An Open Letter from SaleHoo Regarding the Great SaleHoo "Scam"

This is an open letter from SaleHoo.com which we have published to clarify matters arising from the activities and allegations of Mr Terry Gibbs and his associates. You can learn more about SaleHoo at www.salehoo.com.

If there were a way to appropriately convey a heartfelt sigh over the internet, we would do that here.

This particular storm in a teacup has been raging for about nine months now, first on Terry Gibbs' "I Want Collectibles" site, and now both on the very charming "SaleHoo Sucks" site (salehoosucks.com) and on various article sites / review sites / forums across the length and breadth of the internet. Since everyone has heard Terry's opinion, it seems only fair that we now be allowed to present SaleHoo's side of the story. Readers can then draw their own conclusions as to whether this furor is justified.

The AuctionXFactor e-Lancer issue...

Most of you will have read Terry's caustic "reviews" of both SaleHoo and SaleHoo's "AuctionXFactor" products. You certainly don't have to look very hard in the search engines to turn up one of these reviews. In fact, salehoosucks.com comes up number 2 for the search term "SaleHoo" in Google.

The animosity Terry Gibbs displays for SaleHoo appears to stem from an issue we had with an e-lancer (electronic freelance writer) at the end of 2005. SaleHoo engaged an e—lancer to write some sales copy for a "how to get started on eBay"—type info product. The copy was written, the website made, and AuctionXFactor released.

Soon after, we were contacted by Terry Gibbs, who advised us that portions of the AuctionXFactor sales copy had been copied from his Auction Revolution sales copy. Obviously our e-lancer had taken some liberties/shortcuts with their research, and copied (or very slightly altered) quite a considerable portion of Terry's sales copy for use on the AuctionXFactor site.

We probably don't need to mention how disappointed we were about this. We more than understand Terry's anger — we've found other people plagiarizing our own products before and it's certainly not a business tactic that we actively employ ourselves. In this case, it was the e-lancer who plagiarized, and our only mistake was relying (understandably, in our opinion) on the e-lancer to create an entirely original work for the AuctionXFactor site.

Ok. So far so d'oh.

Following this notification from Terry, we revised the AuctionXFactor sales copy to try to allay Terry's concerns. Further objection from Terry ("It's still too similar!!") elicited an email from Simon Slade asking Terry to point out the sections of the sales copy that he objected to. We then took down the AuctionXFactor website and notified Terry that we would stop selling AuctionXFactor until the whole mess could be untangled.

Terry's response: "AuctionXFactor is a scam, and it's publisher is a crook!"

Terry responded by publishing a defamatory review on his "I Want Collectibles" website, attacking AuctionXFactor, and Simon Slade himself. Terry went so far as to publish Simon's home address and contact details on the website, claiming Simon to be some kind of criminal who deserves to be outed in the most public manner possible.

Terry's "reviews" of AuctionXFactor claimed that it was a "scam" because (in his eyes) it was an inferior product to his own Auction Revolution product. It's worth noting here than *none* of the content of the AuctionXFactor book was copied, paraphrased or plagiarized from Terry Gibbs' Auction Revolution product. Terry's objections centered only around how certain topics that were covered in great depth in his own product were covered in less detail in AuctionXFactor. If this were the case, it might indeed make AuctionXFactor an inferior product. It certainly would not make it a "scam".

The word "scam" seems to drop too readily from Terry Gibbs' pen. It is an emotive word, a sensationalist word, and a word that people are extremely wary of on the internet. Terry used this "scam" word again to attack AuctionXFactor's parent site, SaleHoo. It was at this point that we decided to get our lawyers involved.

A little about SaleHoo, before we move on...

SaleHoo, (for those who don't know) is a directory of wholesale suppliers and drop-shippers. It is a membership site where members pay a one-time fee for lifetime access to a regularly updated list of suppliers. Members are able to contact SaleHoo staff and chat with them online about any issues they might have, and if SaleHoo doesn't have a supplier for a certain product we will find one when a member makes a request. We have a lively forum where members are able to partner up with other members, and we frequently have suppliers jumping on the forum to offer special discounts to SaleHoo members.

Additionally, many suppliers set aside lots of products for SaleHoo members, so that members are able to purchase in smaller quantities than would typically be allowed, and we regularly purchase items from our suppliers to check the quality of both the product and service. The long and the short of it is we work hard to provide a really valuable service to our members, and we think we do a good job. If members disagree with us on this and believe they have indeed been "scammed" we are more than happy to refund their SaleHoo fee. SaleHoo has had a "no questions asked" money back policy since it started, and our people are instructed to act on these requests as soon as we receive them.

