Well, of course, he is.

In case you don’t know, Salty Droid is a persona created by Jason Jones to expose some of the frauds and scams that are happening in the Internet marketing space.

I happen to agree with what he’s doing, which is why I’ve linked to his site and quoted him on this blog before. (Those posts, by the way, are some of the most popular posts I’ve ever published.)

The purpose of today’s post is to let you know about an interview Jason did with Aaron Wall, the owner of SEO Book. The interview is an hour long. You can read the transcript or listen to the MP3. (I personally chose to read the transcript.)

If you like Salty Droid, you’ll probably want to check out the interview. And if you don’t understand Salty Droid or why he uses satire to skewer gurus, then you’ll still probably want to check out the interview.

Here’s the link:

• Jason Jones Interview: Salty Droid Uncut

-Ryan M. HealySimilar Posts:

• Ken McCarthy More Dangerous Than Salty Droid?
• How to Work with Clients without Going Crazy
• Business Interviews Galore!
• A Little Direct Response Gold
• An Inside Peek at Product Creation

Yesterday, I did a 1-hour interview with John Breese.

Our primary purpose was to discuss product creation, and we did that. But we also discussed productivity, copywriting, the state of Internet marketing, even John Wilkes Booth.

The interview is free — and there’s nothing for sale. You can download it here:

• How to Create a Product Every Month

-Ryan M. HealySimilar Posts:

• Is Salty Droid Even Human?
• Ben Settle’s Weird Copywriting Tips – Free PDF Download
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• A Classic Today, Rare Book Tomorrow
• A Little Direct Response Gold

Mike Dolpies is an expert at using local PR to grow businesses of all kinds. And to promote his new program — The 7 Day Local Celebrity Course — he agreed to do an interview about local PR and how he’s used it to get new clients and customers. Enjoy!

1. What first made you interested in PR as a business growth strategy?

I started my first business when I was 18 years old. After a couple of years “putzing around” I got serious. I was always fascinated (and somewhat jealous) when I saw or heard another local business owner or even some virtually unknown author being interviewed on TV or the radio or written about in the newspaper. Not knowing much I chalked it up to what I thought was “luck.”

Then, I ran into a DVD that featured Paul Hartunian. He’s the guy who sold the Brooklyn Bridge in 1983. And he is sorta known as a Publicity Guru. He really opened my eyes to what publicity could do for just about any business owner. Then I found more mentors. And don’t get me wrong — all of the information I got from them was great — but for me — there was still a missing piece. For some reason I could not get it to work exactly like the courses taught.

2. Why is it so important to pursue a local PR strategy at first?

It’s funny because one of the flaws I discovered was trying to “aim for the stars” without first hitting the moon. What I mean is — if you want to get national publicity. I am not talking “flash in the pan” one-and-done type stuff — I mean sustainable — you must prove yourself locally first.

The good news is we are all “local.” Even though a lot of us can sell things and speak and do coaching all over, we all live somewhere. And where we live there is a local media market. Some markets are really huge too!

The good news is getting local PR (when you do it right) can be a heck of a lot easier. Then, that momentum can actually make getting national publicity easier. I’ll give you an example.

My core business is internet marketing for local business owners. I’ve been doing it for a while because I started as a local business owner. Anyway, I write internet marketing articles for a state business publication. Well those articles (about 2 that I’ve seen) have found their way to Entrepreneur.com. I didn’t even pitch them — it just went syndicated and now — “I’ve been seen on a major national website.”

Lastly — you can really “seal up” your local market by getting local PR first. You may not even care to do anything else because the local PR can keep you busy.

3. Can you think of any businesses where local PR would NOT be beneficial to them?

Really, NO! The truth is any business can really benefit. Again we are all local. Some more than others, but we have to live somewhere!

4. What inspired you to create the 7 Day Local Celebrity Course? And how will it help service providers like coaches, copywriters, and marketing consultants?

Actually the inspiration came from a Mastermind group I am in. I kept sending them the videos of TV appearances and article clippings. Finally they said “you should do a course on this,” so I did.

