Affiliate marketing fraud is a type of online fraud that occurs when an affiliate publisher, also known as an affiliate marketer, uses malicious or deceptive tactics to earn a commission from an affiliate program.
As the affiliate fraud threat grows, marketers need to be more vigilant in the ways they identify and prevent it. Here are four ways to help you spot and eliminate affiliate marketing fraud. By taking steps to protect your program, you can help to ensure that your affiliate marketing efforts are successful.
Monitor Your Mean Time to Conversion Data
Time passes between when a user clicks on a link and when they transact. The metric “mean time to conversion” calculates the average time your buyers took to complete their user journeys.
Naturally, there is a significant amount of variation in time to conversion for individual users. But take a look at your average time to conversion by your affiliate partners. When you do this, you will likely find that many of your affiliates have similar or slightly varied mean time to conversion. Of course, some variation is perfectly normal. Further, larger variances are more likely for partners and placements that drive relatively lower volume and a signal for affiliate marketing fraud.
Monitor Affiliate Publisher Conversion Rates for Affiliate Click Fraud
Many people who click on a link don’t end up converting. A conversion rate divides the number of conversions by the number of clicks to determine the average percentage of people who end up making a purchase. Publisher conversion rates calculate this metric for the clicks and purchases driven by each partner. Again, there will be natural variation in those figures. But if you see one or a few partners with significant click volume but extremely low conversion rates, it may be a sign of possible click fraud.
Affiliate marketing click fraud means an affiliate marketer artificially inflates their reported clicks. It is most likely to occur in CPC programs or an affiliate program where an advertiser pays for specific “real estate” on an affiliate partner’s website — like a top feature position.
Monitor Conversion Rates By Placement or IP Address for Creative Fraud
Here you take a look at the rates for different placements — like a specific web page. Abnormally high conversion rates can be indicative of creative fraud — in which fraudsters alter your messages.
While sample sizes for individual placements can be quite small, the ability to click a link and instantly see the creative at a specific location can offer immediate evidence for or against fraud. Remember also that low traffic placements are less likely to be fraudulent because a bad actor is unlikely to go to all the bother for a small payout. Where fraudsters reveal themselves is in a combination of peculiar data and significant volume or scale.
Monitor Traffic By URL for Cookie Reuse
Digging into where your affiliate traffic comes from can help you spot cookie reuse and unauthorized placements. What you’re looking for here are large numbers of clicks associated with particular URLs — scale makes this fraud economic for the fraudster.
Many of your highest traffic URLs are going to be from your largest affiliate partners. That’s totally normal. What you are looking for here are the URLs that aren’t associated with a legitimate partner, or where the traffic levels generated are out of sync with the expected scale offered by an affiliate partner.
The four tips covered above are both simple to understand and provide strong indications that specific elements of your programs warrant investigation. Over time, you can identify if there are specific elements of your programs that seem to be under threat.
Remember also that data anomalies are reason for investigation, not accusation. Shared data and analysis are a great way to collaborate with great partners for even greater results. Together, you can work to ensure faster growth and higher return on investment.