Protecting Your Business from Fraudulent Affiliates
Affiliate networks help bring traffic to their merchants’ sites by using publishers’ or affiliates’ websites to achieve this goal. The affiliate basically acts as gateway for its visitors from their site to the merchant occupying the affiliate’s ad space. Typically, the affiliate gets paid by the merchant, through the affiliate network, and based on the consumers’ actions upon visiting the merchant site. Whether the visitor needs to sign up for a weekly newsletter, purchase a certain item, spend a certain amount of time on the site, or simply click on the link, if the agreed upon action is executed, then the merchant owes a check to the affiliate when it comes time to reconcile their payments.
It’s virtually impossible for affiliate networks to linger over the shoulder of each and every affiliate to whom they pay, but, at the same time, it has been reported that about 2-3% of the transactions made via affiliates are fraudulent. If this is the case, then those numbers can add up quite quickly. Well, let’s be real: even one dollar falling into the hands of a fraudulent affiliate is frustrating, and with the amount of online activity that takes place in today’s society, merchants stand to lose a lot of money due to fraudulent affiliates. As we’ve covered in the past, there are many different techniques that fraudulent affiliates utilize in order to push up their earnings, including click fraud, cookie stuffing, typo squatting, and many other techniques.
The key to reducing fraudulent affiliates is to incorporate an enterprise-class Risk Management Module, such as the one offered by our team here at Tipalti, which is able to alert customers of previously detected fraudulent affiliates within the Tipalti network,. This feature makes these fraudsters visible within an affiliate network, therefore preventing serial fraudsters from pulling and repeatedly causing your affiliate network to loose valuable time and money.