As affiliate fraud detection is on the rise and costs businesses up to 65% of sales, it’s crucial that merchants understand the different tactics fraudulent fraudsters use. This article will give you a closer look at how affiliate fraud operates, what types of fraud to look out for and methods for detecting and preventing it.
Click Fraud: This includes activities like cookie stuffing, incentivized traffic and other manipulation techniques to generate fake clicks. It’s important to keep a close eye on the number of clicks and conversions your affiliates are producing to detect any abnormal spikes or dips in performance.
Cookie Stuffing: Fraudsters intercept affiliate tracking codes to replace them with their own. This allows them to steal commissions from their affiliate program partners by generating fake website visitors, form submissions and purchases to earn illegitimate sales.
The Art of Affiliate Fraud Detection: Tools and Techniques to Safeguard Your Business
Incentivized Traffic: Fraudsters posing as affiliates will incentivize their audience with rewards, such as free products or discounts, to drive artificially high numbers of site visits and clicks. This can be a major problem for marketers, as it may lead to a higher-than-usual number of chargebacks from users who are trying to take advantage of the offer.
It’s also important to set strict acceptance criteria for your affiliate programs, as a rigorous application process will help identify any unscrupulous affiliates. You should have a strong verification process that requires users to provide proof of identity, address, and banking information before becoming an affiliate. It’s also a good idea to leverage automated tools that can act as an affiliate watchdog for you, detecting suspicious activity and alerting you so you can take action.