PPS Sponsors deducting Chargebacks and Refunds

Obviously this is one way to respond to the recent Visa rule change. Another one is a familiar albeit apocryphal method... SHAVING.

Not that I am for or against it but why would they not?

Mitch

I think that there are a couple that have been doing it already - doesn't Lightspeed have provision for that in their stats?

Cashquest deduct for any dodgy check sign-ups.

I don't see a problem with it though as long as there is some disclosure in their stats so that we know what is happening.

I have a feeling this would become prevalent practice for Per Sign up sponsors. It makes sense. With cross sells producing diminished signups, there has to be housekeeping somewhere.

I know of a few PPS sponsors who have been doing this for some time.

This practice should be industry standard. Minimizes fraud and thereby improves payout stability for honest webmasters.

the way i see it,

end trials all together

charge a nominal monthly say 29.95
pay affiliate $40 per sign up


seems very reasonable since most PPS pay 35 with between 0-4.99 trial

wouldn't this sink conversion rates?

A PPS sponsor i've been using does that. And a partnership program i've been using. I don't mind.

Pimplink,

I'm honestly not at all surprised that sponsors are doing this. In fact, I'm somewhat amazed that some of the larger sponsors have held out this long. With all the third party processors now passing their banks' chargeback fees onto the affiliate programs, programs are going to feel the squeeze. Think about the consequence of the chargeback on a PPS program and you'll see why they're doing it.

They've already paid out $40 to the sponsor, $25 in a chargeback fee, and lost all income associated with that sign-up. If you're a larger program, that's going to really impact your margins, since most of those programs are running on thin margins. I honestly wouldn't be surprised if programs started holding back a 10% reserve in the future and started passing on their chargeback fees to affiliates as well.

That's why we keep saying that chargebacks are an industry-wide problem. They don't just affect processors and paysites -- they hurt everybody. This week AdultRep started pursuing collection activity against customers chargeback at our clients' websites. We were previously doing this only for our merchant account clients, but now we're doing it for all clients, whether they use a merchant account or IPSP.

If Visa and MasterCard are not going to provide us with a secure and safe way to accept payments from their cardholders, it's time the industry start getting aggressive with customers who chargeback. So, at least at our clients' websites, if you chargeback, you're going to get hassled by a collection agency and we're going to add a charge off tradeline to your credit report.

Victoria

I would love to do this, and even think it should be done. CB's and Credits play a major role in the business model when you cut other revenue sources left and right.

But I am not sure webmasters are ready for it.

I wouldnt mind. Wouldnt that pretty much stop webmaster fraud and all the costs of tracking it? Just pay a higher rate per signup, but only pay for productive signups.

in the beginning cause the free surfers taking advantage of trials realize there aren't any

It's not something that would have a tremendous effect on webmaster fraud... most cheaters come into a program, do their damage and move on to the next one at the first sign they are caught. Since cb's do not hit until a couple of months after the sale the cheaters could get thru anywhere from 2 to 8 payouts with a sponsor (depending on frequency of payouts) before the sponsor even saw the first chargeback.

webmasters want trials, because they convert better.

If 90% of paysites stop offering trials, webmasters will send their traffic to the program that still offer them.

It's similar to the problem of reducing free porn.

some of my best money making programs dont offer trials

if all third billing companies stop allowing trials then there wouldn't be that problem.

sure there will be another small 3rd party biller will come up and allow it, just like new 3rd parties stating you don't have to pay the $750 fee

But look what happened in the long run,

It'll be tough for the first few months, but things will settle out as new surfers looking at porn for first time never knew trials had existed,, then the old porn surfers realize that shit ain't free and cheap like it was.

We all seen it happen in main stream sites,, remember you could just about get everything free online in the beginning, until they realized that adverts wasn't getting any conversions and dot coms going bust. Now everything costs money.


Hell CECASH pays $50 for active members

so apparently this model could work, leave out trials and increase webmaster payouts,


Perfect Solution,