
Refer.ly (YC S12) Lets Regular Folks Earn Affiliate Revenue - dmor
http://techcrunch.com/2012/05/14/refer-ly-lets-regular-folks-earn-affiliate-revenue-for-recommending-products-they-love/
======
jbenz
I love it. It sounds like a few people here have been thinking about a similar
idea, and you can count me in as well. The truth is, my company would be happy
to pay out 10% of any order if it resulted from a genuine recommendation. Of
course anyone experienced with the affiliate world can figure out a way to
capture that money, but it's not really available to your everyday Facebook
user. Maybe Refer.ly will fix that. Using Viglink is smart.

Unfortunately, the ecommerce company for which I work has had to completely
abandoned affiliate marketing. Almost all of our affiliate fees were going to
scammers who were using Google Adwords and bidding on our brand terms. Of
course that was against our policy, but we had no way of stopping them out of
the gate. They would even copy our exact ad so that when we searched our own
name, it would appear at a glance that it was in fact our ad showing up (same
display URL and everything). Eventually we just had to shut the whole thing
down. I hope Refer.ly can figure out a way to avoid these scammers. I imagine
it will be difficult.

With this business model, I wonder if it's possible to act as an aggregator
for the Amazon affiliate system? Amazon pays out a higher percentage based on
how much volume you bring in. If Refer.ly acted as a single affiliate with
Amazon, but they in turn paid out affiliates to thousands of different
Refer.ly users, then each user would then be getting the highest possible
affiliate percentage from Amazon, right? Because together they would qualify
for the volume bonus. I haven't looked into it, but I'm guessing Amazon must
have some rule against this.

~~~
dangrossman
> I haven't looked into it, but I'm guessing Amazon must have some rule
> against this.

That seems to be the case, so they'd have to make a special arrangement with
Amazon to do so.

> 9\. ... nor will you create links formatted with your Associate’s tag for,
> or display such links on, a site that is not your site.

[https://affiliate-
program.amazon.com/gp/associates/help/oper...](https://affiliate-
program.amazon.com/gp/associates/help/operating/participation?ie=UTF8&pf_rd_t=501&ref_=amb_link_353005802_7&pf_rd_m=ATVPDKIKX0DER&pf_rd_p=&pf_rd_s=assoc-
center-1&pf_rd_r=&pf_rd_i=assoc_operating)

~~~
robryan
I wouldn't start with amazon associates, there are plenty of smaller affiliate
networks who would love to help out and promote this service.

Amazon associates presents a big tracking challenge because their system seems
to be designed to give up as little data as possible. It is by far the hardest
network I have come across to login as a user and retrieve transaction data in
an automated way.

------
aresant
I've spent a lot of time working with affiliate marketers over the past decade
and I wonder how Refer.ly is going to handle compliance with the new FTC rules
around compensation disclosure.

Effectively if you're promoting a product in exchange for compensation, that
relationship must be disclosed at the genesis of the click and according to
the FTC no compensation is too small to be in violation w/out disclosure.

<http://www.ftc.gov/opa/2009/10/endortest.shtm>

~~~
debacle
Forget refer.ly, how is Amazon going to cope with this in general?

~~~
its_so_on
I might not be popular here for saying so, but I have to get this off my
chest. I think it is a pretty great move by the FTC to make it outright fraud
to shill, and I'll tell you why I think so. Please indulge me a little.

The reason is that information doesn't generate itself. If you Google
_BlackHole5000 coffee extruder review_ , the BlackHole5000 coffee extruder
being this great industrial high-pressure coffee maker, and you don't find a
single review, that means in a way there is this 'commons' that is empty now.
If there is no Wikipedia article on it (maybe there shouldn't be) there is
also an empty 'commons' there. Now compare this with a Wikipedia article being
there and being informative: (say the BlackHole5000 is extremely notable, as
destiny would have in 20 years) if someone were to completely blank that page
out or vandalize it beyond usability, then until this issue is rectified it's
pretty clear that they have taken someone from a 'common good.'

Now my argument is that if people take the time to post their review of the
BlackHole5000, for me to find, that is also kind of a public good. (After all,
they're free to browse if you can find them, etc.) If Google and _every_
search engine were to be completely buried in SEO spam, such that the
legitimate reviews are _impossible_ to find, no matter what, by anyone, then
it's pretty clear the public loses something. It's like air that you can't
breath anymore because it has too much pollution in it. A lake can literally
be too toxic for anyone to camp by it, even if it doesn't belong to anyone.

