So today I get an e-mail from Amazon telling me they no longer are offering their affiliate program to Colorado residents because of the recently enacted HB 10-1193 (that a link to a pdf version of the bill). This new regulations intent is to increase revenue to the Colorado Department of Revenue, but it puts many who are earning a living promoting products on Amazon out of business. I’m sure other high profile companies that have similar programs will follow Amazons decision. When I say puts them out of business, it’s put them out of business promoting items on Amazon. Their is no arguing this comment.

The Colorado law basically says that if you are a company that provides an affiliate marketing program and you generate over $10,000 of income in the state, the affiliate marketer (me), is considered a legal agent for that company. So now Amazon will be required to collect sales tax and remit that to the state.

Here is the important wording to be exact:

COMMENCING MARCH 1, 2010, IF A RETAILER ENTERS INTO AN AGREEMENT WITH AN AFFILIATE UNDER WHICH THE AFFILIATE, FOR A COMMISSION OR OTHER CONSIDERATION, DIRECTLY OR INDIRECTLY REFERS POTENTIAL CUSTOMERS, WHETHER BY A LINK ON AN INTERNET WEB SITE OR OTHERWISE, TO THE RETAILER, THEN THE AFFILIATE SHALL BE PRESUMED TO HAVE SOLICITED BUSINESS ON BEHALF OF SUCH RETAILER AND SUCH RETAILER IS DEEMED TO BE DOING BUSINESS IN THIS STATE. THIS PRESUMPTION SHALL NOT APPLY UNLESS THE CUMULATIVE GROSS RECEIPTS FROM SALES BY THE RETAILER TO CUSTOMERS IN THE STATE WHO ARE REFERRED TO THE RETAILER BY ALL AFFILIATES WITH THIS TYPE OF AN AGREEMENT WITH THE RETAILER ARE IN EXCESS OF TEN THOUSAND DOLLARS DURING THE PRECEDING CALENDAR YEAR.

Here’s the quick and dirty on how affiliate marketing works, and I’ll use Amazon as the example. Amazon sells millions of products all over the world. In order for them to get free advertising of their products they offer what is called an Affiliate Program. (Here is a link to Wikipedia’s definition for more insight). This affiliate program allows me to put links on any of my sites that directs viewers of my website to Amazon in order to purchase that product. If that viewer to my website purchases that product, Amazon will share some of their profits with me. For most items it’s a very small percentage, say 5%-10%. It’s not much, but it can add up, especially if I have a website that has lots of readers and those readers act on my recommendations. For example, let’s say that I’m heavy into photography and I have a hobby website about photography. On that site, I might review or make recommendations on a particular camera that I own. If I write a review about that camera on my website, and provide a link to Amazon where you can purchase that item, and you follow that link from my website and buy that product at Amazon, I get a commission. So in essence, I am acting like a salesman for that product.

I did have plans on adding some affiliate links to books I’ve read on selling on another site I run. My thinking was that since I’ve literally read and own dozens of books on selling, I could make recommendations based on what the books target market was. Guess not.

I didn’t see this coming. I don’t pay much attention to politics anymore outside of what’s screaming at me through various media outlets. Go figure.

This really is a bad precedence for the entire Internet marketing world. I feel sorry for those individuals (many working at home moms), that are waking up today all across Colorado and finding out that a significant portion of their income was stripped away by helpless/greedy money grabbing politicians.

You may express your views of Colorado’s new law to members of the General Assembly and to Governor Ritter, who signed the bill.

Edited to add:

I found this quote from Bill Ritters office in response to his complaint on another blog. I’m sure I’ll get one with similar rhetoric. This man is out of touch. He just doesn’t understand.

Gov. Bill Ritter issued the following statement today criticizing Amazon.com’s decision to abruptly end its financial relationship with Amazon Associate businesses in Colorado:

“Amazon has taken a disappointing – and completely unjustified – step of ending its relationship with associates. While Amazon is blaming a new state law for its action, the fact is that Amazon is simply trying to avoid compliance with Colorado law and is unfairly punishing Colorado businesses in the process.

