WARNING: Today’s post is going to rattle cages and put a spotlight on a potentially dark side of Internet marketing. Yeah, I’m probably going to tick some people off. That’s life. I’m more concerned with speaking the truth.

This is #2 in a series called The Truth About Internet Marketing. Part one was called “The Long Form Sales Letter.

For some time it has been suspected that there is a “secret cabal” of Internet marketers who seek to do nothing more than drain money from unsuspecting customers who will buy their stuff. This group is accused of interacting with each other in a way that would exclude others from their circle.

Having written my first ebook in 2005 and having enjoyed a certain degree of success in the information marketing space, I believe I can honestly and openly speak to what I have observed.

First of all it is important to note that Internet marketing is a term we use to describe the people who sell training materials, software tools, templates, private label rights and other products related more directly to the “make money online” space.

My ebook on making money with AdSense falls into this category.

However, Internet marketing is really a method of marketing any kind of product or service on the Internet. So perhaps a more appropriate term would be infoproduct marketing. (Even that is not completely accurate as there are thousands of infoproducts that have absolutely nothing to do with the “make money online” space.)

So is there a secret group that exists to create products and sell them to people at exhorbitant prices knowing that others can not succeed with these products?

No, there isn’t.

But is there a group of marketers who have built relationships with each other over the years that tend to work together on projects?

Of course. People tend to befriend others with common interests. It’s just human nature.

But here’s the problem.

Just like any other group of people it is easy to lump everyone together and stick a label on them.

For example, all politicians are crooks. Is that really true? I’m sure there are some reputable, ethical politicians working on our behalf. (Just don’t ask me to name one…)

How about, all lawyers are scumbags. True, there are scumbag ambulance-chasing attorneys out there, but I have met some very nice ethical lawyers in my time.

The point is that we have to be very careful in lumping people together.

We are all individuals.

I didn’t set out to network with people in “the circle.” It just happened when I wrote an ebook that people wanted to buy. When it became a hit people naturally gravitated towards me. After all, success attracts the interest of others. (That’s the REAL law of attraction… not that mumbo-jumbo “the universe is your genie” crap.)

Others desperately want IN the so-called circle because they believe having relationships with other successful people will be the key to their success. I get emails all the time asking me to promote other people’s products because, and I kid you not, “I have a big list.” Gee, that’s a way to win someone over…

It’s important to understand that there ARE great products out there that bring value. I wouldn’t have sold thousands of copies of my AdSense ebooks if they didn’t bring value. Word of mouth and legitimate testimonials go a long way. I have always attempted to create products that bring value and will always continue to do so.

That doesn’t mean that you can’t make a lot of money with a worthless product, though. I’ve seen it happen time and again. All it takes is a carefully crafted sales letter, a well thought-out product launch strategy and a group of affiliates who will promote it on launch day for a commission.

I believe it is morally wrong to sell products that don’t bring real value. If you are going to provide training, make sure the training is valid. If you are going to sell a software product, the software needs to do what you say it does.

There is, however, nothing evil or even unethical about crafting a good sales letter, preparing a launch strategy and recruiting affiliates to promote your product.. As I’ve discussed before, it is important to write a persuasive sales letter (as long as persuasion doesn’t become manipulation.) It is essential to have a product launch strategy. And affiliate marketing is nothing new. It’s critical that others are eager to share your product or service with their members. New FTC regulations require that affiliates are forthcoming with their relationship with the product they are promoting, but there’s nothing wrong with doing a promotion.

So where is the problem?

Well, there actually is a series of problems that I have observed over the years. I’m not going to name any names because that’s not the purpose of this post. The point is to make you aware of what is broken in the industry. It’s then up to you to find out who the people are that have made it this way. Hopefully, you’ll also be able to discern who the good guys are.

With that said, these are three areas that I find disturbing in the Internet marketing space.

1) Back-scratching.

I understand the “if you promote this for me I’ll promote that for you” mentality. I have encountered it all too often.