The hardest job any consultant, copywriter or coach has to do is actually make people believe they are qualified to help. A lot of prospects are skeptical of your claims about improving their life or business. There’s this “why should I listen to you?” thing.

But when you get publicity it’s a game changer — you’re not just someone marketing to them because now you’ve been “endorsed” by the TV program, Radio show or Newspaper you appeared in. It just makes selling so much easier.

5. How well have your PR strategies worked in your own business?

It has opened so many doors! As far as numbers go, I have one client who has paid me more than $20,000 over the course of 3 years and he came from a magazine article I wrote. Just last week someone contacted me after reading an article in a very small local newspaper and he became a client. There are countless examples.

One way to measure its success too is to think about how much, the air-time or space in the publication would have cost if you were advertising. For that I’m easily up 6 figures. Again, it also really takes the edge off selling.

6. Would you be willing to “give away” a helpful PR tip that my readers can use even if they don’t get your course?

Sure thing…

I’d say to be sure you add Local PR to your list of how you want to market your business. Then learn to “Speak the Language of The Media” — which is explained in detail in my 7 Day Local Celebrity Course.

Obviously, since I don’t know the specifics of your business, this course may or may not be appropriate for you right now.

But if you’re a local service provider — for instance, a chiropractor, real estate agent, mortgage broker, web designer, marketing consultant, etc. — then Mike’s course could be a huge help to you.

Or if you serve a national client base and feel you could benefit from the increased credibility that local press could give you, then I recommend you check out The 7 Day Local Celebrity Course. (Just look at how many newspaper articles and media appearances Mike has gotten… amazing!)

And full disclosure… the links above are my affiliate links. If you try Mike’s course, I’ll get a commission. That said, the course is solid. I’ve already gotten some great ideas I plan to use myself. :-)

-Ryan M. HealySimilar Posts:

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So far, we’ve gotten an insider’s view of a phone consultation between two high-profile Internet marketers. And we’ve caught wind of other anticompetitive practices that may or may not be going on inside the Internet marketing space. But has anybody actually done anything wrong?

Here’s a great comment Antone Roundy made here on this blog that sheds light on this question:

Up to a point, what these guys are doing is just smart business: build industry connections, promote each others’ stuff, time your product releases so that they don’t drown each other out (not sure whether that’d be illegal or not by itself).

But if they’re promoting each other regardless of product quality or value for the price, that’s unethical at best. And if they’re agreeing to a pricing scheme or taking products off the market during other peoples’ launch periods to reduce competition, I’d expect the FTC to be breathing down their necks really soon.

With that in mind, here’s a list of specific business practices I’d consider blatantly wrong:

• Fake Endorsements – I’ve said it before and I’ll say it again. Fake endorsements are wrong. You should not recommend a product unless you’ve personally reviewed it or used it yourself. In cases where you can’t review a product in advance (for instance, a seminar), then hedge your recommendation; tone it down a bit; let people know you’re making the recommendation based on the person’s reputation and not necessarily the product or service itself.

• Non-Payment of Affiliate Commissions – Let’s call this for what it is: theft. If you promise to pay a commission to your affiliates based on their performance, and then you refuse to pay them after they’ve performed, then you’re committing a crime. I know this happens quite a bit because people have a tendency to spend the money they owe to affiliates. Then, when it comes time to pay, they have nothing left. The trick is to discipline yourself so affiliate commissions are always paid first, no matter what.

• Paying A-List Affiliates, But Not B-List Affiliates – If you selectively pay out affiliate commissions, you’re guilty of favoritism. This is yet another form of theft (non-payment of affiliate commissions), but it’s more sinister because it indicates you actually do have the financial means to pay your affiliates — you just choose not to pay certain ones. It’s willful theft versus theft due to stupidity.

• Positioning a Product as a “Magic Bullet” When You Clearly Know It’s Not – I’m fine with enthusiasm, conviction, and metaphors in the sales process. If you have a great product, do your best to sell it! But I personally believe that you should not position a product as a cure-all if you know it’s not a cure-all.

