Affiliate fraud detection can be a significant financial burden for businesses, depleting marketing budgets and skewing analytics metrics. Additionally, it can result in a loss of brand equity and customer trust. Additionally, businesses may be subject to chargeback fees if fraudulent affiliates make fraudulent purchases or use stolen credit card credentials to recoup lost earnings.
To protect against affiliate fraud, businesses should enact a comprehensive terms and conditions document that defines unacceptable behaviors. This should be followed by regular employee training to help them identify unusual activity. Additionally, leveraging tools that detect click fraud and other common forms of affiliate scams can be an effective way to monitor the performance of your affiliates. These tools act as automated affiliate watchdogs, allowing advertiser teams to focus more on their work and less on policing behavior.
The Affiliate Marketer’s Guide to Detecting and Preventing Fraudulent Activity
One of the most common forms of affiliate fraud is bot traffic, which is generated using a program designed to mimic human interaction. This type of fraud is most common in affiliate programs that reward marketers for views, hits, shares, likes, and visits. Bots can also generate fake conversions and falsify form submissions.
Another common type of fraud is domain squatting, which occurs when fraudsters register variations of an authentic website and redirect traffic to their own site. The fraudster’s site is often a clone of the authentic site, featuring identical visuals and wording. Fraudsters can then claim commissions on fraudulent sales and lead generation activity.
Finally, affiliate fraud can also be a result of cookie stuffing, which involves dropping fraudulent cookies on users’ browsers. This can be done by a competitor seeking to sabotage an honest affiliate or by fraudsters who seek to artificially inflate sales and conversion rates.