Now what may irk some people here even more. What if we don't completely bury
the legitimate reviews, but only adulterate them with paid shills? Before I
get to this, let's take a simpler example of attacking a public scientist or
activist's message by 'poisoning the well' (attacking their credibility in a
false and underhanded way, just to keep the audience from appreciating the
message.) In my world-view, there are whole fields and areas of human endeavor
which have NO credible scientists and are ALL opinion. To me, the freely
available opinions of credible researchers who have invested months or years
into understanding to tell me about it is also a kind of 'public good.' There
is no reason anyone has to lie to me about how photosynthesis works, and YET
it is part of the public good that I can do a google search and immediately
get to credible opinion on it. Luckily, photosynthesis is one of the few areas
of humanity where there is simple, credible agreement.

If someone were to add a bunch of 'poisoning the well' type junk, then
photosynthesis would be like the effects of smoking on the human body, would
be like the causes of automobile accidents, would be like labor conditions in
China, would like a million different subjects that just have opinions on them
but no real credible consensus for anyone who searches. We should cherish
credibility and it should be a crime to knowingly "poison the well" in my
humble opinion.

Now we return to what I was saying about paid product reviews. In this case,
genuine customer satisfaction is also a kind of "public good" -- if you dilute
it, it disappears, and if you dilute it enough no one reasonable would ever
search for "BlackHole5000 review", since the result is as good as guessing: no
relationship with customer experience.

But if it becomes ILLEGAL to dilute it in this way, and these laws work, then
something magical can happen. Suddenly, if people know that googling for
reviews 'works', then if the BlackHole5000 is off the charts, then anyone who
is curious enough to try the Google search will see this, try the
BlackHole5000 and within a few years it is a cult icon that truly deserves a
Wikipedia article. Which never would have happened if customers knew that
searching for reviews online was useless.

Basically, if we want to live in a world where better products win, then I
think we should cherish the 'public good' that is customer opinion on that
product. The most obvious objection about free speech already doesn't apply to
being able to say whatever you want to sell your product (e.g. 'the
BlackHole5000 cures cancer our studies find', without any mention of the FDA)
so why should you be able to pay others to talk about your product as though
they weren't paid?

Basically, it's hard enough to get people to put up a genuine review that is
useful, period. (It takes work and thought). We should cherish the few
results, when they happen.

~~~
its_so_on
And just to add something so it's not all about product. Imagine the surgeon
who will do your next operation happens to have been sued for malpractice, and
lost, on this very operation, by not one but three former patients. But you
wouldn't know that by Googling his name, which you do, because rather than
invest in training to better himself, he pays someone to SEO fake patient
reviews of his excellent work, burying the negative reviews (which only a
fraction of the affected patients take the time to write): these negative
reviews could save your life or quality of life. But they won't. (This is
especially true if you are very, very rich and can shop around for the true
gem of a surgeon. Assuming you can find him or her...)

------
minouye
Cool idea but a couple of concerns:

1\. With a sub-affiliate model, affiliate scammers will be all over this
(especially if there is no real vetting process). These are the type of links
that Twitter spammers would love to pump out in the wild.

2\. Would any of this traffic be incremental for a merchant? For example, if
my buddy asks me what TV to buy wouldn't I tell him my true opinion regardless
of the payout I received?

3\. Right now it looks like they're using Viglink (<http://www.viglink.com>)
for affiliatizing (at least for eBay). I would seriously wonder how willing
merchants would be to get onboard directly.

I'm excited for innovation in the affiliate space (which is sorely needs), but
this is a really tough problem. Fraud and incrementality are two things that
need to be addressed before a merchant would be willing to sign up (esp. if
they don't have much budget free to work with).

------
inuhj
Ok, I signed up in hopes I could get refer.ly started for my company. I don't
see any option for business owners.

Just found this: "How Can I Check Whether You Have Rewards Available for a
Specific Link?

Referly provides rewards for purchases made on thousands of websites. Stay
tuned, we look forward to offering a directory in the future. For now, if you
have a specific question just drop us an email."

Are you kidding me? How do you launch without this feature? I feel like you
just wasted 5 minutes of my time and that leaves a nasty taste in my mouth.

Edit: Where do I go to delete my account?

~~~
dmor
Sorry to disappoint you. For teh sake of getting this out the door and in the
hands of users we haven't built our a directory page yet but its in the works
- we move fast. You can also request a specific product/reward here (not yet
publicly linked on the site) <http://refer.ly/business.php>

But if you still want to delete your account just email support@refer.ly and
we'll take care of that right away

~~~
citricsquid
I think the issue is more that without a directory your product is useless.
How can I see when I'm going to get a reward if you don't tell me? I've signed
up like the person you replied to and I've shortened 2 links, but there's no
indication if I'm going to get a reward and if that's the case what incentive
is there for me to use the link?

At the very least can there be a tick or cross next to the links to confirm
whether or not your system supports it? The cynic inside of me wants to say
that you don't actually have all these companies signed up, but I doubt you
would lie so brazenly... although how you had the time to sign up thousands of
retailers and no time to build the product into a usable state confuses me.

