Clickbooth: Exciting FTC Announcment

Dear Clickbooth Partners,

As 2012 is drawing to a close, all I can say is…

WOW. What a Year!

Its been a year of achievements for us and all of our partners! It’s now officially been 10 years since I founded IntegraClick, in what would become Clickbooth, from a one bedroom apartment that was so small I couldn’t fit a computer chair in front of my desk – I had to sit on my bed to type.

On the other hand, it has been a year of distraction and controversy.  As some of you may already know, Clickbooth, as part of an affiliate network targeted sweep by regulators, was contacted last December by the FTC.

This was nothing new…

As the market leader in any emerging industry, we have had to interact with regulators for many years, and honestly we have had great dialogue with many of them. Our goal in communicating with them has always been simple – to turn the opportunity of an open dialogue with them into standards for the industry.  Standards that would protect you, our publishers and advertisers and, as a result of giving you the information you need, protect consumers as well. We have spent millions of dollars over the years researching and enacting compliance standards and enforcing these standards for that sole purpose.

Over the last few months we began to realize this inquiry was different…

It became clear that without a unified industry self regulation program the FTC was going to litigate with each and every network individually till one was made, and at this point we figured out we were another network on that list.

We began to realize that even though we have had, and currently have, over 100,000 partners, they were most concerned about just a handful of weight loss advertisers and Advertorial Affiliates from 3 years ago.  These were advertisers and publishers in many cases that our compliance team had proactively shutdown from our network.  This handful of advertisers and affiliates accounted for a very small percentage of our traffic over the years and even though we had never been an advertiser or publisher ourselves like other “networks”, they wanted to hold us responsible.

At this point we were at a crossroads and had two options:
1. Litigate the question of how an ad network should be regulated, which would take many years and would cost many millions of dollars with no guarantee of success no matter how strong of a case we feel we had.

-or-
2. Negotiate a settlement that would protect our current advertisers and affiliates and create more clarity for all networks.

This decision was a tough one, we knew we could not and would not agree to the terms that other networks have agreed to in the past. However, we knew coming to a settlement under the right agreement would be the best option for all of our partners and the industry as a whole.

I am proud to say that we came to an agreement that we are very excited about.   We voluntarily agreed to pay more; in the coming weeks the FTC will announce a settlement of $2 million dollars.

We agreed on this as a much larger network and in order to get better agreement terms, terms that we worked on with both the State of Florida’s Attorney General and the FTC.  As some of you may know, State Attorney Generals typically work in concert with Federal regulators when working with a company in a particular state.  We know these terms will help protect our affiliates and advertisers in the end and will create more guidance for other networks in the industry.

I am sure you have some questions so here is my best quick Q and A session:

OMG! Am I going to get paid? Is the Clickbooth ship sinking?
Of course you will be paid, Clickbooth voluntarily agreed to this. We have not missed a single payment in over 10 years and we won’t miss a single payment over the next 10 years and beyond. We’ve had this money set aside and outside of cash flow for occasions such as this. As the market leader we understand that we need to be prepared for anything – that is why you do business with us.

What does this mean for Clickbooth’s future?
Clickbooth’s business is well diversified not only across every area of our CPA and CPC networks but we’re also established leaders in all major verticals (automotive, beauty, dating, financial, nutra, etc.) and we believe we’re working with partners who have the consumers’ best interests in mind. Having this agreement and industry standards in place will only help to accelerate our growth and ability to provide great offers for our publishers and quality traffic for our advertisers.

What does this mean for Clickbooth’s compliance requirements?
Many of the changes have already been implemented over this past year and we will continue expanding on these most notably in the weight loss and publisher lander arenas.  Some things we have been implementing for many years but just not in an organized or comprehensive fashion that created clarity internally and for our partners.  So, the good news is that as a result of these guidelines, much of the guesswork is and will be eliminated and we can implement a rational compliance program for our network that will help both us and our partners to be able to get back to business.

Finally, I am most excited moving forward about getting back to business.
This year has been marked by some of the strongest growth our company has ever seen.  Between our CPA and CPC network, according to Quantcast, we now reach more Unique US households than Facebook.  Simply put, Clickbooth has been generating more traffic than ever before and we are excited to continue building upon this.

Do you have a copy of the complaint and stipulated order?
I sure do – here you go for all of your viewing – prior to it becoming public:
Complaint Filed
Stipulated Order

As always please let me or anyone on the team know if you need anything – our doors are always open and I personally wanted to make sure you and all of our valued partners received this.

 

John Lemp
CEO/Founder – Clickbooth


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Comments

  1. Eric says:

    I think it is a good move as a lawsuit with FTC, FCC, or anything Federal is extremely costly. It is good to put that chapter behind them and focus on what they do best – marketing, not legal defense.

  2. Glad to see you were proactive in protecting your clients. Other networks have bowed down to the FTC and given in to their demands when it comes to advertorials and the weight loss space. Its good to see at least one network standing up for the industry and market as a whole.

  3. Steve says:

    Congrats! Glad to see you can put this behind you and move forward. Good luck

  4. James says:

    Wow. I guess I’m not surprised since it seems like a lot of companies are dealing with similar issues with regulators, but I appreciate your honesty. The other networks can learn from their response to this.

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