Affiliate fraud prevention is an important part of any online marketing strategy. It can result in huge chargebacks and loss of credibility if it isn’t stopped. The key is to use the right tools and implement fraud-prevention measures into your campaign to minimize the risk of fraudulent activity.
The most common affiliate fraud tactics involve stealing traffic, sending bad or fake traffic, and using bots to trigger commission payments. These techniques can be very difficult to detect, so it’s important to be on the lookout for them in your program.
Fraudulent activities can take the form of a wide range of fraudsters, including cloned websites and domains, spoofing, click spam, and more. Some of these tactics are more sophisticated than others, so it is crucial to be able to detect them all.
Domain squatting is a major form of affiliate fraud, where scammers register variations of a vendor’s domain and set up their own clone website to divert traffic away from the legitimate affiliate. Customers will make purchases on the clone site, which can cause a merchant to lose sales and revenue.
Cookie stuffing or spoofing of traffic is another common type of affiliate fraud. This method involves placing a tracking cookie on all visitors to a website, regardless of whether or not they actually buy anything.
One of the easiest ways to spot these kinds of attacks is to monitor for spikes in sales made by a single IP address. This is a strong indication that a fraudulent individual is making all of these purchases and should be monitored closely.
Conversion rates are another common indicator of affiliate fraud. If an affiliate’s conversion rate is significantly higher than other partners, this can be a sign that they are engaging in fraudulent activity.
In addition, if an affiliate is converting leads with ease, but then a few days later starts filing disputes about their commissions, this can also be a red flag. This is because these types of claims often take time to process, and may indicate a scam affiliate.
Paying only on completed sales is another safeguard against fraud. Affiliates should only be rewarded for sales that have been verified and approved by the program manager. This allows you to track which offers are valid and those that haven’t been authorized.
A new affiliate who’s a member of your program should be thoroughly vetted and monitored for suspicious activity at all times. This requires performing background checks, email verification, and due diligence questionnaires before onboarding. It’s also a good idea to maintain regular contact with the affiliates you work with, and conduct ongoing reviews and assessments of their performance.
Fraudsters are constantly coming up with new schemes to get around your protection safety measures, so it’s important to stay on top of trends that appear in your analytics and reports. These trends will help you catch them before they escalate to major problems.