And that's the thirty-second sales pitch.

SaleHoo under attack:

Terry Gibbs' arguments regarding SaleHoo's supposed "scam" status are as follows:

1) It's impossible to find unbiased reviews of SaleHoo because we attack all such reviews with lawsuits.

Can you imagine the time, energy and resources it would take to engage each and every negative reviewster in a legal battle? Have you even looked at the internet these days? We chose to tackle Terry Gibbs because we considered his "review" to be very clearly defamatory, misleading, malicious and just plain wrong — and Terry's "review" was causing enough of a stir to be impacting on SaleHoo's business.

On a similar point, Terry also claims that our affiliate program (paying 75% commission for each referred sale) unfairly slants reviews in our favor. Terry's logic holds that paying such a high commission is tantamount to bribery. We're not sure if Terry has looked around lately, but 75% is not an unusually high affiliate commission for info-products. Even the most cursory search of the ClickBank marketplace would confirm this. In fact, Terry himself offers a 75% affiliate commission to attract affiliates to his Auction Revolution product. Are we to assume that all reviews of Terry's product are similarly slanted? Additionally, any affiliate worth his or her salt knows that biased, gushing reviews of undeserving (or untried) products will do more harm than good to both their reputation and profits in the long term. Running an effective affiliate campaign does not make SaleHoo a "scam".

SaleHoo is by no means opposed to freedom of speech, and we're not worried about fair reviews, criticisms, or comments about SaleHoo as a product. It is the inaccuracies and accompanying untruthful allegations of fraudulent behavior that motivated us to contact our lawyers. In our opinion, Terry Gibbs was wrong (and so wrong so loudly that we felt we needed to take action). As far as we're aware, Terry Gibbs has never purchased a membership to SaleHoo — he might have never been inside the members' area. We consider that his assertions have absolutely no substance. In our view, he's building a big house on mashed potato, and he's hurting an honest business with his false "scam" claims.

2) SaleHoo's "unbelievable deals" are not deals at all.

Terry argues that you're able to find much cheaper items on eBay without having to purchase SaleHoo membership and go through a wholesale supplier. Terry compiled a table of figures comparing "Quoted retail price", "SaleHoo price" (from the SaleHoo website) with prices he found for similar items on eBay. He then worked out how much money you would lose if you purchased this item from SaleHoo rather than on eBay. His conclusion is that you're much better off purchasing directly from eBay and that SaleHoo offers no tangible benefits. (And therefore, we guess, SaleHoo is a "scam".)

While the table and figures seem convincing, they are wrong. Here is an excerpt from the letter our lawyers sent to Terry:

'Pricing inaccuracies

The statement "Motorola V3 Silver...eBay Price $154.55" is incorrect — when the user clicks the link for the Motorola V3 Silver price, this is actually $209. Wholesalers listed on Salehoo's website are currently offering that item for $173. The statement "Sony Ericcson V800...Salehoo Price $322" is incorrect — Wholesalers listed on Salehoo's website are currently offering that item for $213. The inaccurate and out-of-date pricing information in the table creates a false impression regarding the pricing comparison between the "eBay Price" and the "Salehoo Price".'

To translate from lawyer-speak: Terry was claiming that items could be found cheaper on eBay than on SaleHoo, but some of the prices he gave were wrong. In some cases Terry's eBay prices were actually higher than he quoted, and in other cases SaleHoo's prices were lower than he quoted. It's possible that these figures were correct when Terry wrote his "review". We can argue back and forward about this until we're all blue in the face: The fact is that both eBay prices and the prices available to SaleHoo members fluctuate regularly. You can't make sweeping generalizations based on a single snapshot. This is also not forgetting that Terry was, in some cases, comparing *used* or *refurbished* items on eBay with Salehoo's *new* items. In any case, none of this equates to SaleHoo being a "scam".

Cease and desist time! Terry takes down his "review"

Back to the timeline, SaleHoo's lawyers sent a letter to Terry Gibbs informing him that the comments he was making on his website were false, defamatory, malicious and contrary to the terms and conditions of his hosting and network providers. Well, wouldn't you? We asked Terry to remove these pages, offer an apology, and refrain from publishing any further false, misleading or defamatory statements about SaleHoo. Terry's ISP requested that Terry remove the defamatory material.

