Thursday, February 14, 2013

Affiliate Advertising

[ed. Posted not because I have anything against Ms. Popova's excellent site, but because I find the details about affiliate advertising interesting.]

Maria Popova is a Forbes 30 under 30 honoree, regular author for The Atlantic, and was named to the Fast Company 100 Most Creative in Business list. I let her know I was a regular reader of her site when I sent her an email a few months ago after she wrote an article about the dangers of advertising in journalism. She detailed a scenario in which a Pulitzer Prize winning journalist was offered money from Xerox to write an article. I sent her a message to ask for clarity in what she meant, given that I was aware of her practice of putting affiliate advertising links in her articles while at the same time asking users at the end of each article to donate to her site by telling them that she runs an ad-free site that is subsidized by user contributions (screenshot). It is often controversial for a site to make money off of affiliate ads without notifying users in any terms of use (i.e. Pinterest), or to write reviews on products without notifying users they are making money when the reader clicks and purchases those products (the FTC enforces laws for certain types of blogs), but Popova has been going a bit further - while keeping the ads undisclosed, she also writes at the end of each article and in each email newsletter that the site is ad-free and needs user donations to support it.

The Brain Pickings “Support” page reads: “Keeping it all ad-free…means it’s subsidized by the generous support of readers like you.” In a revealing email exchange outlined below, Popova told me that 25% of her book recommendations come from the data that she receives from Amazon after her readers click the ads in her articles and go on to make purchases (she sees, and makes commissions off of, the other items they place in their shopping cart, including books that she didn’t link to). I found this to be interesting given that she made waves in the journalism and blogging community by publishing the “Curator’s Code” last year which urged website owners to be more upfront in attributing where they found the content they post. It was also ironic given that she regularly writes diatribes in publications such as The Atlantic and NY Times railing against the “filter bubble” which is the common practice of websites using algorithms to recommend to users things that similar users have also read or purchased.

An interview in The Guardian last month drew me to revisit our weeklong email exchange from last Spring. I had inquired about whether she would notify users of her ad practices, and I was surprised to receive a defensive response coupled with a condescending sign off that read, “I wish you the very best as you continue to explore and navigate the world of media and morality.” Not being the open letter type, I wrote back with a few reasons why she may be misleading users, and after we had exchanged 7 or 8 more emails, she agreed to change her pitch to “banner-free” instead of “ad-free.” When she changed it back to “ad-free” within 6 weeks, I was disappointed, but still not the open letter type. When she ignored my next three attempts over the summer to ask her why she still claimed to be ad-free, I figured she must have just really need the donations to keep the site going.

But then I read The Guardian article last month which quoted Brain Pickings user numbers (millions per month) that point to potentially millions of dollars in deception on the table, then I did a google search and found out that a for-profit LLC was formed in New York called “Brain Pickings LLC” (with an address matching the one on Popova’s contact page), just one month after my email inquiry to her (odd timing for a site in its 7th year at the time), and then I saw more articles by Popova condemning media, journalism, writers, and the filter bubble….and then I realized it was time for an open-letter and thought this was a worthwhile place to start a much needed discussion about affiliate advertising, Pulitzer Prize winners, the journalism and blogging industries, how E.B. White started all of this and how Richard Feynman can end it.

Describing how affiliate ads affect writers is necessary given that the reason Popova told me she uses the “ad-free” pitch is that she claims her affiliate advertising links are not ads. Popova uses Amazon’s Affiliate links program - which means if I click a book or product link from her site and buy that book, and another book, and a movie, diapers, a shirt, and anything else - she receives up to 10% of my entire shopping cart’s value from that trip to Amazon…and she also gets to see what I purchased. Given the non-Silicon Valley nature of her site, I was willing to give her the benefit of the doubt that maybe she didn’t realize that these are a form of advertising (even though the first feature in bold on the Amazon Affiliates page is “Advertising,” and in every description of the service, Amazon calls the revenue made by partner websites “advertising fees.”).

Maria informed me she doesn’t define the links in her articles as ads because they are all “books that I would feature anyhow” and that her “different intention” means that she is not seeking to sell the books. I pointed out that in Google’s quest to organize the world’s information, there are tens of millions of times per day where the top Google result is also the top Ad that they display, but in these cases they don’t say “this is the one we were going to show you anyway” and hide the fact that it is an ad. Advertising is a business process defined by the way money changes hands - intent does not play a part in the definition. Roger Federer probably already likes Rolexes, but as soon as they pay him millions of dollars, he is considered to be advertising their product. Aside from the fact that businesses don’t get to create their own definition of advertising, Maria’s claim that they were all books she would feature anyhow was contradictory to the statement she wrote in the same email thread, which proves that her advertisements do in fact change what books she offers to users:

“a major reason I use Amazon is…data they give me - it tells me what other books Brain Pickings readers are buying on Amazon…I’d say I’ve found at least a quarter of the books I myself have purchased and read over the past few years through Brain Pickings readers that way.”

Pulitzer Prize winning journalist Harrison Salisbury was the subject of an E.B. White letter featured by Maria last Spring that spawned our correspondence. In 1975, Xerox offered Salisbury $55,000 to write an article in Esquire magazine. White expresses his concern about the erosion of press if writers start accepting money from advertisers this way. In her commentary, Popova noted that she “has been publishing an ad-free curiosity catalog supported by reader donations for the past seven years.” Reading the article I could only think what reader response would be if the article concluded with “Disclaimer: I make money each time you click a link in my articles and buy a book.”

There are important differences that make affiliate ads more subversive than the Xerox-Esquire scenario. The Affiliate form of advertising invites more detriment to quality writing because it actually requires an author to interrupt the reader with a link and it incentivizes authors to change their tone such that they convince the reader to go all the way through with the purchase (which is necessary for them to receive their kickback). At least in the golden days of tainted journalism the author was paid upfront, and the ad was on the opposite page, not in the article itself, so they were still incentivized to write a quality article about anything they wanted - health, art, sports - that people thought was interesting enough to read, while hoping that wandering eyes would bring eyeballs to the Xerox Ad on the facing page. I’m not saying this offer was a good thing, simply noting that if Brain Pickings is building a brand based on anti-ad sentiments, it might be fair to explain how the revenue generating practices of the site work. The Guardian article described the site as an “antidote to Google” - ironic given the identical business models of Brain Pickings and Google, both of which make money as users click links in the normal course of using each site…the difference being that Google makes it known which links are ads.

by Tom Bleymaier, On Advertising | Read more: