on 25 September 2009
Bing… incoming press release from HotelsCombined, a Sydney based hotel reservation company.
They have launched a new scheme to guarantee 100% up-time to their affiliate partners.
“Through this agreement, affiliates of HotelsCombined.com can rest assured that the site will remain available to Internet users 100% of the time. If in the unlikely event the operation of the site is interrupted for any extended period of time, 100% of the missed commission earnings will be credited to the partner’s account.”
Is this for real or just a wacky plan that has been dreamt up in a marketing meeting in order to achieve a quick PR buzz boost?
100% uptime is a very tough target.
Digging deeper in discussions with their head of affiliates, Adam Zebrowski, I have found out the following:
- The policy is for their website only – if one or two of their upstream hotel content providers don’t return results within the timeout period they won’t take any responsibility for it (but other than that, it covers full system uptime which means any planned maintenance will still incur an account credit).
- Only 1 downtime event would have paid out in the last 6 months – a DNS issue caused by a denial of service attack on their DNS provider.
- The onus is on the affiliate to request a credit request – rather than credits being applied automatically
I would prefer to see a full system guarantee that includes all their hotel product suppliers.
I was once involved with a hotel distribution company and many of the providers had 2 hour maintenance windows at various times (normally weekend). When you totalled all the windows up (and they never occurred at the same time) it meant our full system uptime was significantly impacted (as we needed all suppliers to be operational for our system to work). HotelsCombined need to offer the 100% uptime guarantee over their entire system, not just their website in order for the guarantee to be credible.
The second key change I want to see is that the onus for requesting payout should be on HotelsCombined not their affiliates. Credits should be applied automatically.
Without these two changes it is a little too much of a PR buzz idea than a genuine advance in how HotelsCombined will work with their affiliates.
What do you think – is this a PR puff or for real?
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Alex: It has the aroma of marketing to me. I guess guaranteeing lost commissions is a nice thing, but the site’s total downtime in 2008 was 64 minutes. Now, if Google would guarantee to make companies whole for all of the lost business due to gmail outages — like yesterday’s — then that would be something else.
Another thing – if the HotelsCombined site is down, on what basis will the affiliates be able to claim their lost earnings? If the site is down, the booking can’t be made – if a tree falls in the forest and no one is there to hear it…
And it would be more credible if the told their affiliates about it.
Not a mention in my inbox or on the ‘news list’ of my affiliate page.
Troy,
If it were a new affiliate that was being referred into HotelsCombined, the click would be lost for sure and with it, any potential commission earned.
The question probably needs to be asked and answered, how are ‘missed commissions’ calculated? They could average your last x months earnings and top up your account with x many hours worth of downtime calculated against your previous earnings or something entirely different.
Al.
Thanks for the comments everyone.
Here are some direct quotes from HotelsCombined defining how they calculate what is owed (and why it is tricky to credit affiliates automatically)
“Credits are calculated based on statistical deviation from norm. You can think of it this way: We plot each Affiliate’s revenues on a graph, and then apply a credit that brings revenues over the outage period back up to the expected value. It’s difficult to be exact, so we add a little extra as a buffer zone.
It is unreasonable to assume we can automatically apply credits, because we can’t make assumptions about our Affiliates’ traffic volumes over the outage period. We need to ensure that the measured impact was due to the outage, and not to the Affiliate making a change to their traffic generation strategies. This is why we currently ask any affected Affiliates to contact us with the credit request, giving details of any changes to their traffic volumes over the outage period.”
So yeah, I did ask the question!
Hi Al,
That’s exactly my point. Without a clear definition of how the affiliates are compensated for the downtime, the guarantee seems a little hollow. What’s interesting though is if they are successful (in creating a lot of PR Buzz) it would suggest that perhaps there is a genuine issue / grievance with the CPA model in general that needs to be addressed…
T.
Interesting, but I don’t know if it will generate the response they were looking for, or should I say the level of response they expected. I don’t know of too many major sites that go down for extended periods of time anyway. Why do they need to offer this? was the service poor in the past? Even having to set up and advertise something like this weakens my trust in the brand.
Sounds like a response to past criticism as I havent seen this problem (Downtime) in the Australian market.
@Alistair Calculating those missed commissions sounds like a very manual time consuming process with a ton of touch points. I wonder if just paying them out WITHOUT being asked could have been cheaper than hiring people to answer/process the requests?
Only a super affiliate like perhaps Skyscanner who are currently using the hotelscombined whitelabel would have anthing much to gain from making a claim unless the whole site goes down for a few hours or more.