Promises Promises: Why Not Just Pay Cash?
  Written By Raven

I wonder how e-commerce survives. For almost six years, I've heard and seen the same thing happen over and over again. I've fallen for it myself, with disastrous results. I see others practically wet themselves with excitement during the honeymoon phase, before the concept becomes an action verb.

What I don't see is an exchange of money for services. While the barter system is still alive, all that involves is the trading of services. If one person has content and the other knows web design, they can readily make a one time deal to exchange talent for talent. The web site gets created and the designer gets content and everyone is satisfied. I've written tours in exchange for designs or programming and we've all profited from the deal. Not one dime has been exchanged, although my accountant isn't pleased because there isn't any paper trail for her. She's only happy when I have receipts; but, slowly, she is learning that bartering is not a bad way to go and has even done it herself when she needed her house painted and the painter needed his taxes computed.

What I'm talking about here is something pervasive in this industry. In my opinion, this kind of business model carries many roadblocks and has the capacity to create much ill will.

There was an ad placed on the message board. A company wants a bright, energetic individual to be part of a sales team. Great perks. Offering a fabulous opportunity. Except for one tiny detail. The compensation is a percentage of the earnings. There's no mention of what the percentage is or whether there is any reason this percentage will be worthwhile for the time expended selling this program. What bothers me is the expectation placed on the representative, who will have to live on good looks and charm with which to pay his bills, as he patiently waits for the earnings. Newbies are especially receptive to these offers. They see the promise and believe the pitch. They haven't yet learned about sites whose time never comes.

There was an offer made to me, recently. This webmaster wanted me to write articles for him. I believe his words were 'out of the goodness of my heart'. My perk, or pay, was to have free advertising for every article I wrote. One of the reasons I don't advertise is because most of my business comes from word of mouth. Personally, my preference is cash for services. I've already been through the learning curve of writing articles in exchange for text links or banners. For me, it doesn't work. I can't speak for others; but, the return on investment doesn't seem worth it.

In the meantime, at the conclusion of this project, he would have nine hundred reviews, written by a variety of people and the sites reviewed will all carry his referral link code. Who's making the money?

Why not just pay cash? Expect a certain set of tasks to be accomplished, set a wage of some kind and pay the webmaster money. As an incentive, pay a small amount and offer a certain dollar amount per account acquired or sign up to a site by an affiliate. This is how business is supposed to work. You subcontract or outsource what you are not able to do or don't have time to do, call it 'investment', and then execute the project and earn back the investment and then profit from it.

To offer a job, based on future earnings or to expect work in exchange for earnings whose future is dubious, at best, is ludicrous.

It is said that taking risks is part of life. These are true words and accurate. Anyone who owns a business knows all about anxiety when it's decision time. Risks are part and parcel of life's journey. Taking a job based on future earnings is a risk not worth taking.

For the person accepting these conditions, how would he know what he could earn? Would the webmaster have a log in to see the gross earnings, so he knows what his share will be, that his percentage is accurate? Having seen the insides of many affiliate programs, I certainly would not give just anyone access to my stats. This is not a partnership, complete with contract, being discussed here. This is merely a sales rep job, based on a percentage of earnings which does not yet exist. The risk involved is believing the money will be there at the end of the first month.

A promise of future earnings doesn't pay the bills. Money. Cold hard cash. That pays the bills.

Webmasters, who are offered a percentage of ownership for a site, yet to be created, should also pause before accepting. Who owns the domain? Who owns the content? Who administers the site? Who owns the billing account? Whose affiliate code is used for the up sells within the site? What happens if the two or three who are involved get a divorce?

Those are just a few of the issues which arise when entering into a partnership agreement. Because the web site has not yet been created and is unproven in terms of marketability, each party can only dream about what the potential is for this undeveloped site.

Dreaming can be dangerous and contracts, especially verbal ones are hard to substantiate in a court of law. Even contracts are only beneficial relative to the partner's sense of honour and commitment.

My suggestion to all newbies and veterans is this. Don't dilute the pie or give slices of it away. If you cannot afford to develop a site or program with your own funds, then wait until you have the funds to spend.

Remember this. When a site succeeds, no one cares about the percentage, especially when the numbers go over six or seven figures. BUT. When a site does not succeed; or worse, does not perform to the level of expectations, no deal is remembered with accuracy and rationalisations will be created so that all end up with less; or worse, nothing!