I wanted to follow up on this briefly because it’s inspired a great deal of debate among Insider’s Edge readers.
As you’ll know from my last article on this I do not recommend investing in this programme – you can see why here.
I received a flurry of comments and emails soon after posting this. There were some constructive debates, some angry rants and some great links to new information (which is the main reason for this follow up).
Now I made my points clear in the first article so I’ll try not to cover too much old ground. As I said the main purpose of this article is to point you towards some further reading on this. However, there were a couple of issues concerning Banners Broker I’d like to quickly raise before I close my own thoughts on this.
Why have these major advertisers never heard of Banners Broker? Who is using them?
It would take months to unravel the opaque language used to describe the Banners Broker business model… but from what I can determine (in simple terms) their pitch is effectively this:
Banners Broker acts as brokers between advertisers and publishers.
The implication is that the majority of the revenue is derived in this way and not from new signups and referrals (the latter being the ‘ponzi scheme’ argument).
As you know my number one concern has always been “where are the ads?” Specifically a) who’s buying them? and b) where are they appearing online?
It says on the Banners Broker website:
“Our globally renowned network matches your ads with the most suitable publishing sites”
Hours of research has led me to nothing that proves or suggests any major advertisers (or small advertisers for that matter) are using this – and I’ve not just been aimlessly Googling either.
I’ve worked in publishing for several years and a number of my friends/ex colleagues work in the advertising industry. They’re not just tea boys, some of them are account managers and account directors now. I asked them the following:
a) What advertising brokers have you used? and b) Have you ever heard of Banner’s Broker?
They could all name half a dozen advertising channels and brokers off the top of their head. Google AdWords was always one, Adblade was usually another… then there was AdBrite, Bidvertiser, Chitika and various others depending on who you asked.
What every single client had in common (and I’m talking about people working on major accounts like Nike, Orange, O2, Bauer Media and so on) was that they had never heard of Banners Broker.
How is that possible? Some of these companies have budgets that stretch to tens of millions, even hundreds of millions of pounds a year.
It’s not just people like you and I who can’t find evidence for these ads – if major advertisers have never heard of them where’s all this money coming from?
Is it possible that Banners Broker uses a ‘Blind Network’?
The argument used to refute the above is that Banners Broker say they use a ‘Blind Network’ – so in other words we wouldn’t see the ads they serve.
Here’s how it works according to their own diagram:
I should point out that some Blind Networks do exist in advertising… but I would expect to see Bacon Airways launch daily flights to the moon before I could remotely believe that Banners Broker are making their money this way.
When people very first started to cry ‘foul play’ about Banners Broker (and asked where ad banners were appearing) the company revealed a bunch of extremely poorly created websites suspiciously all hosted on the same server displaying ads. These were kind of websites that no-one in the world would ever want to advertise on.
Almost no one was convinced and now they seem to be playing this brilliant ‘Blind Network’ card. It’s quite ingenious because even saying the words ‘Blind Network’ seemingly shuts down any argument. Why can’t I see the ads? “Ahhh, because they’re on the ‘blind’ network.”
I see. Or rather I don’t see.
I showed the same advertising guys and girls this diagram and asked them whether they thought Banners Broker, this company they’d never heard off, was operating through the kind of Blind Network they describe and pulling in this kind of revenue. They laughed. Lots.
A ‘raid’ in the Indian office… and an invite to Canada
After last week’s article an Insider’s Edge reader pointed out that the Banners Brokers office in India was recently raided and shut down.
This was the notice put up by Banners Broker:
This can’t be a good.
Whether or not the offices were ‘raided’ or closed down (and there seems to be a riveting debate about the terminology online) is largely irrelevant. The official line is that some of the affiliates and ex-employees explained the compensation plan of Banners Broker wrong and broken the ‘very strict Policies and Procedures of Banners Broker.’
If some employees and affiliates (and by extension in this case the authorities) can’t get their heads round the Banners Broker business model what hope does anyone else have?
The problem is whenever I read anything about Banners Broker in forums and blogs the general response to critiquing seems to be this…
“You’re missing the point”, or “you’re misunderstanding the model.”
But what is the point?
Either Banners Broker is a broker for advertisers and publishers or it isn’t? Either there are ads or there aren’t? I simply do not buy the ‘Blind Network’ line AT ALL and nor do many folk who are considerably wiser and more experienced than myself in this field.
While there’s plenty of evidence to show that members pump new money in and that many are profiting from referrals on Banners Broker… there’s nothing to show the revenue from the brokerage side. A lot of Banners Brokers wheel out the same old argument: “But I’m making money and I haven’t referred anyone! Therefore it CAN’T be a Ponzi”. That simply doesn’t wash I’m afraid. You still have to invest when you join. In a Ponzi scheme money can still come in as long as new members are coming in.
Recently there’s been a big PR drive and the top brass at Banners Broker have invited a number of people to come to their head office in Canada.
Even I was invited, I think, via the comments thread by Terry Stern who’s spearheading this new PR campaign.
Terry, in fairness, seems to be a decent enough guy and has been responding to a lot of questions posted on other sites in a level headed manner.
I should say that I’ve not been convinced by any of the answers given – but hey, at least he’s initiating a dialogue which is positive. Finch, a blogger who’s written an excellent run-down on Banners Broker (I link to him below) has accepted this invitation and will be checking it out the head office in March when he moves to the States – this should be an interesting report.
I’m going to leave my own foray into the world of Banners Broker here. My own opinion is that logically, intuitively and on the basis of every piece of evidence I’ve seen, this is something that should not be touched. If you do have money locked in here my advice would be to withdraw it as soon as you can.
Banners Broker in the media and further reading…
The best investigation I’ve seen into Banners Broker by a killer mile is from this guy (thanks to one of my readers for pointing me in his direction). I’m linking to all three of his posts because they are extremely well written and well reasoned:
The media have also taken a look at this…
The Mirror: Banners Broker Accused of Being a Ponzi Scheme
Irish Examiner: Advertising Scheme Boss Led Firm Suspended for Pyramid Selling
Irish Examiner: Another Scheme Too Good to be True?
Sunday World: Broker in the Pack