• Using Intimidation to Prevent Competitors from Running Promotions at the Same Time as Your Launch – If you and a partner have agreed to promote each other’s products, then of course it makes sense to run your promotions at separate times so you can support each other. As Antone Roundy pointed out in his comment, it’s just smart business. But trying to prevent other promotions from happening by intimidating your competitors is just slimy — almost like what you’d expect the Mafia would do if you marched into their territory and started offering competitive “protection services.”

I’m sure there are other practices that should be included in this list, but these are the ones that come to mind.

So, what should you do when you see these things happening? It’s simple, really. You opt-out of the sales process. You unsubscribe. You choose not to buy.

As Stephen Dean pointed out in a recent blog post, November 2 was voting day. But so is today. And tomorrow. In fact, every day of the year is a day you get to vote for the businesses and charities you want to support.

Rather than get hung up on past financial mistakes you may have made, decide today that you’re going to make better choices. Decide today that you’re going to vote with your dollars and support credible businesses with good reputations. That’s really the best recourse you have — and the fastest way to effect change.

-Ryan M. HealySimilar Posts:

• Affiliates Are Still Being Ripped Off
• List Management, Fake Endorsements, and The Syndicate
• 5 Business Predictions for 2011
• How Many of Your Affiliate Links Are Dead?
• Best Link Cloaker?

The Salty Droid dropped a bombshell this week by publishing select portions of a private phone call between Andy Jenkins and Jeff Walker in which they say some things that are not especially flattering for their public image.

I guess it could be argued that “all PR is good PR,” but in this case I have my doubts. Here’s the recording, in case you’d like to hear it.

Andy Jenkins and Jeff Walker Riff About the
Video Boss Launch, Salty Droid and Ken McCarthy

In case you don’t have 7 minutes right now, or you’d rather not be exposed to the swearing, here are a few of the highlights:

Audio Highlight #1

• “The fact is, [Video Boss] is not a magic bullet, even though we’re going to position some of it that way.” -Andy Jenkins

My comment: Not a good idea to intentionally overhype your product or consciously deceive your customers. Even worse to admit to it on a recorded call.

Audio Highlight #2

• “I’m going to be relying on Syndicate to hit this thing really, really hard.” -Andy Jenkins

My comment: This call is from circa January 2010, so The Syndicate has been around at least since then.

Audio Highlight #3

• “The Droid I’m sure will go ballistic, but he’ll go ballistic no matter what you do. [...] He is like a little pimple on our butt. He has no reach, never will have any reach, will blow himself up. He’s non-existent. He’s less a threat to us than Mike Long was. Far less a threat to us than Ken McCarthy.” -Jeff Walker

My comment: Salty Droid has no reach? That was wishful thinking even in January 2010. (His current Alexa ranking is 18,303.) And is Ken McCarthy more dangerous than the Droid? Possibly. More on that in a minute.

Audio Highlight #4

• “Just think about this, like, with the Droid. He’s saying we’re evil because we’re charging a lot of money for our product. And that’s why we’re evil. Which is like the most ridiculous thing because it’s not like we’re like holding someone at gunpoint and saying ‘give us your money.’” -Jeff Walker

My comment: I don’t think Salty Droid’s crusade is based on charging high prices (although that may be part of it). I think it has far more to do with the anticompetitive behavior of The Syndicate, which is essentially an Internet marketing cartel — a “good ol’ boys club.”

Is Ken McCarthy More of a Threat Than Salty Droid?

During the call, Andy and Jeff mention Ken as an even greater threat than Salty Droid. This has prompted a lot of people to ask, “Who is Ken McCarthy? And what is his part in all this?”

In case you’ve never heard of Ken McCarthy before, he has been teaching Internet marketing since 1994, longer than just about anybody else online. He is also the creator of the System Seminar, an annual Internet marketing training event.

Many of today’s gurus got their first chance to speak on stage at the System Seminar. As Ken points out, “Some did good things with the opportunity. Some leveraged the exposure into criminal enterprises which I’ve had nothing to do with.”

