Affiliate Marketing Ethics vs Pay Per Post

PayPerPost and affiliate marketing through articles and blog posts are both frequently cited as prime make money online opportunities. For make-money bloggers, both seem the perfect arrangement; just write posts about products and services, then get paid. You don’t have to worry about developing products or gathering advertisers, but you can still make money.

Some condemn PPP as unethical, but affiliate marketing is generally supported in the online community. Is affiliate marketing intrinsically more forthright and ethical than PayPerPost, or is PPP held to a higher standard than affiliate marketing?

What’s the Standard?

Just over a year ago, the Federal Trade Commission announced companies engaged in word-of-mouth marketing must disclose when people will be compensated for promoting products to their peers. PPP follows this regulation and requires bloggers to disclose their relationship in the post or a site-wide disclosure statement. PPP has even built a website to help bloggers create a disclosure statement. However, most affiliate marketing programs do not require disclosure of any kind from their affiliates.

PPP pays bloggers to write posts for specific advertisers in the form of feedback, reviews, or general buzz. Ideally, the bloggers (PPP calls them “Posties”) select advertisers with products in their interest area. Most Posties are not making big bucks from their efforts. According to PPP, “With a little hard work and marketing our Posties can easily make $500 a month or more.”

In affiliate marketing, individuals are rewarded for each person referred to a company’s website when that visit (or a subsequent visit when tracked by a browser cookie) results in a sale. Affiliates usually promote products by writing articles, blog posts, reports or ebooks, or by placing linked banners on a website. Affiliate incomes vary greatly, from an occasional few dollars to thousands of dollars on a regular basis. While affiliate banners establish a clear advertising relationship between the site and the product, reviews and comments within posts are not always as clear.

Word-of-mouth advertising is already covered under the same FTC regulations governing commercial endorsements, but the FTC has sought to indicate peer marketing could be deceptive if consumers were likely to trust the endorsement “based on their assumed independence from the marketer”. Mary K. Engle, FTC associate director for advertising practices stated, “We wanted to make clear . . . if you’re being paid, you should disclose that.”

Where’s the Rub?

Aside from any FTC regulation, disclosure appears to matter to readers. According to The Washington Post:

“A 2005 survey of 800 consumers by market research firm Intelliseek found that 29 percent of participants age 20 to 34 and 41 percent of those age 35 to 49 said they would be unlikely to trust a recommendation again from a friend whom they later learned was compensated for making the suggestion.”

The argument against PPP usually asserts paid posts are biased and might not have been written if the blogger had not been paid. Bloggers often respond with the argument they do not allow the financial relationship to influence their posts, and in fact PPP posts are sometimes negative. While some PPP advertisers will accept only positive comments and reviews, bloggers are free to limit their relationships to advertisers who allow either positive or negative reviews of their products. Opportunities also exist for Posties to create video and podcasts without expressing an opinion, merely to create “buzz”.

Affiliate marketers, on the other hand, are usually motivated to write positive reviews and comments since they are paid only when a sale results from the referral. Again, many affiliates state they will only refer their readers to products they believe in. But would that referral have been made if money wasn’t involved, and how certain can an affiliate be their favorable opinion wasn’t in some part shaped by the prospect of getting paid?

Is an affiliate relationship really any different from that of a Postie and their advertisers? Even if an affiliate does choose to disclose the relationship, why would that make it any more ethical than PPP?

If affiliate marketing is ethical, then isn’t PayPerPost ethical too? By the way, the PayPerPost link at the top of this article is an affiliate link.