“My office worked closely with Amazon’s affiliates and associates to modify House Bill 1193 to specifically protect small businesses, avoid job losses and provide a fair, level playing field for on-line retailers and Main Street, brick-and-mortar retail shops alike.
“Amazon’s position is unfortunate, and Coloradans certainly deserve better.”

You don’t get it . Governor Schwarzenegger vetoed a similar bill in California, and a similar bill in New York is being upheld in the courts.  Once large companies (and even smaller businesses)  find out that doing business in Colorado is an unnecessary burden that no other state requires, they’ll simply wash their hands of the whole state.

Hey Mr. Bill… Coloradoans do deserve better. I’m glad you’re leaving.

You seen them on Internet websites, on late night tv, in the back and sometime full page ads in magazines. You’ve wished it true but somehow you either used your better judgment or perhaps you’ve bitten the bullet once or twice and got burned and swore you’d never be taken again.

What am I talking about?

Making millions in your pajamas at the kitchen table. What else? I wasn’t talking about the miracle pill to ‘extend’ that certain part. What were you thinking, silly you.

This is a serious ruling… really… and in case you haven’t been bitten I’ll explain why now it will be much harder to get bitten. With the economy the way it is, I’m glad this consumer protection has been extended to catch up to the realities of the 21st century.

For years, I’ve had a passing fancy… mind you a closet wanna-be maybe… or perhaps a student of sales and marketing that analyses and digests all forms of marketing to see if I can pick up a thing or two that might help me in my business or help my clients in theirs. Internet marketing just happens to be something I have a little case knowledge and success at. But certainly not in the way that technology has allowed the con man at the carnival to flourish.

I’ll paint the broad strokes of the methodology of how these marketers claim to make 6 figures a month, like clockwork by only working 4 hours a week.

Here’s what happens.

XYZ Internet marketer produces a product… sometimes with video, sometimes with audio… sometimes in the form of an e-book, or any combination thereof. For illustration sake, let’s say it’s the latest greatest way to ‘slap google’ and get your website to the top of the search engines.

It could be anything imaginable from teaching your parrot to talk, to getting a herd of customers to buy into your ‘secret membership’ where only the brightest and most talented marketers congregate to cuss and discuss and reveal to each other their most treasured secrets of subject xyz.

So what happens next?

After XYZ Internet marketer creates his product he prices it from $49 to several thousand dollars. XYZ marketer announces to several websites and his identified gang of ‘highly successful internet marketers’ that he is about to ‘launch’ this product and that if any other marketer sells a copy of his product, he is entitled to a commission. Sometimes this commission can be as much as 80% of the selling price and usually never anything below a 50% split.

Now the thousands of ‘affiliate marketers’ start sending e-mails to their lists (other people that either are making money from the internet or those that want to), and start talking up how XYZ Internet marketer is going to be selling this new product in the next few weeks.

What happens in these launches is really laughable if it weren’t reality.

These internet marketers start sending emails saying …if you buy from me (the affiliate), XYZ Internet marketers product, I’ll give you a bonus of thousands of dollars of my product (which I sell everyday at ridiculously high prices and little substance to unknowing nit-wits who want to make millions in their pajamas).

The feeding frenzy begins. Can you imagine the tall tales that are being told to sell this product? Mind you most internet marketers haven’t even seen the package, so how can they talk it up?

You see every internet marketer tells you the money is in the list. So they put up a website claiming to be an expert at something. They write a 10 page book report, call it a ‘Special Report’, give it some outrageous value like $77 and give it away free. Of course if you’re interested in receiving this $77 valuable special report for free , you’ll have to leave them your name and email address and they’ll send it to via e-mail. All automated totally without intervention on their part. How cool can that be right?

Thus the ‘list’.

Over time, these internet marketers accumulate thousands of names on their ‘list’. When it comes time to launch or promote a new product, they endorse that product and start sending out e-mails to their list, priming these other wanna be marketers to buy this new product.

You can see how the lure of easy money can tempt even the most saintly of us to possibly perhaps bend or stretch the truth on xyx product. A lot of times when they really don’t even have the product in hand to truly give an honest endorsement or recommendation. (This being one of the catalysts for this new ruling).

