Changes to Amazon's Affiliate program, and how it affects us

[koland]

Originally Posted by Kali Yuga

I have little sympathy for the 0.1% of affiliates who will be affected by this.

If you want to give away free ebooks, by all means go for it.

If you want to give away 25,000 free ebooks a month on someone else's bandwidth and expect to get paid for it, that's another story.

I'd also guess that if the current affiliate program was working as a loss leader, Amazon wouldn't consider rolling it back. Keep in mind that no matter what you think of Amazon, they are experts at data analysis. They're more than capable of targeting a handful of unproductive sites.

Considering that probably less than 1% make any money at all, that's up to 10% of all their affiliates.

several years ago, they said that they had >2 million affiliates, so .1% is a fair number. Most of their 'affiliates' are completely inactive, but count against that grand total.

[Fbone]

Originally Posted by koland

The biggest issue affiliates have is this: Let's say that I have 5,000 readers and I only recommend books that are not free (or other things - movies, televisions, food, whatever). If I refer over 200 people a day (not a bad rate, for some categories) and those people, on their own, decide to go buy 3 or 4 free kindle books that day - then that affiliate is in danger of exceeding the threshold. Amazon has stated that they will not look at actual referral traffic (despite the wording of the change in the OA that they've published) in making their death sentence decision for that month - if your totals are over, then they back out your payments for the month.

Amazon states only affiliates that “are promoting primarily free Kindle eBooks” will be affected if they also fulfill the 20,000/80 rule. So, in your example above you shouldn't loss your payments because you don't promote free ebooks primarily.

[taustin]

Originally Posted by koland

This sounds like a lot, I'm sure.

But some authors are reporting over 10K free books from a KDP promotion (it takes about that many to affect their rankings).

Through the same affiliate web site? If so, is it a different web site than their own?

Originally Posted by koland

For any blogger with a large following, they hit this easily. For a smaller blogger, it works out to more than 667 books/day (in a 30-day month). So, if they mention a half-dozen free books and more than 100 of their followers buy those books, they'll go over for the month. If they mention 20 books, it takes fewer who click on them all (and some people do, but most are more particular).

Still makes me wonder how many affiliates this is actually going to affect.

Originally Posted by koland

Even for a fairly low-level book blogger, this can happen every month. Unless they then sell >4,000 books (20% of the 20K total), they sacrifice all income for the month (including books directly recommended and sold).

If 80%+ of their referrals are for free books, I can see why Amazon isn't too enthusiastic about continuing the association.

Originally Posted by koland

The biggest issue affiliates have is this: Let's say that I have 5,000 readers and I only recommend books that are not free (or other things - movies, televisions, food, whatever). If I refer over 200 people a day (not a bad rate, for some categories) and those people, on their own, decide to go buy 3 or 4 free kindle books that day - then that affiliate is in danger of exceeding the threshold. Amazon has stated that they will not look at actual referral traffic (despite the wording of the change in the OA that they've published) in making their death sentence decision for that month - if your totals are over, then they back out your payments for the month.

While Amazon is going to get rightly handed their ass over this as it stands right now, I would suggest that perhaps if your readers are going to Amazon and getting 4 (nor 3 or 4, but 4) free books for every book they buy, Amazon's idiotic new policy isn't your biggest problem. Your biggest problem is a business model that depends on the charity of others, who have financial incentive to not be charitable.

[BillPottle]

How will this affect aggregrator sites like viglink?

[koland]

Originally Posted by Fbone

Amazon states only affiliates that “are promoting primarily free Kindle eBooks” will be affected if they also fulfill the 20,000/80 rule. So, in your example above you shouldn't loss your payments because you don't promote free ebooks primarily.

Via email, they have stated that exceeding the limits is HOW they will determine that you promote primarily free books. And that incidental purchase will all count. It won't matter what traffic you send, only what is actually purchased.

At least this isn't an account closing offense (as some are), but it will be a big wakeup call to some. None of us know how many free ebooks are purchased via our links, only the clicks that are registered. Once there, any one of those could buy dozens of free books ... or none.

None of used the free book sales as a model (not the small bloggers anyway; the big freebie sites that are programatically set and sell placement advertising did, obviously) - freebie hunters don't buy much other than the freebies, IME. They do purchase some and no doubt that helps increase reads on sites (so adsense is happier), but they are not a significant source of sales for Amazon or earnings for most affiliates. Amazon is smashing the little guys with a hammer, when the big ones they are likely seeing as the major source of traffic (who probably hit 20K a day) will continue, but find other revenue sources (which won't solve Amazon's problem).

re: author sales. Presumably via one site, as they have been paying for placement at the big ones. $150 in placement = many, many thousands of downloads == higher ranks == avg $600-$700 in actual sales in next few days of same or related titles. I was actually a bit surprised at the numbers, as I had not been following the forum where they were discussing this much lately.