It’s not always easy to judge a person’s character when you first meet them. Sometimes you may know a person for a few years and still not really know them. So as soon as Ken realized some of the shady things going on, he warned his subscribers. Here’s what Ken says in his own words:

1. I was one of the very first people to teach Internet marketing and thousands of people learned from me…

2. Including many of the people who became members of the Syndicate.

3. When I realized what they were up to I very publicly warned my students and customers to avoid them, thus earning the Syndicate’s undying enmity.

So why is Ken considered a threat? Probably because of his credibility and his reach. If he really wanted to, he could make life miserable for the Syndicate.

Even if he could, it’s probably not necessary. After all, for nearly two years now, the Salty Droid has been wearing the mantle of “Chief Internet Marketing Muckraker.” And since his most recent post…

The Gurus Are Now Distancing Themselves from… Themselves!

Regardless of whether or not Ken McCarthy is the bigger threat, Salty Droid’s most recent sleuthing seems to have caused the usual suspects quite a bit of consternation. In fact, at least two of them have now written blog posts trying to recast themselves as paragons of virtue.

• Mike Filsaime has published a post outlining his “best practices” that will now govern who he will (and will not) promote. (I find this post a little bit suspect since it seems to me that Mike has in the past repeatedly violated his own best practices.)

• Frank Kern has published a post challenging his subscribers to not buy any advice for a month. (According to one source, Frank then emailed his list to promote the Kajabi launch a few days later.)

Even Rich Schefren, who hasn’t promoted major launches the last couple years, felt compelled to send out an email to his list explaining why he no longer associates with the Syndicate.

But Here’s the Strangest Part…

Probably one of the weirdest parts of all this is that Mike Filsaime publicly said he would “address” Salty Droid and essentially set things straight. He stated this on his “best practices” post linked above. But then, for some strange reason, he had second thoughts and deleted all references to Salty Droid/Jason Jones.

For the record, here are two of the things Mike said publicly on his blog:

Jason Jones is a sad human being and I pitty him. And you for following him. I will deal with him soon. Jason Jones will finally hear from me. Now go run to his hate blog and warn him about me. I will expose him for the low life he his. Go now minion, go run to your powerful OZ. Jason Jones, you reading this. Get your costume on and make your post. It’s my turn. A sad human being will now be seen for what he is.

And in a separate place:

Minions of Jason Jones. I have spent the better part of the day talking to the 5% of you that are coming from his blog to try to spin this and trash me as you stated you would on his blog. We had good comments coming from people. All of a sudden a minion posted my blog on his blog and you are all coming here now to trash talk the same things you are saying there. As I said, this week I will address Jason and his hate confused followers.

Then, on the night of October 5, 2010, Mike revised his blog post and all mentions of Jason Jones mysteriously vanished into cyberspace. Even Google cache can’t find them (although they are still reproduced in the comments on Salty’s blog). Here’s what SD wrote:

The Gnome just deleted all his references to “Jason Jones” and turned off commenting. [...] I’ll still be expecting that big expose Gnome :: I wouldn’t want you to disappoint all your fans :: you rockstar you.

So is Mike’s rebuttal still on its way? Who knows. At the very least, it appears it will be delayed. (UPDATE: I stand corrected. Mike has responded, just not on his own blog. He has responded on Mike Young’s blog: 8 Things You Should Know About Mike Filsaime)

Anyway… What do you think? Is the Salty Droid a real threat to The Syndicate? Or, as Walker puts it, is the Droid simply a “little pimple on [their] butt”? Leave a comment to add your two cents.

-Ryan M. HealySimilar Posts:

• Is Salty Droid Even Human?
• How Free Market Economics Really Works
• Jeff Walker: Disingenuous Damage Control
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As a list owner, I feel a certain responsibility to you, my dear reader. Therefore, it’s my goal to provide you with rich content mixed with occasional offers for products and services that may benefit you.

Obviously, if I endorse somebody else’s product or service as an affiliate, then that means I’ve either purchased the product myself (or at least gotten a review copy) and found it exceptional enough to endorse.

And, in fact, many of the products I endorse on my blog and via email are products I’ve purchased and continue to use to this day.

Now, what if I formed a mastermind group with my competitors and we all got together and decided that we would promote each other’s products every time, without fail, no matter what?

