Affiliate fraud can snakebite any affiliate program. No matter how careful you are, affiliates out there are going to try to hustle to make a buck, so affiliate managers need to be aware of their surroundings to combat it.
What is Affiliate Fraud?
Affiliate fraud refers to deceptive practices aimed at manipulating affiliate marketing programs for personal gain. In affiliate marketing, businesses reward affiliates (individuals or entities) for driving traffic or sales to their products or services through referral links. However, affiliate fraud involves exploiting the system by generating false clicks, leads, or sales to earn undeserved commissions.
There are several forms of affiliate fraud, including click fraud, where fraudulent clicks on ads or links inflate referral statistics; cookie stuffing, which involves forcefully adding affiliate cookies to users' browsers without their knowledge; and lead fraud, where fake or low-quality leads are generated to claim commission. Such fraudulent activities not only harm businesses financially by diverting resources to non-existent or low-value customers but also erode trust within the affiliate marketing ecosystem.
To combat affiliate fraud, businesses and affiliate networks implement various preventative measures and monitoring tools. These measures include implementing strict affiliate screening processes, setting up fraud detection algorithms, monitoring traffic and conversion patterns, and establishing clear terms of service that outline consequences for fraudulent behavior.
Continuous monitoring and prompt action are crucial to maintain the integrity of affiliate marketing programs, ensuring that legitimate affiliates are rewarded for their efforts while fraudulent activities are minimized, if not eliminated.
3 simple steps to keep your affiliate fraud away.
Affiliate fraud can get out of hand quickly if it isn't monitored and prevented properly. Take these steps to set your program up for success.
Step #1 – Turn Off Auto-Approve.
Fraudsters want to lay in the bushes, unnoticed in the shadows. They will hunt down programs that are on auto-approve and exploit the holes in the program. This is the first door they look for into infiltrating your program. Review all applications to see if they are a good fit. I recently applied to 1000 affiliate programs to do a field study. Shockingly I saw 56% of programs on auto-approve. Don't be this program!
Step #2 – Strong Program Terms & Conditions.
Fraudsters are looking for programs that have weak terms and conditions, and especially those that have none. You don't need legalese to be in control, just terms that make it clear that you mean business. Performance Marketing Manager Mastermind offers templates to help you create the perfect terms and conditions.
Step #3 – Protect Your Trademark.
Savvy affiliates are on the hunt for programs that do not list protected trademarks in their terms and conditions. They will join the program, create some content (maybe), and create PPC campaigns to drive traffic to your site through their affiliate link. This will drive up the prices of PPC ads, costing that channel more ads spend (plus affiliate commissions. List an array of trademark keywords and modifications to make it clear to affiliates that this practice won't be allowed.
Ready to learn more?
Download is free checklist for the 8 Red Flags of Affiliate Fraud here.
In this download you will learn what to look for to prevent affiliate fraud from happening to your program.