~~~
dmor
Providing a check mark or some kind of validation as to whether or not a link
is covered for rewards is a great idea, I've added that to the list of
potential features.

I understand the cynicism - the entire affiliate world is pretty shady, which
is why I'm so determined to disrupt it. We are using 3rd party services to
help us get reach across top merchants online. Sounds like this part of the
service needs more attention earlier than we thought - thank you.

~~~
mrtron
Saying the entire affiliate world is shady is intellectually lazy. There are
many areas of the industry that are very stable and mature.

~~~
swalkergibson
Which areas are stable and mature? Countering a generalization with another
generalization does not an argument make.

------
alohahacker
I have this idea myself for many years and even had a friend build his funded
startup around this concept for the past year or two.

The biggest issue is with compliance with the companies. There is a reason the
affiliate process is vetted and takes alot of steps to make sure your serious
about promoting. You indirectly represent the end company when promoting your
aff link.

When you have someone blasting their affiliate link all around the web and on
twitter it doesn't sit well with the end company and they usually bear the
brunt of the compliants.

Good luck on the idea. If you can make it work the all the props.

As a affiliate who LOVED promoting on twitter and would see up to an insane
$40 EPC on tweets, a freinds influence is great.

~~~
omarchowdhury
$40 EPC? That would be $40 per every click you get from Twitter.

~~~
alohahacker
yup i would get up too $40 EPC for some tweets but usually averaged in the
$15-$30 range.

when you create value, people will click and most likely buy. on twitter, you
can see what exactly is on their mind so it becomes pretty transparent what
they specifically want when they tweet.

------
mikepmalai
I'd focus more on the analytics than the affiliate revenues. Most bloggers
I've spoken with on the topic say the visibility/analytics they have on their
affiliate revenues is poor. Most affiliate programs will give you click data
but beyond that you really have no idea what's being bought, what's driving
your affiliate revenues, or the value of your visitors.

I had a blogger friend recently pitch a project to a luxury brand and one of
the first things the brand asked for was ROI and purchase data on the blog.
She could piecemeal some of it but it's a challenge.

On the flip side, advertisers/brands are asking for more ROI and conversion
data to identify who is actually driving sales.

------
aes256
Is there not a US equivalent of Quidco (<http://www.quidco.com>)?

For genuine friend-to-friend recommendations, I'd rather refer a friend of
mine to make a purchase through Quidco and have them claim back the full
referral fee themselves (minus a £5/year subscription), than pocket the
referral fee myself.

If I was linking to a larger group, why should I go through Referly and not
set up an affiliate account direct with the merchant? In the UK, at least,
there are large networks like AffiliateWindow, CommissionJunction, etc. that
allow you to sign up with numerous merchants using a single interface...

~~~
alexatkeplar
Seriously, this. I just checked my Quidco account - I've made £283.13 cashback
via Quidco in the last two years. The vast bulk of that from big ticket
purchases (e.g. flights, hotels) where I've remembered to log in to Quidco
first.

By contrast, the amount of money I could make from recommending books, movies
etc to friends via a Referly would be in the pennies.

To sum up: Quidco, I just remember to login before I buy a big ticket item,
and literally make hundreds of pounds. Referly, I have to convert all of my
product links to Referly affiliate links in the hope of making pennies.

~~~
cjrp
They have a Firefox add-on too, which brings up a little bar at the top of the
page when you visit one of their partners, advising you that you could earn
cashback.

------
sasha-dv
First of all, congratulations on your new venture!

Correct me if I'm wrong, but as I understand it, refer.ly is basically a
middleman. If that's so, I have a couple questions:

1\. What incentives do I have to sign up with refer.ly instead of going
directly with companies that run affiliate programs?

2\. What makes refer.ly different from existing middlemen like Commission
Junction?

~~~
dmor
The key difference right now is that you have 1 signup, and you're done...
that's our minimum viable differentiation (for now)

~~~
aes256
Are you sure you're not trying to simplify a process that just can't be
simplified anymore than it already is?

For instance, how are you going to handle the veritable smörgåsbord of unique
terms and conditions that come attached to each merchant's affiliate schemes?
How are users going to be informed of these terms?

Perhaps more importantly, how are you going to deal with people who violate
these terms? What happens when one of your users starts using your links as
part of a Google AdWords campaign, bidding on keywords that a merchant
specifically prohibits?

