I have not been following the CPA space too closely lately, but I guess lots of major CPA affiliate networks have gone under including COPEAC and Adteractive and Neverblue’s parent company reportedly went bankrupt too.
And now, in the latest news, it sounds like Epic Direct, formerly known as Azoogle is going down too. I did advertising for Azoogle for a couple years and they used to be one of the largest networks. COPEAC was pretty big too.
So what is shaking up the industry and causing all these problems? I think it’s somewhat of a domino effect that can happen when you have chains of advertisers and networks all interconnected and pushing each other’s offers. Then mix in a few big FTC lawsuits and fines, all the rebill problems, tightening up of merchant account terms and things start to fall apart. One starts hurting, can’t pay the other and dominoes start to fall.
I’ve always had a problem with the CPA industry, because so much of it is spammy, scammy, get rich quick offers, incentive offers and freebies. And I’ve always had a serious problem with the ethics of those rebill offers!
HOWEVER in spite of not really liking the CPA side of our industry, I feel bad for all the CPA affiliates that are getting stiffed as these companies go under.
Pace Latin shares some thoughts about what is causing all these networks to go down. At the link below, he goes on to explain 4 of the major issues behind this industry-wide problem.
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Affiliates should be very concerned. Many networks are paying out before they are paid, have little cash reserves and worse, do not have a long-term business plan on how to make money besides brokering offers.
This is obviously part of the CPA game, but it’s a very dangerous game for those companies that have a few core advertisers and affiliates that support them.
What are the major issues plaguing the industry that will cause problems…