I have studied a lot of these internet marketers over the years and I’ve noticed testimonials from the same people pop up on a good percentage of the sales pages of various products. It’s so pathetic in fact, a couple of very famous internet marketers have a testimonial on the sales pages of products that even compete with similar products of their own. After all, the more times they can get their face out there (and link back to their website), the more credibility and possible residual sales they earn for themselves.

There are other reasons that this new ruling has come into effect. There are flogs (fake blogs), where these internet marketers (or even legitimate offline real world companies) put up a site about xyx product and then place fake testimonials on them. Or some companies have even gone so far as to pay an individual(s) to post a testimonial on their site and every where else on the Internet that someone might be so it creates credibility for a product.

The list goes on. The bottom line is a lot of the fake and false testimonials and endorsements are now going to be looked at a lot closer. All you have to do is simply click on the File a Complaint button at the FTC, and over time these con men are going to leave the carnival.

Don’t get me wrong. I’m not saying that all internet marketers are liars and crooks. But most are, or at least tall story tellers. Some internet marketers really provide solid actionable, legitimate how to information.

I can help you with a simple bit of advice to help you sniff out the players from the Monday morning quarterbacks. It’s simply this. The bigger the claim, in most cases, the bigger the fraud.

If your new to internet marketing and want to get some real valuable training… and for free… you couldn’t go wrong by trying the 30 Day Challenge. Each day, for thirty days, Ed Dale, via videos will explain how to get started, what actionable items you need to do for that day. Over the course of thirty days you’ll be grounded in the fundamentals. The information that Ed passes along could also be purchased for thousands of dollars from other sites, but there is no sense in that.

Goto www.thirtdaychallenge.com and get started.

Specifically here is the cut and dry of the ruling:

Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect. In contrast to the 1980 version of the Guides – which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as “results not typical” – the revised Guides no longer contain this safe harbor.

The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization. And a paid endorsement – like any other advertisement – is deceptive if it makes false or misleading claims.

For the full text of the press release goto http://ftc.gov/opa/2009/10/endortest.shtm

For the text of the Federal ruling (if you want to learn the specific ruling) click here for the pdf

http://ftc.gov/os/2009/10/091005endorsementguidesfnnotice.pdf

Image courtesy of: Clearly Ambiguous

On this Memorial Day, I can’t think of a better tribute:

JUST A COMMON SOLDIER
(A Soldier Died Today)
by A. Lawrence Vaincourt

He was getting old and paunchy and his hair was falling fast,
And he sat around the Legion, telling stories of the past.
Of a war that he had fought in and the deeds that he had done,
In his exploits with his buddies; they were heroes, every one.

And tho’ sometimes, to his neighbors, his tales became a joke,
All his Legion buddies listened, for they knew whereof he spoke.
But we’ll hear his tales no longer for old Bill has passed away,
And the world’s a little poorer, for a soldier died today.

He will not be mourned by many, just his children and his wife,
For he lived an ordinary and quite uneventful life.
Held a job and raised a family, quietly going his own way,
And the world won’t note his passing, though a soldier died today.

When politicians leave this earth, their bodies lie in state,
While thousands note their passing and proclaim that they were great.
Papers tell their whole life stories, from the time that they were young,
But the passing of a soldier goes unnoticed and unsung.

Is the greatest contribution to the welfare of our land
A guy who breaks his promises and cons his fellow man?
Or the ordinary fellow who, in times of war and strife,
Goes off to serve his Country and offers up his life?

A politician’s stipend and the style in which he lives
Are sometimes disproportionate to the service that he gives.
While the ordinary soldier, who offered up his all,
Is paid off with a medal and perhaps, a pension small.

It’s so easy to forget them for it was so long ago,
That the old Bills of our Country went to battle, but we know
It was not the politicians, with their compromise and ploys,
Who won for us the freedom that our Country now enjoys.

Should you find yourself in danger, with your enemies at hand,
Would you want a politician with his ever-shifting stand?
Or would you prefer a soldier, who has sworn to defend
His home, his kin and Country and would fight until the end?

