The big news in the points & miles world today is that Bankrate has acquired Million Mile Secrets. I’m glad MMS made a public announcement; that’s more than we got from The Points Guy. As Skift wrote in 2014:
In 2012, Mr. Kelly sold The Points Guy to Bankrate, a publicly traded company that publishes and promotes financial content. While he retains editorial control, Bankrate provides organizational support and some affiliate links. But outside of two email addresses in the site’s terms and conditions, there’s no mention of the relationship with Bankrate.
I don’t think the Points Guy ownership issue was widely known until a commenter on my post on corporate ownership of blogs from a month before the Skift article helpfully pointed it out.
There were some other interesting comments on that old post of mine, too, like this one from Max at MaximizingMoney.com:
BankRate also owns CardSynergy, which used to be the independent credit card sub-affiliate network NCS Reporting, and they also acquired FlexOffers (CardOffers), which was also a previously independent sub-affiliate network and formerly one of the biggest competitors with NCS Reporting for credit card affiliate marketing, and through these networks, they control most of the credit card affiliate links that most bloggers use. They pretty much have a monopoly on credit card affiliate marketing, especially for bloggers.
Sounds like a nice little niche BankRate has carved out for itself, yes?
There was some Twitter debate (prompted by that rabble-rouser George) over the extent to which MMS’s announcement constituted spin. Look: Bankrate is a publicly traded profit-maximizing corporate entity and is not in business to help its friends and family, unless of course those friends and family happen to be shareholders. Of course this acquisition will be portrayed in the best possible light and of course this portrayal is spin.
But that doesn’t mean Daraius is a shady businessman, it just means he’s doing the logical thing. M&A transactions are always spun as a great thing and Bankrate’s latest acquisition is no different. That’s how the game is played. As for the question of how much of a say the new corporate overlords will have in how MMS is run: it’s possible that a publicly-traded company acquired a property it will direct resources to without requiring any profitability goals or top-line targets or editorial control at any point in the future… but that’s not the way I’d bet.
I don’t have much interest in the debate over whether bloggers who sell credit cards are good people; I think that–as is the case with the rest of humanity–some of them are and some of them aren’t. If you’re not actively plagiarizing my content I’m not going to have a strong opinion on your moral worth as a blogger. My concern is with the systems’ incentives. Think of it this way:
- If doctors received incentives to promote certain drugs over others, would such a system produce suboptimal results for patients?
- If investment advisers received incentives to promote certain mutual funds over others, would such a system produce suboptimal results for investors?
- If bloggers received incentives to promote certain credit cards over others, would such a system produce suboptimal results for readers?
Of course, getting the wrong credit card isn’t as bad as getting the wrong drug, but it’s the same principle in both situations. Incentives matter.
One angle that occurred to me after I read the chatter about it this morning is their divorce … probably makes splitting things up a lot easier if they no longer own the company together — just dividing a pile of cash. Also makes it easier for one to step away (and not work with their ex) before too long. None of my business of course, but that could also make sense.
The thing is he was already receiving incentives to promote certain credit cards over others. How much more can he promote them? So what exactly changed. Maybe he will now promote different cards over others?
Doctors do recieve incentives. Just ask a pharmaceutical rep how many dinners they have sponsored.
It is not clear if you are tongue and check concerning your list of comparisons: doctors and financial advisors and bloggers. You can add any profession you want, because the reality is this world “follows the money”. Doctors do get “paid” (trips, endorsements and speakers fees) to recommend specific drugs and devices. Just look at the published Medicare data. And investment houses push larger commissions on the monthly special fund they are touting. I have always assumed the bloggers I read are incentivized. It has always been up to the Internet reader to fact check and determine how the info is applicable to them. There are no journalistic standards on the Internet.
I saw some of your post on Travel Blogger Buzz, but thought this comment regarding doctors being compensated to promote drugs should be here too:
While maybe not being incentivized to promote some drugs over others, Drs are definitely incentivized to promote some products over others (e.g. Knee braces). My Doctor charges $800 for a brace. My insurance covers only 50%. Same brace online costs $186. And worse, not even given a choice between similar braces that would work. Why? Profit margins are the highest for a specific company. So why stock anything else?
Regardless of my opinions of any one blog, at least consumers in this space have a choice on what they consume and don’t, and how deeply they want to educate themselves on the subject.
All I want to know is, how much did they make in the deal? Was that made public? I imagine it would come out in Bankrate’s quarterly report if it hasn’t already. I have no problem with it and happy to see people making money from the internet and from something they created. That is the American way and why this country has been successful in creating private wealth. We’re currently headed the wrong way into hyper regulations, but hopefully the years ahead will improve.
Who cares? When was the last time anyone seriously into this hobby actually read MMS? There has been practically zero useful content for almost two years.
Same for TPG, it’s watered down drivel now. Nothing like what he used to write until 3 years ago.
I used to like Bankrate and TPG but not anymore. I am avoiding Bankrate and TPG (The Pathetic Guy) at all costs!
I’m not convinced it was just acquired.
In fact, I think it may have been 2 or more years ago.
He talks about the tech help in the past tense.
And these M&A deals usually have some sort of ‘earn out’ or other lockup period where the prior owner has to stay on.
Perhaps Bankrate made them keep it under wraps until the earn out / lockup ended.
And really he’s been with Bankrate for much longer.