Amazon Lawyers Go After Fraudulent Affiliate Marketers
The company filed a similar lawsuit last year against an Illinois-based affiliate marketing company, seeking a ban on its use of Amazon trademarks. The affiliate marketing scheme is similar to a recent phishing scam that caught the attention of Michigan police by using alleged Amazon trademarks to trick recipients into sharing personal information. Amazon said it had suspended the campaign and reached a settlement with Michigan Attorney General Bill Schuette to end the use of the company’s trademarks.
Amazon said customers should report unwanted emails and text messages here, and the company has helpful guidance here on how to decrypt suspicious emails, phone calls and websites.
The CAN – SPAM Act of 2003 makes it illegal to send junk e-mail on behalf of a company that companies should know as spam and to take appropriate measures to monitor its subsidiaries.
According to Wernikoff, many of the defendants in the FTC cases are in affiliate marketing situations. EarthLink, which announced four lawsuits against the alleged spammers on Wednesday, has filed its own lawsuit against a company that hired the spammers to market its products. The FTC has launched a number of other lawsuits against companies that have abused affiliate marketing programs.
The Federal Trade Commission has sought to hold Amazon and other companies accountable for their affiliate marketing practices as well as the companies themselves.
A subsidiary of Cyberheat used sexually explicit emails that did not comply with the FTC’s warnings. The FTC tried to make cyber hackers strictly liable for the affiliate’s actions, but one of its affiliates used a “sexually explicit” email that did not comply with the FTC’s warnings and identification requirements. While this case has not resulted in Cyber Heaters being strictly held responsible for its affiliate actions, the FTC and state authorities have further increased the requirements for monitoring affiliates, and today merchants can pretend to be held liable in their affiliate actions. If an affiliate does something illegal, traders should be prepared for litigation with the FTC.
Hogan recently fell out with eBay, and the company has sued him, accusing him of fraud. Affiliate marketers place ads with links to eBay and collect the revenue the online auction house generates through them.
Unscrupulous affiliates use spam, false advertising and forced clicks to set up tracking cookies on users “computers and direct traffic to their sponsors. This is done by equipping unsuspecting users with tracking devices, according to the lawsuit.
In a sense, affiliate marketing is essentially a form of advertising in which the sales act is outsourced. Amazon spread this practice by introducing affiliate programs, in which websites and bloggers link to Amazon sites, so that those who review and discuss products receive advertising revenue when they buy.
According to Business Insider, affiliate marketing accounts for 15% of all e-commerce revenue. Affiliates are not employed by the advertisers of the products and services they advertise, but by the advertisers themselves. The remuneration model that applies to connected marketing is often referred to as “performance marketing,” as opposed to the way sales staff are typically remunerated. It is a different model from the one used for people in an advertiser’s internal sales department.
The main difference between the two is that affiliate marketers offer the ability to direct prospects to an advertiser’s website. Affiliates are an expanded sales force for the company, and the term “connected marketing,” as it is often used to explain affiliate marketing, is not entirely accurate.
These scams give affiliate marketing a bad name and make it difficult for everyone, but affiliate programs have some kind of validation for purchases to make sure they don’t pay for fraudulent clicks or purchases that lead to chargebacks or are made with stolen cards.
Sometimes the engines used to validate sales are a bit too strict and catch valid traffic, but sometimes they are not.
Hundreds more examples of affiliate fraud have been documented over the past decade, and if you do it tens of millions of times, you’ll get a share of eBay’s revenue for not helping to create the sales. If eBay becomes aware of these scams and stops you for a year, you pay millions of dollars.
Affiliate marketing is about as old as e-commerce, but the industry got a kick-start after Amazon.com launched an affiliate program in 1996. Last year, the newspaper paid $30 million for two review sites, Wirecutter and Sweethome, which have built a bustling business away from affiliate links. Within the first month, Derek told me, he typically received a commission of $1,000 for each mattress sold, a commission that has become standard in affiliate marketing.