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New York is attempting to force e-Commerce businesses to pay the New York sales tax on any sale originating from a New York based affiliate.
Affiliates are a great method of online guerrilla marketing. The blogs and reviews come off as very trustworthy to shoppers. And how convenient - here's a link to this online store who sells this product. I guess I'll buy it (or remember this site when it comes time to buy).
Affiliates play a major role and the New York law may have a trickle down effect. If NY wins, other states will join. As such, companies will cut their affiliate programs to cut costs. This will cut into revenue for e-Commerce sites and require the affiliate tactics to be done in-house.
Don't know about the rest of you, but we're anxiously waiting to see how this turns out. What are your thoughts?
New York is attempting to force e-Commerce businesses to pay the New York sales tax on any sale originating from a New York based affiliate.
I wonder how this should technically work ?
Guess that no business will have official New York based affiliates... instead of paying them a commission for done sales, they simply pay a "consultation fee" or something that cannot be associated with affiliate marketing ;-)
Also if an affiliate just forwards visitors to your website (just click-through commissions), it is nearly impossible to know which sales origin from which affiliate. The necessary tracking would be quite tricky.
And I thought that Europe's sales tax system is complex ;-)
Also if an affiliate just forwards visitors to your website (just click-through commissions), it is nearly impossible to know which sales origin from which affiliate. The necessary tracking would be quite tricky.
The tracking implemented by affiliate programs is no more tricky than any CPC model. The publishers include their ID tag to any of their links which adds a tracking cookie to the visitor's machine to track the sale.
Most of the reporting available even offers what publisher is linked to each conversion. So, everything is really in place to set up paying additional sales taxes. I'm just crossing my fingers it gets over-turned.
New York is not the potential problem. The potential problem is that other states may follow suit - forcing affiliate advertisers to pay/charge the state's sales tax that the affiliate resides. This could be very harmful to a very popular method of advertising for e-Commerce stores.
New York is not the potential problem. The potential problem is that other states may follow suit - forcing affiliate advertisers to pay/charge the state's sales tax that the affiliate resides. This could be very harmful to a very popular method of advertising for e-Commerce stores.
Personally, and I realize I am unusual in this respect, I've never read anybody's blog. When I shop online, which is where I do almost all of my shopping, I read the reviews on the site for a product or products I'm interested in. To me that's a much more useful and trustworthy approach than linking to a blog.
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Small Business Computing Online Community Manager
Personally, and I realize I am unusual in this respect, I've never read anybody's blog. When I shop online, which is where I do almost all of my shopping, I read the reviews on the site for a product or products I'm interested in. To me that's a much more useful and trustworthy approach than linking to a blog.
Just can agree... I never have read a blog just to make a buying decision. Blogs are surely fine as a way of distributing whitepapers (and therefore also important for SEO), but I don't think that they play a big role when it comes to product recommendations.
The new law led one store, Overstock.com, to drop its affiliate program in New York. Overstock has joined Amazon in its legal dispute against the state
This is what I think will end up happening with all affiliates if New York does not back down. They are seeing the affiliates as constituting a physical presence in that state.
I never have read a blog just to make a buying decision. Blogs are surely fine as a way of distributing whitepapers (and therefore also important for SEO), but I don't think that they play a big role when it comes to product recommendations.
The affiliate network is much more than blogs. A strong majority of all coupon based sites are affiliates.
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