Don’t you think that would diminish the value of the endorsement?

Of course it would.

Why Endorsements Work

A genuine endorsement is the use of your reputation to build trust for a product, service, or person who might not have been trusted as quickly otherwise.

For instance, you don’t know Adam. But you’ve known Brian for many years and you’d trust him with your life. Brian says, “You’ve got to listen to Adam. He’s brilliant.”

Now Adam has risen in stature and importance because of Brian’s endorsement.

But if you discovered Adam was paying Brian for the endorsement, it wouldn’t mean as much. And if Brian had agreed to endorse Adam no matter what — even if he began doing unethical or illegal things — then that would REALLY be suspect.

Now let’s look at a real-world example…

Exposing the Syndicate

Let’s say twelve Internet marketing guys get together. They all agree to promote each other’s products no matter what.

Furthermore, they all agree to promote just one guy’s product each month during the next 12 months. They all promote Product #1 in Month #1, Product #2 in Month #2, and so forth. This way each guy has the full endorsement of the rest of the group during his particular promotion.

If I was a part of this group, that would mean I’d have to promote 11 products as an affiliate, one product per month, based on a predetermined schedule. In exchange, the other 11 guys would then promote MY product during one of the 12 months when it was my turn to be promoted.

The catch? I absolutely MUST promote all 11 products… without regard for the quality of the products or the integrity of the creators of those products. In other words, my endorsement is guaranteed and cannot be negotiated or revoked.

Sound a bit fishy?

That’s because it is.

Here’s the pattern that emerges as illustrated by Alexa traffic rankings (hat tip to Salty Droid for coming up with this idea)…

The Proper Role of a Teacher, Blogger, or Publisher

Part of the role of a teacher, blogger, or publisher is to provide information that helps your readers reach their goals while filtering out irrelevant offers and reducing the signal-to-noise ratio.

Obviously, if a teacher has agreed in advance to wholesale endorse and promote products that don’t even exist yet, then you can be sure he’s not doing a good job of fulfilling his role.

The truth is, there are many reasons to NOT promote another person’s product or service.

• Product/service not up to your standards.
• Product has not been created yet and cannot be evaluated.
• Reputation of product creator is questionable and/or dubious.
• And the biggest reason of all…
  The product/service is not a good fit for your list!

Remember: If you publish information or are responsible for providing guidance to a list of subscribers, then you need to always have their best interests in mind. You need to be thinking about how to best help them… and protect them.

But if you are part of an organized group of competitors who’ve pledged to promote each other, you simply can’t do what’s best for your readers.

What happens if I (as a member of the group) don’t feel like one of the products is worth promoting? Or what if one of the members of the group gets involved in some shady business dealings? What then?

The answer is… I can’t really do anything unless I want to risk losing my position in the group — and missing out on the windfall I’d receive from the promotion and endorsement of the group.

The Syndicate Is Real

It probably comes as no surprise to you that within the Internet marketing community, such a group exists. They call themselves “The Syndicate.” And industry insider Ray Edwards says they actively plot and scheme how to take your money.

There is a very real conspiracy to extract as much money from you as possible.

Right now, as I write this, there is a group of “gurus” sitting in a circle in some hotel suite.

Each one of them is talking about their own version of Method X, and how he plans to sell it to the masses.

And they are all agreeing to promote one another’s Method X.

…and that’s why you keep getting email after email from the same group of people promoting one another.

Kinda creepy, isn’t it?

But this is what happens behind closed doors.

Backlash from the Product Launch Machine

If you’ve been trying to make money on the Internet for any length of time, you’ve probably gotten sucked into the orchestrated promotional efforts of the product launch machine.

At first, it feels exciting to be a part of these virtual events. But it doesn’t take long for the launch buzz to begin to feel like a drain on your attention, your focus, and your wallet.

In some cases, this feeling leads to public outcry. For instance, after the StomperNet launch, Rick Butts advised his list to unsubscribe from anybody who promoted StomperNet.

And when Michel Fortin announced that he was unsubscribing from lists by the hundreds and purging his way to email freedom, there was a chorus of support and agreement.

