eBay Bans Affiliates from Using Paid-Search Campaigns

By Ina Steiner
AuctionBytes.com
May 17, 2007

eBay is increasing the payout to members of its Affiliate Program effective June 1, 2007, but is disallowing paid-search traffic purchased from Google, Yahoo and MSN for its US members. eBay's Affiliate Program allows third-parties to earn revenue for driving bidders and buyers to eBay listings.

Some affiliates generate traffic to eBay through advertising, but as of June 1st, eBay will no longer compensate affiliates for "paid search traffic purchased from Google.com, Yahoo.com, MSN.com, nor from any of their content networks, such as Google AdSense, Yahoo! Publisher Network, and MSN ContentAds, if it is linked directly to the eBay.com, eBay Express, or eBay Store domains."

One affiliate said the change may have been prompted by Google's decision to limit the number of eBay affiliate ads per search result page to one.

It's also possible eBay may have felt that affiliates purchasing keywords on search engines were driving up the cost of the ads, which it also purchases from search engines. In addition to higher keyword ad costs, eBay then had to pay out affiliate revenue to these "advertising competitors." However, it's not known how significant the effect of eBay's affiliates has been on Google's keyword pricing. An affiliate said it was eBay that increased the cost of keywords through its bidding practices starting about a year ago.

eBay affiliates have run into problems with Google in the past. In an incident AuctionBytes first reported that was later profiled in John Battelle's book, "The Search," an eBay affiliate had created doorway pages that converted links on Google search results to eBay search results using cloaking techniques, which are banned by Google (http://www.auctionbytes.com/cab/abn/y03/m10/i24/s00).

As for news of eBay's pending changes, some affiliates complained on discussion boards about the new ban on paid-search campaigns, others were pleased and said they would earn much higher revenue through the higher payout rates.

eBay is increasing the referral fee for a new active confirmed registered user (ACRU) from $12 to $25 in the first tier (1 - 49 ACRUs). eBay created a new top tier of 30,000+ ACRUs with a rate of $35 per ACRU; formerly the top tier was 3000+ ACRUs with a rate of $22 per ACRU. The revenue share also increases from 40 - 65 percent of total eBay revenue generated, to 50 - 75 percent of total eBay revenue generated.

Commission Junction administers eBay's Affiliate Program. eBay changed the program in March so sellers could earn affiliate revenue on bids placed on their own items; they still may not put affiliate links on eBay pages, but they may include links on their websites or blogs.

http://affiliates.ebay.com/odcs/custom.htm?template=Payout

http://forums.ebay.com/db1/thread.jspa?threadID=1000495149