He was just a common soldier and his ranks are growing thin,
But his presence should remind us we may need his like again.
For when countries are in conflict, then we find the soldier’s part
Is to clean up all the troubles that the politicians start.

If we cannot do him honor while he’s here to hear the praise,
Then at least let’s give him homage at the ending of his days.
Perhaps just a simple headline in a paper that would say,
Our Country is in mourning, for a soldier died today.

As I’m going down through the list of what to do and what not to do and comparing the articles, I’m struck with a polar opposite. One says don’t advertise, because Facebook is a social site, and ‘members can smell a sales pitch’. The other says buy advertising and pick your demographics and monitor your statistics.

So what does an agent do?

Well the simple answer is to advertise that you’re not advertising on Facebook. After all one expert says advertise, and the other expert says don’t. That way you’re taking the advise of both and covering your basis. Course I’m being flippant and that’s the point.

From a purely business standpoint, joining Facebook is a really smart long term strategy. From a personal standpoint it is a really great opportunity to connect with long lost friends and stay current with closer friends and acquaintances. After all not everyone is a professional salesman that has a thousand and one things to do. Some people are spending a lot of their free time connecting with others they know. Who knows how long Facebook will be ‘THE’ place to gather for social interaction? All I know is right now it is ‘THE’ place to connect with other like minded people and a place to discover people that have similar interests and hobbies.

So what about advertising on Facebook?

It’s easy to answer that one. You advertise. But not quite in the way I think either one elicited in their articles.

So if you wanted to buy advertising space what would you do? Create an ad that says “REALTOR® for hire” Call 999-999-9999. Probably not. I think that would probably be a waste of money. However, you could create an ad right now that says something like “The Facts on the $8000 Tax Credit.” (Granted that’s probably not the best headline in the world, but you should get the point.) That would be unobtrusive, would be glossed over by everyone that isn’t in the market or could care less, but just may catch the attention of someone who is curious about the tax credit money. The ad should take them to your website where you capture their name, email address, mailing address, and yes, even ask for their phone number, and then you’re autoresponder can automatically send them the report. It’s creative, it’s unobtrusive, it’s extends your brand and value and it creates another connection for you.

Other ways to advertise without advertising is to post industry figures, information about a neighborhood happening, you’re take on a new restaurant, etc. What you’re trying to do is show that you understand the neighborhoods in which you do business and you are the expert in your area when it comes to real estate. Not the blatant advertising that one author is referring to which would go something like this. “Now is a good time to buy a home, give me a call.” Yea, that’s pretty weak, and it does simply smell.

Oh, and yes, I would most definitely do one other thing. When you list a new home, I would put that information out there. That’s not blatant in your face, I want your business advertising. That’s just smart business.

With sites like Linked In, MySpace, Facebook and other social media sites, this one could prove to be a winner in helping you raise your ranking a little in the search engines. And it also makes it easier for you to be found.

The How To:

If you don’t have already have a google ‘gmail’ account, then you’ll need to get one. Goto mail.google.com and sign up for a free account. Currently gmail accounts offers 7gb of free storage space so you have ample space to store lots of email. Simply provide google with the information it requires, providing a valid email address and you should be setup within a matter of minutes.

Once you’ve created your gmail account, then goto http://profiles.google.com and follow the instructions. The more information you provide the better the chances you’ll show up at the bottom of page one when someone types in your name. Be sure to verify your email account, once you’ve entered in your information into your profile.

To see my profile Click Here

So invariably along with figuring out how to backup in case of disaster, getting hacked is a major issue for me. If you had a look at my server logs on several of my dedicated servers managing websites for hundreds of clients, you would see that literally every minute of every day, there is someone trying to get inside my systems. And if you’re on a shared hosting account, you are oblivious to this fact. So doing whatever you can to keep hackers at bay is well worth the time invested in securing up the fortress.