Let me be clear: I’m not against selling, advertising, affiliate marketing, or even product launches. I think they are legitimate ways to sell under the right circumstances.

But I am against phony endorsements, disingenuous recommendations to buy, and syndicates designed to defraud.

-Ryan M. Healy

P.S. What’s your take on all this? Leave a comment and let me know.Similar Posts:

• Product Creation Work Group
• Ken McCarthy More Dangerous Than Salty Droid?
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Lots of people come and go on email lists. A few of them actually tell me why they unsubscribed. These are some of the most fascinating responses because they’re usually passionate — and I struck a nerve.

Here are a few reasons people have unsubscribed from my email list this year and last year.

******

I am unsubscribing because of the most recent post and your saying that we should not have responded to 9/11. Thank you.

(I suggested forgiveness as an alternative to revenge. So this guy unsubscribed. Go figure. -RMH)

******

It’s just a lot of e-mail to add to already too much e-mail received daily, especially when I never explicitly opted in to receive these e-mails

(To this woman’s credit, I checked my opt-in page and realized I wasn’t saying subscribers would get email updates. So I changed this. -RMH)

******

I just have signed up for too many blogs. I’m on information overload.

******

I am sorry.But you have no value or you do not give any free e-book guides,software,cource,etc,.

******

Very good and valuable information but have to decrease the amount of email coming in… hard decision but will have to unsubscribe at this time. Thanks for all you do!

******

internet marketing is a huge scam and nobody honestly makes a living online

******

Tired of being sold things instead of given useful content.

(This one surprised me. In the month of April 2010, I’ve published 8 posts. Four of them have had soft sales pitches. Not a single pure sales message — and this person still freaked out. -RMH)

******

To many newsletters, I need to focus on the most relevant ones to my industry. I think you do good stuff. Except the references to your religion, then, I better not say anything.

******

I love your writing, I just don’t have the time to read everything in my inbox

******

I am an Obama supporter and DO NOT appreciate you posting such negative remarks about him…I no longer want to hear from you. You are entitled to your opinion and I am also entitled to mine. I did not like this post.

p.s. I WAS really a big fan and follower of you and your IM work. Not anymore.

(Amazing how radically a political difference of opinion can polarize people. This response proves it. -RMH)

******

Believe it or not, I’m actually happy when I get passionate reasons why people unsubscribe. It tells me that I’m bonding with people who are on the the other side of a particular viewpoint.

It also tells me that I’m standing up for something.

The only way you’ll ever develop a loyal following is by standing up for a particular point of view. This allows other people to identify and bond with you.

You can’t be all things to all people, so this is a good thing. Embrace that you’re never going to please everybody. Just do your best at being who you are — and writing to the white hot core of your fan base.

-Ryan M. HealySimilar Posts:

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“Mega” is such a hypey word, isn’t it?

But I think selling $150 million in a single day qualifies as a mega launch. To my knowledge, this figure puts to shame any kind of product launch ever done in the Internet marketing space.

Of course, I’m not talking about yet another home study course; I’m talking about the launch of the new Apple iPad.

Seth Godin shares 12 launch lessons that can be applied to just about any business at the link below. This is worth your time…

Secrets of the [almost] biggest selling launch ever.

-Ryan M. HealySimilar Posts:

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Earlier this week, Remarkablogger (Michael Martine) suggested:

Consider a post that rounds up a list of the “good guys,” too.

I think this is a good idea. I’m going to put together a list of trustworthy online marketers. But I need your help.

With that in mind, I want to know:

Who are the good guys and gals in online marketing? Who would you want to be on this list?

Most importantly, why?

Two rules:

1. You can’t nominate yourself.

2. No bashing or flaming allowed. Recommendations only.

Got it? Now scroll down and nominate your favorite online marketer in the comments.

-Ryan M. Healy

P.S. Why are comments now closed? Read why here: Disinformation, Subterfuge, and Propaganda

Similar Posts:

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Are Internet marketing “gurus” just a den of thieves? And is Internet marketing itself now on life support as a result of their unethical business practices?