I suspect aggregator sites will have to crack down on those they allow to share their site (viglink, squidoo and others). That or lose what is no doubt tens of thousands in referral fees each month.

[Fbone]

Then there must be something else happening that Amazon isn't sharing with us. They must have known the KDP Select free promotion would drive large numbers to their site and Amazon encourages it with their free bestseller lists and recommendations.

I thought that perhaps Amazon was paying out too much money to affiliates but then they added Ebates to their affiliate program although only 3% on jewelry and gifts.

[gbm]

So, when I go to get a free ebook from Amazon--I should use private browsing since that does not store cookies.

bernie

[Fbone]

I clicked on an affiliate link and 7 Amazon cookies appeared. None expired in 24 hours so I can't determine which one is the affiliate tracking cookie. Or even if one of them was the affiliate if it's named something else.

[rhadin]

Originally Posted by Fbone

Then there must be something else happening that Amazon isn't sharing with us.

I suspect that what is happening is that margins are too thin and investors are starting to lose patience with Bezos' plans.

[Andrew H.]

Originally Posted by rhadin

I suspect that what is happening is that margins are too thin and investors are starting to lose patience with Bezos' plans.

No, if the investors were really upset, this isn't the kind of thing that would make them feel better.

[jalandar]

Originally Posted by rhadin

I suspect that what is happening is that margins are too thin and investors are starting to lose patience with Bezos' plans.

Amazon departments don't traditionally coordinate well.

I truly believe this to be something that originated strictly inside of the Affiliates section, and is not a part of some larger strategy. The reason being the poor way this was implemented, had it been vetted better as part of a coordinated policy change, the very very poor way it is being done would have surely been brought up.

I truly don't believe they realize yet the impact that this will have on how (un)attractive an option KDP Select is for authors now that they have made promotion of free books a death penalty for any affiliate site.

[jalandar]

Originally Posted by issybird

It makes perfect sense to me, but maybe I'm missing something. Amazon wants to stop paying a cut on unrelated sales to entities who don't bring in any money. I don't blame them.

If this was the case, they would have eliminated all avenues of doing that, not just free kindle books. Amazon has always, and continues, to pay people for indirect sales to people whose first click through were not from orders. I know "funny item" blogs that link to things on amazon that are, frankly, silly items, no one would buy, but people click to see the items and laugh, and then anything they buy in the next 24 hours, that site gets the commission on, even though they had nothing to do with the sale that the commission is from. Free mp3s, and prime videos, are also ways to send non-sale traffic to Amazon still and get the same indirect income.

Amazon is not against doing that, clearly, so that is not the issue.

[jalandar]

Originally Posted by taustin

While I agree that this is a pretty stupid response to what may or may not actually be a problem, I gotta wonder: how many web site actually have 20 thousand free books downloaded through them per month? How many affiliates is this actually going to affect?

You have no idea how easy it is to hit that 20,000 number. That is only 666.67 books per day. On the site I run, it's not unusual for a single free book to get over 100 downloads, and I usually post either 9 or 18 per day (depending on if I do one post or two on a given day).

Plus, if that person clicks through to get 1 free book from my site, and in the "Also bought" ads sees another free book, the affiliate will get knocked for 2 free books on that transaction.

I am a very very very small site, and I'll be over that limit, easily.

[jalandar]

Originally Posted by Fbone

Amazon states only affiliates that “are promoting primarily free Kindle eBooks” will be affected if they also fulfill the 20,000/80 rule. So, in your example above you shouldn't loss your payments because you don't promote free ebooks primarily.

Amazon has stated that this interpretation is wrong. That the criteria are how they will determine if you will get paid or not under the rule. They have stated it clearly, and unequivocally.

[jalandar]

Originally Posted by taustin

While Amazon is going to get rightly handed their ass over this as it stands right now, I would suggest that perhaps if your readers are going to Amazon and getting 4 (nor 3 or 4, but 4) free books for every book they buy, Amazon's idiotic new policy isn't your biggest problem. Your biggest problem is a business model that depends on the charity of others, who have financial incentive to not be charitable.

This suggests amazon is losing money on free books. Amazon is the one who CREATED the free ebook market with the KDP Select free promotion days.

Sorry, but this argument that people make to claim this policy change makes sense is really not valid.

I still stand by affiliate division seeing a lot of these sites and deciding independently that this is a "problem" that needed to be solved, and rolled this out without vetting it internally with other divisions before implementing a really awful set of rules.

A lot of the people who are saying "this makes sense" clearly have no grasp on how the affiliate program works, or of its history, or they would know that amazon has actually encouraged affiliates to use the "link to other items/get the cookie set/get paid for other purchases" method of making money.