What happens when a user starts sending your links in the form of unsolicited
emails, or starts offering an incentive for people to make a purchase through
a referral link — both practices that are commonly prohibited by affiliate
schemes?

------
psychotik
Nice idea. I see this benefiting influencers and folks with larger number of
followers on social channels, but everyday folks are unlikely to see any
significant revenues here IMO. The fact that influencers are more likely to
adopt it means it has good odds of taking off in popularity though.

Someone like Pinterest doing this implicitly and crediting users (with non-
monetary perks even) might have a better chance of impacting the average user
I think.

I'm looking forward to seeing how this progresses though. I hope the team
shares how it's working out for users a few months down the road.

~~~
dmor
Thanks! I think non-monetary and group rewards will be huge, because unlike
cash they are something that can be made available to a very broad set of
users.

We plan to be as open as we can week to week about our progress, and how our
users are doing with earning cash and other rewards. We'll be blogging...

------
patja
I spent 5 minutes trying to figure out how it works without signing up and
gave up. The site is very skimpy on details. What are the typical commission
rates? How do the commissions compare to Amazon affiliate rates? What is the
advantage of using this service vs. existing affiliate programs? Feels like
you are trying to appeal to the naive by just saying "magically get paid by
talking about products"

~~~
fxmartini
And what % of the commission is Viglink taking since it's their affiliate
links?

------
iceron
Judging by its appearance, I'm guessing this won't have any business options?
Would be nice to have a centralized product like this that saves me from
having to find/sign up for each individual affiliate program. Plus having all
the analytics data in one place, too.

Right now it seems to be super early stage. No database of affiliate programs
that they have and you can't even withdraw rewards (earnings).

~~~
dangrossman
> Would be nice to have a centralized product like this that saves me from
> having to find/sign up for each individual affiliate program

<http://skimlinks.com/>

<http://www.viglink.com/>

<http://www.123linkit.com/>

~~~
iceron
This is super helpful. Thanks!

------
rokhayakebe
I believe it would be best if the company gave users Karma as opposed to
money. When someone suggests a store and you know they will earn $ if you buy
from it, you start to doubt their motive. With karma, I do not have to worry
about this, and latter the score can be used to spot "influencers".

------
dabent
There are a few problems here. FTC disclosure, affiliate tax laws and mostly
that icky feeling people get when they get spammed, especially by friends.

But in the eyes of YCombinator, I don't think this matters, because they
aren't betting on refer.ly. They're betting on the woman who's founding it.
PG's been pretty open about betting on the people and not the idea. Based on
the article (and Dave McClure's glowing recommendation) it seems like a pretty
sound bet.

------
acoyfellow
Now, all I need is an API that a service like Ifttt.com can hook into.

I'd like to use this service in between the others I use. (When I Like
something on facebook, it gets tweeted, for instance...) I want it to be able
to shorten my link and it get tweeted automatically. Doable?

~~~
dmor
Definitely doable, I love Ifttt and seeing Referly API + Ifttt would be a
dream come true. API added the feature request list, thanks!

------
thegyppo
This just seems like a wrapper around Viglink? Not entirely sure what the
value add is here other than shortening URL's.

Viglink IMO take 25% off the commission, which means 75% is available to go to
Refer.ly/User. Not sure what percentage Refer.ly is planning to take for
themselves but might not leave much left for the user.

As someone who has built a platform that aggregates all the affiliate networks
into one place, it's a royal pain. Viglink take away that pain, but for a
price & in order to provide the best value to your users in the long run
you'll probably have to become an aggegrator yourselves.

------
samstave
I read the name as "reefer".ly

~~~
alabut
That's hilarious. I was jamming out this design all weekend and never once did
it occur to me, then I get this and a few tweets about it. Let's call it an
unintentional in-joke then :)

------
cjrp
I don't know.. I'd feel a little sleazy sending a referral link to a friend.

~~~
MartinCron
I imagine this would self-correct eventually. If my friends did nothing but
send me referral links... well, I think I could stand having one fewer friend.

------
tomjen3
That is going to burn down so fast when the affiliate sharks starts biting.
Affiliate is basically the webs version of HFT -- millions can be made, and
lost, in a matter of a few minutes.

------
rexreed
If I was interested in having people refer customers for my SaaS app, is there
a way to sign up for refer.ly to generate and track these sort of referral
links?

~~~
tlianza
I think you're looking for something more along the lines of "roll your own
affiliate program" - check out <http://www.hasoffers.com/> (I have no
affiliation with them, other than they're a local Seattle startup)

------
lucian1900
I wonder if all these companies registering their domains in Libya will get
bitten by it at some point.

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10dpd
How is this different to LinkShare, TradeDoubler etc?