The reason I ask these questions is because recent events have forced me to ask them.

Internet marketing “gurus” are being called out left and right, new advertising rules are going into effect, people’s merchant accounts are being terminated without notice — it’s probably the biggest shake-up to hit Internet marketing since the first big “Google slap.”

Let’s take a look at some of the “recent events” I’m talking about:

Event #1: Perry Belcher “Retires”

Here’s the short version: Perry Belcher sold fraudulent health supplements through his company called Selmedica. When it was discovered he was committing fraud, authorities seized Belcher’s assets, auctioned off his home, cars, and other possessions, and gave him a 10-year probation.

In what appears to be an attempt to side-step the terms of his probation, Belcher partnered with Ryan Deiss to promote products on the Internet again. “Get Money from Google,” “Social Media Blueprint,” and other programs followed.

But after much dogged persistence by Salty Droid, Perry Belcher pulled the plug on all his online businesses, deleted his Twitter account, and announced his “retirement” from Internet marketing. (Or, more accurately, forced retirement.)

Event #2: Eric Graham Fails to Deliver

Eric Graham is known as the Conversion Doctor. He helps people improve the conversion rates of their web sites. In the past, I’ve been impressed with Eric, and even went to an event in Denver specifically to meet him. (That’s where I got the picture at right.)

Anyway, I was surprised to learn that over the last year or two that Eric has continued to make big promises, but — according to the testimony of multiple customers — has not delivered fully on those promises. Worse, he has denied refunds and not honored his own guarantee, which he features prominently in his sales process.

I wouldn’t even have been aware of these issues had not Fred Black written in detail about his own unsatisfactory experiences with Eric Graham. I respect Fred and his work, so I take this issue fairly seriously.

Turns out, Fred is not the only one who’s spoken out against Eric Graham. There seems to be a pattern of negligence. “By the mouth of two or three witnesses every fact may be confirmed.”

Event #3: StomperNet Descends into Chaos

Ken McCarthy (an Internet marketer who has my utmost respect, by the way) introduced Brad Fallon to the Internet marketing community back when I still had a job.

I bought the first “Stomping the Search Engines” program, listened to it in my car, and used what I had learned to build a site that’s been cranking out $20 to $70 a month for more than five years now. The methods described in the program worked for me, so I thought highly of Brad — at first.

Well, Brad went on to partner with Andy Jenkins and formed StomperNet. They did a big launch, claimed to make millions — and from the outside, everything looked peachy.

Here’s what I found interesting: With the exception of giving Brad Fallon his initial credibility, I don’t think Ken McCarthy ever promoted him again. I had always wondered why.

Now I don’t wonder so much.

Andy Jenkins (no saint himself) ended up suing Brad Fallon. They haven’t paid affiliates from the first StomperNet launch. And now Brad has sued his own wife (Jennifer Fallon) over ownership of their wedding favors business. (Oh, they’re getting divorced, too. No surprise there I guess.)

And just so you know I’m not making this stuff up, you can read all about the StomperNet shenanigans on Salty Droid, links to legal docs included. (Warning: Strong language.)

Event #4: New FTC Rules Go into Effect

On December 1, 2009, new FTC rules went into effect. As you may know, these new rules were a backlash caused by “flogs” — fake blogs — being created and multiplied by certain Internet marketers.

The new rules say that if you feature testimonials that include specific results, then you must also prominently describe what “typical” results are. Disclaimers like “Results not typical” are no longer sufficient.

For an in-depth review of the rules, what they mean, and how you should respond, I recommend listening to the Easy FTC Compliance Seminar posted on Robert Skrob’s blog. (There’s also a handy PDF download in case you prefer to read.)

Event #5: Visa & MasterCard Crack Down on Merchants

On January 14, 2010, I received notification from PowerPay (my merchant account provider) that Visa and MasterCard is cracking down on what they consider “brand damaging” business practices.

Behind the scenes, Visa and MasterCard provided merchant account providers with a master list of “worst offenders.” Merchant account providers were told to immediately terminate the merchant accounts of these worst offenders — or face $100,000 fines per infraction.

