A good friend of mine runs PPC campaigns for some big brands, and he HATES affiliates.
His experience is that they don't any value as a channel, they just increase CPA by competing against the direct channels and cannibalising traffic. In every company he's persuaded to can their affiliate scheme and run it all direct, he's managed to decrease overall CPA whilst maintaining volume.
I have to say, that ties up with my own experience - I did some work last year for a heavily-funded Groupon competitor, and they used some of the big networks (affiliate window-type ones, not pure CPA nteworks) to do lead gen on a CPA basis.
They got a SHITLOAD of leads, and spent a fortune, but even though they spent ages trying to scrub out fraud, their conversion on the CPA leads was almost zero, compared to some pretty respectable numbers for PPC.
A lot of people wanting to do affiliate marketing (present company excluded of course) aren't really interested in doing a good job for the company or helping their brand, they want to make money as quickly as possible, and if that includes fraud, so be it.
If you want proof of this, look at how carefully network owners screen their applicants now
I'm not relating this to hate on y'all, because I suspect that the average WF member is far better than most, but to relate it from a "big company" perspective.
A lot of them think affiliates = scammy bullshit.
Another thing to add into the mix is that the mission of a CEO isn't to make more money. It's to increase shareholder value. And although some of that comes from increasing the bottom line, it also comes from increasing the value and prestige of the brand.
If they do ANYTHING which backfires and makes the company look bad or embarrasses their shareholders, it doesn't matter how much money they made, they'll be getting a pink slip.
The corporate world is very risk-averse for this reason.
Hence, even though they could make more money, the reputational risk probably isn't worth it. And even if your client doesn't have shareholders, he probably sells to corporates, so he needs to keep to the same rules.