Salehoosucks.com emerges

Terry took down the pages temporarily, but then published them again (or else he permitted or arranged for them to be published) on salehoosucks.com. We assume that Terry (or a friend, partner, relative, contact, neighbor, or other associate of Terry's — either real or imaginary) is operating salehoosucks.com. We assume. It's difficult to confirm the identity of the person behind salehoosucks.com because he (or she) has used an anonymous domain name registration service to intentionally hide his or her real name and contact details. Because of this we have to refer to "Terry (or his associate)" when talking about the actions of the registrant and administrator of salehoosucks.com. We'd encourage Terry (or his associate) to be a little more upfront about who exactly is operating salehoosucks.com, instead of just attacking SaleHoo from behind a veil of anonymity. At the very least it would save us from these (irritating parentheses).

An indignant aside — The modified "review"

At this stage we want to point out that the "review" currently available at salehoosucks.com has been substantially modified by Terry as a result of our lawyers writing to him. Terry has modified his original "review" to remove defamatory statements — but neglects to mention this fact to visitors at salehoosucks.com. With visitors to salehoosucks.com seeing only the new, sanitized and comparatively tame "review", Terry (or his associate) then paraded the sanitized "review" around and used it to attack SaleHoo for supposedly "threatening anyone who posts information not favorable to SaleHoo on the web with defamation suits". We find this approach to be a little misleading, to say the least. Obviously we did not call our lawyers in to stifle free speech but to stop Terry publishing those original defamatory statements (which you now can't see.)

Terry (or his associate) argues that his right to make these comments is protected under the First Amendment — encouraging comments on salehoosucks.com from others who feel like they have been "scammed" by SaleHoo. People claiming to be Simon Slade have posted messages on the salehoosucks.com bulletin board, and when we've posted messages saying that these comments aren't from Simon Slade (Simon has never posted on this bulletin board), Terry (or his associate) has said that we're lying. When people have posted positive comments about SaleHoo on the bulletin board, Terry (or his associate) has removed them. For someone who believes so strongly in the right to free speech, we find this type of behavior to be a little contradictory. Terry has also submitted reviews, articles and comments to a variety of other websites. As mentioned before, the upshot of all this activity is that any search in Google for "Salehoo" typically pulls up salehoosucks.com and Terry's "SaleHoo is a scam" articles.

The consequences...

As we all know, the internet has a long memory for this sort of stuff. SaleHoo is going to be affected by Terry's actions for a while to come. Understand that we are usually the first to cheer the "instant karma" effect of the internet — we believe that bad products die natural deaths once word gets out, and scams are easily revealed and quickly quashed by the democratic nature of the web. This is all good stuff.

But what happens when there is just one angry little man with a vendetta and a big mouth? This is the issue facing SaleHoo at the moment. This is why we're giving you all the information we have here.

But why so much animosity? These are our theories...

We are rather unsure as to why we've attracted the fury of Mr Terry Gibbs. It is possible that Terry does actually believe that our products, people and business methods are the work of the devil. There's little we can do in this case but try to assure him that no, we're just some guys sitting in an office, working hard and occasionally playing foosball. We have no horns or tails. We would hope that the information we've provided and the support and goodwill we have in the internet community would be enough to convince Terry and anyone else that we do good work.

It's possible that Terry found his initial interaction with SaleHoo regarding the AuctionXFactor issue to be so personally grievous that he needs to attack SaleHoo and everyone associated with it. If this is the case then we offer our most sincere apologies to Terry for all that transpired with regards to AuctionXFactor. We did not set out to harm his business, and we did what we could to fix the situation as soon as we were aware of it. If our efforts were too little, too late in his eyes, we're sorry.

In our view, it's not inconceivable that Terry Gibbs (or his associate) is using this crusade against SaleHoo as a marketing tool to build Terry's business. By being seen as a "scambuster" and "crusader against Internet fraud", Terry (or his associate) increases Terry's perceived credibility and, in turn, the success of Terry's products. Throughout salehoosucks.com there are links and references to Terry's own Auction Revolution product. Most notably, there are banner ads on most pages. We consider that Terry (or his associate) has chosen to carry out an unjustified and vengeful campaign against SaleHoo — creating a "spite site" about SaleHoo and then using that site to promote Terry's own products. In short, we consider that the actions of Terry (or his associate) amount to an Internet-based version of "blowing out someone else's candle to make yours glow brighter". We had hoped that Terry would value his business and reputation enough not to pursue or permit this method of self-promotion. Like we said before, the internet has a long memory — and what goes around, comes around.

In conclusion...

That's our side of the story. We hope that anyone considering the information presented will listen to our arguments as well as Terry's arguments and form your own opinion based on intelligence and common sense rather than sensationalism. We can't really ask anything more.

Sincerely,

SaleHoo.com