Before we dive head first into this post, I would like everyone to know that what you read from here will likely be the ONLY source of publication for a topic of this nature (unless of course you catch the wickedfire forum thread). (Thanks go out to Mike and Gennadiy for real info). As we all know, and as I have preached for a long time in this industry, we have a lot of…how do I say this politely?….Absolute ball-less people in this industry. Since we all know and understand that I have pair, and I’m probably the most “professional” person you will ever meet, allow me to enlighten you on the events that happened and really put a kink in a lot of businesses today on the interwebz in the cpa industry.
First off – With my Twitter posts, Facebook posts, and my captivating forum posts around the web, I’m not going to ask, I’m going to tell you to STOP ASKING ME IF REBILLS ARE DYING. Ok? I’m not a genie, I dont have a crystal ball. What I have is my brain, my eyes and my ears which are ALWAYS open and looking for information. I give the information as it comes to me and asking such a question is just begging for speculation and if I were one to speculate well then…that makes me the biggest asshole in the world if I were wrong correct?
Moving along…
Ok so a lot of rebill offers went down today. What we have here is a miscommunication of “why” they went down and more importantly we have a ton of “speculation” on events that have not even occured yet. Speculation is a real bitch in this business. Trust me on this one. People talk all day online behind a computer screen and they hear and read all sorts of shit and then they go running their mouth as if they had the slightest clue as to what’s really going on when in fact they have received all the pertinent information to complete the story.
Anyway…
What happened to the rebill offers that went down today? One of the largest issues (and I say largest because this is the one that directly affected most of the offers I know of today) is that Meritus Payment Solutions is one of payment solutions used by quite a few advertisers in this space. Now the blame doesnt go to Meritus because their Registered ISO/MSP is Wells Fargo Bank. Wells Fargo Bank has bailed from rebills/continuity/negative option billing (or whatever else name you want to come up for it).
What does this mean? This means we had some advertisers heavily relying on Meritus and now business is in chaos BUT……..business always resumes for the ones who have their stuff organized. There are literally a ton of merchant options out there people. Much like the explosion of CPA Networks this year, there has been an explosion of advertisers in this space. A lot of them who are complete retards and want to make the quick buck and dont plan their businesses in a smart and strategic manner.
As a publisher if you relied on Google Adwords for 100% of your traffic and woke up one morning to see that you have been banned, do you pack up shop and quit or do you suck it up and find other options?
Enjoy that analogy because that’s what it’s like for the advertisers today who were relying heavily on just one merchant service. Things change, people adapt and smart businesses find a way to succceed.
So the death of rebills is NOT upon us currently. There are still a multitude of options as a cpa marketer out there to promote and their will continue to be more options coming in the future. We are an industry in it’s infancy and nobody likes “baby killers”, they like to see the child grow. So stop jerking around and get back to business.
11 Comments Received
January 1st, 2010 @12:43 pm
Always appreciate your up-front and honest posts, Ruck. Super informative.
Here’s to a successful 2010 in whatever niche you’re going after. Good luck this year!
January 1st, 2010 @2:00 pm
Good shit here !
I am surprised in how tons of new company’s come up and have no plan set in action if one thing changes. You always need to have more then 1 plan. And with all of the other merchant options I am surprised that a lot of these companies did not think to even look into something else.
But that is how the crap businesses will die out and the smart ones will rise even more.
January 1st, 2010 @2:09 pm
Ruck
Thanks for telling it like it is. You have a business sense to see beyond the obvious. Let’s face it though, everyone has read too many of “The Easy Way to Get Rich” ebooks and reports. They drank the cool-aid and followed it exactly, and paniced when a roadblock developed. When your advice is reduced to a single word it might be “DIVERSIFY”. I cant count the number of traffic sources and campaign strategies you have documented in your blog writing, all of which stress the diversify theme. Keep it up. Some of us are listening.
Solvetheproblem
January 2nd, 2010 @2:15 am
From what I understand, Visa is behind what is happening right now. If Visa changes regulations, it doesn’t matter what merchant account providers you use.
January 2nd, 2010 @5:21 am
Happy new year Ruck hope you the family are well,loved your post, you still tell it as it is, don’t ever change. regards nicho
January 2nd, 2010 @1:23 pm
If Wells Fargo (which also bought Wachovia) is backing out of auto-rebilling, how long will it be for others to follow suit.
On Dec. 15th of this month, In a regulatory filing, here is what the largest issuers of credit cards reported their charge-offs were (these are loans the company does not expect to be repaid on, in other words a loss):
- JPMorgan Chase & Co, the largest U.S. issuer of Visa-brand credit cards, rose to 8.81 percent in November from 8.02 percent in October.
- Capital One Financial Corp said its charge-off rate rose to 9.60 percent from 9.04 percent
- Discover Financial Services said its rate rose to 8.98 percent from 8.54 percent
- Bank of America Corp, the largest U.S. bank, said its charge-off rate fell for third straight month — to 13.00 percent in November from 13.22 percent in October. However, it is still the credit card issuer with the highest default and delinquency rates.
Negative option is more than likely a good % wise component of the total %’s above. As consumers will more than likely not have the guilt of not paying for something they felt they got little or no value from. n addition, customer service costs for these types of transactions is increasing, further reducing the profitability of negative option. So Wells Fargo stopping continuity (rebills) is more a function of their bean counters seeing costs exceeding profits for this type of transaction.
The old school approach will always win, make a great product and great marketing is easy. QVC does “AutoShip” very well. So does Omaha Steaks. Order something from them and see how they get some of the highest per annum customer revenues by being great at being relevant and provide value/benefits to their members.
Continuity is a terrific benefit if it is nurtured and treated as a continuous relationship. The worst advertiser offenders are those who take a “set it and forget it” attitude toward the very people that pay their bills for them.
I am looking forward to the shakeout and what eventually will be the most profitable model for both publishers and advertisers.
Thanks for breaking this news on your blog Ralph. See you in Vegas.
January 4th, 2010 @5:08 pm
Great Insight.
January 5th, 2010 @9:44 am
Now might be the time to start looking at alternate way of processing payments online other then credit card…
January 13th, 2010 @6:26 am
you mention there are a lot of merchant accounts out there that work with re-bill offers. Could you provide a few resources for those of us who are starting out in this and looking to do things the RIGHT way.
January 13th, 2010 @11:53 am
@eric – I can do BETTER than that bud
http://www.merchantmaverick.com/
Enjoy!
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