Hostgator Affiliate Scam
April 16, 2010 by Major Affiliate · 1 Comment
It came to my attention about a year ago when hosting giant Hostgator started extending sales through Commission Junction. Later we would discover that over 50% of extended sales would be reversed. Commission Junction, a leading affiliate network provides tracking and management of Hostgator’s affiliate program. Typically when a CPA has occurred the affiliate would receive payment for their commission after 30 days. An extended sale allows for merchants to extend the commissioned sale for 60 days. This is useful for merchants that offer a 30 day return policy.
For three months we logged all activity through Commission Junction tracking sales/commission. By the third month we decided to test and see if Hostgator was truly scamming its affiliates. Luckily for me I knew someone who was looking for a hosting provider. I sent them over to my site to sign up and the next day I saw the commission posted to my affiliate account.
One week later the commission was extended. So after 37 days I was shocked to see that the sale had been reversed. I immediately contacted the person who I knew signed up for Hostgator and asked if they where still hosting with Hostgator and his reply, “Yes”.
So taking this information in account, I went back to my data and discovered an odd pattern. Within the past five months Hostgator has been reversing over 50% of my sales. Within this past month I have had 100% reversals…yes EVERY sale was reversed. I had 27 sales amounting to over $3,375.
Now most of you are thinking this could be a result of my site and the traffic I send them, however I do not use PPC and all traffic is organic. My site ranks #1 in every search engine for a popular hosting keyword related to Hostgator. I have read through Hostgator’s affiliate terms and conditions and have not violated anything.
I know the economy is down and companies are making cuts to reduce cost but when you sink low and start scamming people who are bringing you business, you reached a new low. Even though Hostgator as a hosting company is great, sadly as an affiliate program they are terrible.
As I am writing this I am still waiting for a response from Commission Junction and Hostgator. It has been a week and I have not received anything from either of them. I will post an update once I receive it.
The same has been happening to me. Hostgator used to reverse ANY signup if they could not reach the signup on the phone they provided upon signing up for their hosting. Let me ask you – how many people input their real phone number into the form when they sign up? Very few, who wants to get spammed by annoying sales calls? It is their convenient excuse to not pay you a dime, even though the signups are STILL hosting with Hostgator, even for many years. Hostgator is a complete scam as affiliate program goes – promise high payouts to attract suckers to send you free traffic and money, then screw them on a technicality that you KNOW in advance happens in 80% of cases. Someone should really take these scammers to court – all the affiliates that got screwed by them should find each other band together and pool funds to get a good law firm after these Hostgator scammers.