Over the last few weeks I have been reviewing the stories of many NY Affiliates. In reaction to the NY Affiliate Tax, hundreds of merchants terminated NY Affiliates. The merchant terminations of NY affiliates had devastating effects on the businesses of thousands of NY affiliates. Hearing the stories of its impact is extremely tough. Many NY Affiliates have struggled but fortunately, many have managed to adapt. Though income is recovering, it will take some time for a NY affiliate’s business to return to where it had been. It will take even longer to recover from the emotional damage. The emotions that are shared as I talk with other NY Affiliates shows the far reaching impact of the NY Internet Tax and the merchant termination of NY affiliates.
Herb is an older affiliate from NY and has also agreed to share his story. I first met Herb in Albany, the night before our July 28 meeting. After dinner Sunday night, as we all sat around in Starbucks talking, I was struck by the variety of people who had come together. All ages, all interests, all different business models and all with different reasons for being in the affiliate business but one thing was common; we all needed the income from our affiliate business. As we sat in Starbucks we talked about everything except the NY Tax issue and got to know one another.
Like most of us, Herb and his wife had traveled a few hours to attend the meeting, proving his business is important to him. Herb was hit hard by merchant terminations, having lost forty or so merchants. Unfortunately, the merchants’ termination of NY Affiliates because of the NY Internet Tax was right on top of a major collectibles merchant ceasing their affiliate program. Combined, the two events created huge holes in Herb’s sites. Herb explained, “I had not recovered from losing a major collectibles merchant who stopped using affiliates when the end of May arrived. I never take sites offline so you can imagine the holes to be filled!”
Herb went on to say that while it is of course possible to replace merchants, it does take time. Until replacements were found and new merchants added, his sites had numerous holes. These holes in his websites had a negative impact in the eyes of search engines and as Herb said, it takes a while to recover. His income dropped immediately with the merchant terminations of NY Affiliates and his sales are still down. “If sales from last year were an indication, I would have had a decent 3rd quarter but it is just starting to pick up now in November.” said Herb.
Herb continued, “I’ve managed to replace most of the merchants who dropped me. But it took a while and the search engines took notice, sending less visitors. There are only a few merchants I would welcome back.”
Like many of us, he wonders why so many merchants have yet to act and reinstate NY affiliates. The initial reasoning of merchants was that they did not have enough time to find or implement a solution. Now five or six months later many have not acted. “I lost about 40 merchants and frankly, I’m disgusted with them. Whether they were apologetic or not, they should have done their homework. Five months have passed since the May 31st deadline. It takes that long to consult with their lawyers?” said Herb.
Like other NY Affiliates, Herb has moved on although he continues to help with the NY issue, keeping me and others informed as he hears from merchants. He has found several new quality merchants, formed new relationships and business is picking up. He is optimistic about being able to recover completely but he is realistic, knowing it will take time.
The scars from the events of May and June however, remain, for Herb and every other Affiliate from New York. The scar is not just from the financial losses we suffered. We, perhaps more so than any other affiliates, are very aware of what the future may hold. We diversify a bit more, are a bit more cautious about the business relationships we form and perhaps, sadly, we have a little less faith in the term “valued partner”.
I can honestly say that some good things happened as a result of the NY Affiliate Tax. The bright moments over the last seven months includes having met many wonderful people and forming several new friendships. I will always have a special fondness for all those who attended the meeting in Albany. I hope they all know the strength and faith I gained from each of them. I wish Herb much success and happiness as he continues to rebound from the NY Affiliate Tax fiasco.