In the earlier days of Internet marketing, many of the products were fresh and original. Entrepreneurs were coming up with great solutions and many of them worked quite well.

Things have changed. With so many people in the “make money online” space, many are creating products just to enter the niche. As I’ve written before, a number of them have no credibility and some of them outright copy others to make a buck.

Now there’s nothing wrong with asking for reciprocation, but I have a problem endorsing something I don’t think will serve the customer. Over the years I’ve presented numerous products and services. I’ve only regretted endorsing a small handful because I turn away from promoting MANY offers that I don’t believe bring real value.

That’s not the case with everyone.

I’ve seen some Internet marketers promote everything and anything that comes their way, all in the name of reciprocation.

I can’t do it and I won’t do it just to do it. I will only reciprocally promote an offer if I believe it is worthy to promote.

2) Unhealthy attitudes towards customers

This one may make you angry and it probably should.

I have spoken at a number of Internet marketing, online business and personal development conferences. I will go more in depth on these events in another entry, but for now I want to focus on an experience that I had.

I was at an event a couple years ago and was accompanied by one of my employees.

The event was such that the people attending paid very little to be there. The speakers were to deliver quality content and end their presentation with an opportunity for the attendees to purchase their product or service.

There is nothing wrong with this model. It allows people to learn something new and consider if they want to learn more. It allows speakers an opportunity to get in front of an audience and present valuable content. Of course, it also allows the speaker to sell his or her product.

Anyhow, at this one particular conference I was outside the room with my associate. We were speaking to the promoter of the event and asked him how things were going in the room. That kind of question means “how is the content and are people investing in product.” In order for a conference like this to be a win/win for all both need to occur.

My associate and I were stunned when the promoter told us that the attendees to his event were always looking for the next big thing and that it was like he was selling crack to them… providing their next fix. He made it clear that he didn’t expect them ever to make any money and he was fine with that.

I couldn’t believe what I was hearing. I lost a lot of respect for this person that day.

This attitude can be found in spots throughout the Internet marketing space. I’m not saying it is everywhere. It is rare. But it does exist.

3) Bonus offers to make more sales as an affiliate

It is common for marketers to have affiliates compete to see who can make the most sales during their product launch. They will frequently rank the affiliates each day so everyone can see who is winning and prizes will be awarded based on final standings.

I think healthy competition is a good thing and I see nothing wrong with having a sales contest. Corporations have contests among their sales teams all the time. I’ve offered prizes to affiliates in the past. It provides them with incentive to promote my product.

But I draw the line at affiliate bonus offers.

The merchant selling the product will ask affiliates to provide a bonus for customers who purchase their product through the affiliates link. The idea is that more people will buy through my affiliate link if I offer them an attractive bonus, thereby earning me more affiliate commissions.

I think I did this for another marketer’s promotion one time, several years ago. I gave away a free copy of one of my ebooks for customers who purchased through my link.

But many marketers will offer bonuses with high perceived value. I’ve seen people give away their high-end products to incentivize customers to purchase through their link.

I have found this puzzling because some people are willing to completely devalue their own products in order to make more sales of someone else’s product.

I have refused to play this game.

Essentially, it means that when I promote a product I feel adds value and choose not to add a bonus I will make fewer sales. After all, if a customer can purchase through Affiliates X’s link and get two-thousand dollars worth of bonuses, why would they purchase through my link?

And I’m ok with that.

I’m not going to devalue my own product in promotion of someone else’s. It doesn’t make any sense to me.

I’ve got more to say about Internet marketing and will be posting another entry shortly.

I want to conclude on an up-note.

There is hope that the industry is changing.

New FTC regulations attempting to reel in fake and unreasonable testimonials as well as a crackdown in the merchant services sector are forcing marketers to take a long hard look at what they are dong.

I believe this is going to serve to weed out more of the scam artists and provide opportunity for those willing and eager to do business the right way.

Assuming you have an idea for a product or service of value, I would encourage you to see it through and bring your dream to fruition.

So what are your thoughts on the topic? I’d love to hear your comments below.