Webtresting

Review of Affiliate Junktion:
http://www.affiliatejunktion.com

 

I had been seeing this site for last couple of months willingly or unwillingly. I first landed on this site around 6 months back, and didn’t join, because it looked like a money-chain/pyramid scheme. But during the last three month I have landed on this site a bit too many times via its referrers through Google advertisements. That made me a bit curious, and I went hunting and digging more about it. Now, as I have completed my research, its time to expose Affiliate Junktion and Mr Michael Davies’ scheme.

 

History of the domain affiliatejunktion.com

 

Domain Created on: 11th September, 2007
Registration Expires on: 11th September, 2008
Source: http://who.is/whois-com/ip-address/affiliatejunktion.com

 

Strategy used by Affiliate Junktion

 

1. You signup on their site.
2. They send you a mail asking you to purchase 12 months web hosting either on Omnis Network, or iPower web hosting only.
3. They promise to pay you back your hosting expenses(that makes it sound risk free, isn’t it?)
4. They send you a pre-designed webpage to host on your newly purchased web hosting account. The webpage has an affiliate link to the Affiliate Junktion website.
5. Then you promote your affiliate webpage using google adwords or yahoo. The web hosting account that you purchased provides a free google and yahoo advertisement credits that may help you advertise your website for some time.
6. When new members join through your webpage, Affiliate Junktion pays you $2 for each sale.
7. The new affiliate follows step 1 to 6, and the cycle continues.

How does Affiliate Junktion make money?

 

It makes money from the web hosts. Yes, from Omnis Network and Ipower. Sometimes web hosts pay more than the sales amount to the referrers, because they expect that the customers will stay with them and keep paying them again and again. For example, Ipower pays $100 for each 1 year sale, and Omnis pays $75. Thats valid in normal case. In case you are able to make large number of sales, they are ready to pay you more per sale. So now you getting it? From where does Affiliate Junktion pays your hosting charges?

 

How much money does Affiliate Junktion make?

 

Although according to Ipower, they are willing to pay more than $100, let us assume that they pay only $100.

 

1. Ipower pays Affiliate Junktion $100 for each new sale.
2. Affiliate Junktion pays back $75 to the new affiliate.
3. Affiliate Junktion pays $2 to the one who referred the new member.
4. Assuming that other expenses are $2 per sale, remaining $20 goes straight to the pocket of Mr Davies(the CEO of Affiliate Junktion)

So ever time an affiliate earns a dollar, Mr Davies earns $10. So how much does that make Mr Davies per month? Assuming that the figures on their site is true, the sum total of the top five earners for the month of Februry 2008 is $70,668. That should make Mr Davies somewhere around $706680. If we take in to account the income of others in the network, then his monthly income should top over a million USD.

 

If the figures on his website is true he should be paying out a good amount in tax, isn’t it? And if they are not paying that mone, then they are basically lying on their website. But hey, but what if he isn’t paying the tax out of that huge sum of money? Can he be caught? Let us help the income tax department in investigating.

 

Is Affiliate Junktion a legitimate business?

 

So Mr Davies’ address is: Trafalgar Street, P.O. Box 1228, Nelson 7010, New Zealand (Phone: 021 294 2308). But hey, here is a complain about something similar to Affiliate Junktion:
http://www.ripoffreport.com/reports/0/249/RipOff0249316.htm

 

But is www.affiliate-inc.com the same company? The web archive of affiliate-inc.com tell that this company too was based at Nelson, New Zealand. And they had exactly the same phone number as Affiliate Junktion.

 

So is Affiliate Junktion ethical? Is it even legal? Are they paying the tax for the millions they claim to be earning?

 

Can you really make those handsome bucks by joining Affiliate Junktion?

 

May be you can. But probably I won’t be able to. I will tell you why. The web hosting company would give me a credit of around $50 to advertise on google. This may help me promote my referral website for a few days. After that I will have to pay for the ads from my $2 per lead pocket. Mr Davies, who earns $20 per lead won’t have to spend a penny from his pocket.

 

Moreover, everytime I refer someone to Affiliate Junktion, basically I am increasing the number of my competitors. They too will be running ads on google for similar key words. That means over a period of time everyone will have to pay a higher revenue for the campaign. The number of people interested in joining the network will keep reducing. But the number of people willing to refer them will keep on increasing. That means my high paid advertisement campaigns won’t return me as I expect.

 

The what do I have to do? I will have to look for alternative ways to promote. And thats basically becoming a sales man on the internet. I think I have a better options than making Mr Davies richer by struggling day in and day out.

 

But still, atleast I will get a free year of hosting, won’t I?

 

Yes, certainly. But I forgot to mention one thing. Affiliate Junktion wont pay you the $75 until your total commission ammount reaches $150. So basically you will have to search either for around 37 victims, who will earn you $2 each, making you another $75 or for minimum payout amount. Each of those victims will have to search for 37 victims each., and it goes on in a geometric progression. This isn’t different from any other money-chain or pyramid schemes. Such systems typically thrives on the bottom line victims, who are destined to be ultimately cheated.

 

But hey, its still a fresh idea. People are falling for it. If you enter early, you will be able to make some bucks. It is yet to be declared illegal by law. If what matters to you is money, take some risk, forget ethics, and plunge in.

 

No? You won’t do that? Ok, so lets look for something else.