Step number one, should be when you create your wordpress blog, by default WordPress wants to name your tables with a wp_ in front of your name (something like wp_rickthomas), don’t do it. Change the wp_ to something dumb and make a note of it… like pp_ or qr_ or something that can’t easily be guessed based on the name of your site.

That’s step one. I’ll post more under hacking  and blogs as I have time and determine the best practices.

A New Search Engine Debuts

Wolfram Alpha is backed by Stephen Wolfram, the noted scientist and author behind the Mathematica computational software and the book, A New Kind Of Science. I don’t know much about the software but in my computer selling days, I sold this program by the truckloads to schools. So their just might be something to it.

You should bookmark this site now. http://www.wolframalpha.com/

Taken from their blog.

Although it’s tempting to think of Wolfram|Alpha as a place to look up facts, that’s only part of the story. The thing that truly sets Wolfram|Alpha apart is that it is able to do sophisticated computations for you, both pure computations involving numbers or formulas you enter, and computations applied automatically to data called up from its repositories.

Why does computation matter? Because computation is what turns generic information into specific answers.

To give an amusing example, every school child has at one time or another written a report on the moon, and they probably included the wrong figure for how far the moon is from the earth. Why wrong? Because the distance from the earth to the moon is not constant: it changes by as much as a mile a minute. If you ask Wolfram|Alpha the distance to the moon, it tells you not only the conventionally quoted average distance, but also the actual distance right now, which can at times be well over ten thousand miles off the average. The actual distance is a figure that can be arrived at only by computation based on the moon’s known orbital parameters. It’s rocket science, if you will.

“While search engines like Google, by and large, find things that already exist on the Internet—Web sites, photos, videos, blogs—Wolfram|Alpha answers questions, often by doing complex, and new computations.” —From The New York Times Bits blog
Looking for the gross domestic product of a country, say France? Wolfram Alpha’s got that:

Want to see the GDP of France?

Well, I for one am interested in seeing this in action.

An to appease the geek in me… here is a video showing the setup of some racks.

I like Donald Trump. Fortunately, or unfortunately, depending on your perspective, I don’t watch much TV so I’ve have to admit that I don’t watch The Apprentice. In fact the only time I ever watched was to tune into see Gene Simmons, and he got ‘You’re Fired’ the next show. He was pretty arrogant and off the mark for the show I watched, but in his world, he really was not arrogant, he was just being Gene Simmons. Shame because Simmons in my opinion is a business and marketing genius.

What does this have to do with advice for new real estate agents? We’ll first of all is a blog post on TrumpUniversity about the very subject of this post and to date the comments are pretty enlightening, and second based on my exposure offering real estate marketing products to agents, I’ve noticed some patterns. I’m sure I’ll explore it more and more on this blog, but for now this is a good place to start.

I’ll pose the question here and the Donald’s answer, and you can go to the post to read the comment.

I am really feeling at a loss as new agent in real estate. I have not been able to land one deal and am not sure if it’s me or what it is, for the most part. I don’t have the right people around, everyone claims they have already bought. Am I that late in the game?

Some specific points to consider are:
• Learn your area from the inside out. If you don’t know the neighborhood you’re trying to promote or sell, you are doing yourself and your clients no good. What businesses are doing well? Which aren’t? How are the schools? Playgrounds? Crime rate? The best grocery stores? Hardware stores? Restaurants? Parks? Transportation? What makes the neighborhood desirable? Undesirable? Be honest. Point out the negatives. Even desirable areas have what can be considered drawbacks. One neighborhood I know of was considered to be ‘hotel row’ even though it was apartment buildings because there were none of the typical amenities like grocery stores within a short distance. It didn’t provide anything that would make it seem like a neighborhood. To some people, that would be fine, to others, it wouldn’t. Clients are wary of a glowing report because it sounds too much like a sales pitch. Give an honest assessment. If you don’t live in the area yourself, talk to people who do.

• What kind of broker would you like to have? Be that kind of a broker.

• Build a list of potential buyers and sellers. Don’t try to sell them anything if they aren’t interested, but give thought to their needs anyway. If you can find out what people need and what they want, you will have some satisfied clients in the future.

