiliates. They must do thorough research about affiliate program before joining.