Nothing like a few dozen lawsuits to get an entire industry’s attention.
One of the few major online coupon browser extensions not to be sued for allegedly stealing online influencers’ sales commissions is proposing a compromise, and encouraging its competitors to adopt its idea before someone gets sued again.
Over the past several months, the owners of the coupon browser extensions Honey, Capital One Shopping, Microsoft Shopping, RetailMeNot, Rakuten and Klarna have collectively been sued more than 50 times by dozens of online influencers. Those influencers recommend products to their followers and earn commissions any time someone clicks on one of their recommendations and makes a purchase. But if a shopper subsequently clicks on a pop-up from one of these companies’ coupon code finders, that company is credited with the sales commission instead.
The industry calls this “last click attribution,” where the very last affiliate a shopper engages with gets credit for encouraging the sale, overriding any affiliate who initially promoted the product. The plaintiffs in the many lawsuits call this practice unfair and deceptive, depriving them of their rightful sales commissions.
So one coupon code finder is pitching what it hopes could become an industry-wide solution.
The People’s Internet Experiment, known by its initials as Pie, was launched last year by a co-founder and several former employees of Honey. Its services, which include a coupon code finder and cash back rewards, are designed in such a way to “help creators and publishers earn more money, not less.”
One of those ways is by prioritizing “stand-down policies” over “last click attribution.”
Many affiliate networks have their own stand-down policies, which act as “a signal that a user has already been referred by an affiliate, and any subsequent clicks should not override the initial referral,” Pie wrote in a recent blog post. But there’s little consistency in how those policies are implemented. Pie has its own stand-down policy, which it says “ensures that your favorite content creators receive their ad revenue.” Although it’s not required or even customary across the industry, Pie says its approach “is to disable the ability to activate Cash Back for one week after a referral is detected, ensuring that the original affiliate receives proper credit.”
So Pie is urging others in the affiliate marketing ecosystem to adopt its solution. Adding a standardized parameter to all affiliate links will signal to coupon browser extensions that “a user has already been referred by a publisher” and prompt the coupon provider to “stand down.”
“This helps maintain the integrity of the referral and ensures the original publisher receives proper credit,” Pie explained.
So Pie is open-sourcing its stand-down rules, allowing and encouraging others to adopt them as industry standards.
Doing so could eliminate the very problem that dozens of affiliate-marketing influencers are currently litigating. The last-click attribution system has long been considered fair, to the extent that the last one to offer a recommendation, a coupon or a cash-back offer before a sale gets credit for prompting that shopper to pull the trigger and make that purchase, even if others had previously helped push the shopper along the path to purchase.
But the lawsuits all claim that the coupon-code providing defendants are exploiting that system, with pop-ups, incentives and sometimes false promises of coupons, to entice shoppers into clicking on their links – ensuring that they claim the sales commission that an influencer recommending a product might otherwise have received.
Pie says a universal stand-down standard would go a long way toward resolving the issue. Further potential solutions include the adoption of a “first-click attribution” standard, it suggests, so no one can claim a commission except for the original recommender. Another solution could be “multi-touch attribution,” in which every affiliate along the way shares partial credit for a sale. One final suggestion is shifting the responsibility for keeping track of it all from publishers to affiliate networks, who would manage a unified data repository to determine who ultimately deserves credit for a sale.
“Together, we can simplify affiliate tracking, reduce complexity, and build a fairer, more efficient environment for everyone,” Pie concluded. And if its solution can save everyone a lot of time and money by not having to litigate the issue – even better.
Image source: Pie / Glenn Carstens-Peters on Unsplash