• Interview electricians, plumbers, repair people, painters, landscapers, etc. Build a list of trusted vendors. Then offer to connect them to potential customers. You are building a network that will benefit everyone.

When we started offering web sites and property search functionality for agents and brokers (see MLSSoftware.com) in 1991, I thought we were stepping into a world where I could relate. Being a life long salesman, I thought this was great. I’ll get to talk to real salesman all day long, and it will be a no-brainer to sell my products, after all, you may have heard the old adage, “It’s easy for one salesman, to sell another salesman.” Wow, I couldn’t have started this subsidiary at any stranger of a time.

According to statistics from NAR, The National Association of REALTORS, there was approximately 750,000 agents nationwide in 2002. I believe it was in 2007 that number had mushroomed to over 1.2 million agents. Obviously with money flowing like a wide open faucet, everybody and their brother thought they could be a real estate agent. Indeed, the barrier to entry was not and still isn’t that hard. You take some classes, learn the legal requirements to sell a home, pass a test, and voila, you’re a real estate agent. Since the melt-down in the past couple of years, I think that number has settled back down to roughly the 750,000 agents before the boom.

The vast swelling of agents that came on the market, knew little if anything at all about sales, marketing, or even how to talk to another human being they did not previously know. The answer given is a very good guideline to stop and take a look at the basics. When we prepare websites for agents, in some cases, we can’t even get them to tell us anything about the area in which they work.

So what is Donald saying?

1.) Put together or update your list of everyone you know. That includes everyone in your immediate and extended family, the people at your church, the organizations and clubs you belong to. Put together a mailing list, email list, and phone number list of everyone you can think of.

2.) Put together a list of everyone in business that you come into contact with, the lawyer, the title company, every mortgage person out there, the plumbers, electricians, doctors, etc. Take them all out to lunch, and ask how you can help them get business. That’s right, don’t waste your money on expense newspaper advertising, or buying the next new shiny thing. A $1000 investments in lunches in the next 90 days will pay off handsomely in the long run. Zig Ziglar said it best, “You can get everything you want in life, if you’ll just help enough other people get what they want.”

3.) Systematically start calling everyone on your list. Put together a monthly newsletter and send it out. It can be as little as one page. The newsletter doesn’t have to be about real estate, per se. The monthly newsletter should however, I think, be about things to know about owning a home and depending on the time of the year,  tidbits about the season. If it’s August, you should have back to school information. If it’s March, you should be giving them information on spring cleaning, or getting a garden ready, etc.

4.) Tell everyone you know about the benefits of the $8,000 down payment assistance. It just may push those who are a little timid to even think about buying a home, realize that it’s not all doom and gloom out there and that they might be able to actually purchase a home today.

5.) Start discovering social media on the web. Join Facebook, Linked In, etc. If you want help with this area just let me know.

I’ll never forget the first few months in this business. I was working with a close friend who had been a real estate agent for over 15 years, and who the previous year sold more homes than any other agent in our area. He wanted to impress me, so I was invited to listen in on a conversation he was going to have with a prospect from California about relocating to our area. BTW, a lead he got from the website I put together for him. He spoke on the phone with him for a little while, mostly small talk, and told him he would send him a relocation packet. When we got off the phone, he mentioned to me, he thought this person was a good prospect, then he said something I’ll never forget, he said, “I just wonder how I’m going to keep track of him for the next year.” I was floored. A lot of rookies don’t look at their career as long term and forget to put systems in place to keep in contact with everyone they know. Big mistake not to have a system in place to keep track of prospects.

Let everyone you know, you’re in the real estate business, and you’re job is to help people find the home of their dreams. Become the expert that everyone seeks out when it comes to knowing what’s going on in your neighborhood. And don’t give up on someone you know or meet, keep in contact with them, via e-mail, a personal call just to check in every now and again.

Will this advice lead to a sale today? Maybe, maybe not. Pick up every book you can about selling real estate, on sales in general, on marketing. Start to think long term. Sure you have to work hard and give your new occupation a lot of thought and you need sales today. But don’t forget that if you survive the first year, you’ll need to survive year two, and year five and year twenty.