As you can imagine, faced with $100,000 fines, merchant account providers acted swiftly. And a client notified me on January 16 that the merchant accounts of four major Internet marketers had been terminated. (It’s probably no surprise that three of the four have been targeted by Salty Droid.)

What Does It All Mean?

First of all, let me say that I think there are many Internet marketers who’ve crossed the line and should not be followed, supported, or endorsed. Enough is enough.

Let me also say that I believe there are many ethical Internet marketers who deliver fair value for a fair price — and do not engage in high-pressure sales, deceptive marketing methods, or the outright fraud I’m now aware of.

What this means is this:

• You must choose your mentors and teachers in the online space wisely.

• You must be especially wary of outrageous, hyped-up claims. (If it sounds too good to be true, it probably is.)

• When possible, you should get a second opinion from someone you trust when you’re tempted to spend a large sum of money for an event, coaching program, home study course, etc.

• And, possibly most important of all, you must protect your reputation. Because, in the end, your reputation is the most valuable asset you have.

Internet marketing is not going away. The Internet will continue to be a marketing medium. But how that medium is used will most definitely change — possibly more dramatically this year than ever before.

Ultimately, I don’t think there’s any reason to panic. But you should certainly be proactive about complying with the new rules and making sure you’re dealing with reputable online business owners. (This advice is as much for me as it is for you.)

Really, it all boils down to these three things:

1. Guard your mind.
2. Guard your wallet.
3. Guard your reputation.

Simple, for sure. But as most principles go: easier said than done.

-Ryan M. Healy

P.S. So far, my 4th business prediction for 2010 — “The End of the Internet Marketing Guru as We Know Him” — is happening a LOT faster than I expected.

P.P.S. Would love to get your comments on this post. Were you already aware of these issues? How do YOU think all these changes and revelations will affect Internet marketing?

P.P.P.S. In case you are interested, here are the new merchant account terms as spelled out by Jud Smith of PowerPay:

PowerPay cannot accept merchant applications for products and/or services employing “Negative Option” enrollment, in addition to the following practices:

Marketing models that employ “Free-Trial”, “Deferred Billing” and/or “Shipping Only”. Customers must be receiving a tangible good or contracted service in exchange for charging of payment cards. Incentivized discount offers are acceptable when the cardholder is receiving something in exchange for payment, however we will be unable to support accounts engaging in hidden or delayed charges and ‘free’ offers that are not truly free.

“Cross-Selling” and “Up-selling” business practices. All sales should be directly between the business entities (merchant) processing the transaction and the cardholder, with cardholder authorization for all purchases.

Per Payment Brand guidelines, the use of multiple merchant accounts, billing descriptors and merchant processors may be viewed as an attempt to avoid chargeback monitoring programs and is prohibited. Perceived non-compliance has led to termination of processing relationships. PowerPay will review the business consideration for opening multiple merchant accounts to ensure compliance with Payment Brand guidelines.

Transactions generated from internet traffic and all other lead sources must be managed and monitored for potential fraud using an approved system. Third Party service engagement may be a requirement for account approval.

The FTC has recently published guidelines regarding “Negative Option” enrollment programs and is taking a very aggressive position against merchants utilizing/employing this business practice. Recommendations take in part from the FTC’s website may include but are not limited to the following:

Material terms should be disclosed in a clear, concise manner. Unnecessarily long or inconsistent terms are viewed as an attempt to mislead the consumer.

Terms should be disclosed in a conspicuous manner, clearly placed and labeled on websites in a location that indicates the importance and relevance to the transaction. Fonts and colors must be easy to view.

Material terms must be disclosed prior to completion of the transaction and before a financial obligation is incurred by the consumer.

Customers must provide affirmative consent to any offer, examples include a mandatory “I Agree…” statement checkbox, where the customer is acknowledging the Terms and Conditions of the offer and consents to be entered into continuity program as a result of completing the transaction. Pre-checked boxes do not qualify as affirmative consent.

Merchants must not discourage or make difficult in any way the disclosed cancellation procedures and all cancellation requests must be honored in accordance with the stated terms of the transaction.

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