What Role Does Click Fraud Play in Affiliate Marketing?
In the digital age, it has never been easier to make money online. Unfortunately, since criminals tend to go where there’s money to be made, a number of them have figured out how to game the system, so to speak, and steal big dollars out of advertisers’ pockets.
One way they’re doing this is by committing affiliate click fraud.
What is affiliate click fraud?
Affiliate click fraud occurs when a bad actor signs up affiliates to drive traffic for a particular campaign instead of going to Google to buy legitimate traffic. The idea here is simple: Fraudsters know they are going to get paid every time someone or something clicks on an ad. Since it’s generally harder and more expensive to drive traffic the right way, crooks are always on the lookout for a shortcut.
That’s where affiliate ad fraud enters the equation. By making it look like many more people are clicking on ads, fraudulent affiliates can generate more and more dollars from publishers and advertising networks—dollars that come out of the advertising budgets of companies like yours.
How does click fraud affect affiliate marketing performance?
There are a number of ways affiliate click fraud impacts the performance of your campaigns—and unless you’re a glutton for punishment, none of them are good.
First and foremost, affiliate click fraud—when executed successfully—will extract a certain amount of money from your ad spend every day through fraudulent clicks. Believe it or not, Juniper Research predicts that ad fraud damages will eclipse $100 billion by 2023, meaning that this problem is only expected to get worse over time.
When someone is gaming the system and sending invalid traffic (IVT) your way, you’ll end up with distorted data on the other side. This makes it nearly impossible to figure out how effective your campaigns are, whether your conversion rates are where they should be, and more.
Wasted future ad spend
When you make decisions based on data, those decisions will only be as good as the quality of the data you analyze. In other words, when you start off with bad data, you’re going to make the wrong decisions.
In this light, affiliate click fraud also means you’ll waste more of your future advertising budgets on fraudulent traffic. This is why it is so important to identify whether you’re the victim of this kind of fraud as quickly as possible. Not only does that enable you to make sure you’re keeping more of your budget, it also means you’ll be able to put more faith in your data—and more faith in your campaigns moving forward.
Daily limits reached faster
Assuming your budget isn’t infinite, there’s a good chance you’ll put a daily limit on your campaigns. When you’re the victim of affiliate click fraud, you’ll reach those limits much faster. Not only will your competitors’ ads get more views, at least some potential prospects will not see your ads, which could take a chunk out of your bottom line.
Potential TCPA violations
If you have a campaign geared toward lead generation and you enlist the services of a company to help you get form fill-outs, you may find out the hard way that you’re the victim of affiliate fraud and that the leads you end up with aren’t worth the pixels they occupy on your computer screen.
Even though you might not think you’re a telemarketer, if you call a lead that you’ve collected this way—and that lead was not someone that actually filled out the form themselves—you might be guilty of violating the Telephone Consumer Protection Act (TCPA). The TCPA is a law designed to make sure that folks don’t keep getting calls from telemarketers.
If a bad actor routes fake leads your way, but those leads include real-world information (e.g., names and phone numbers), you might be guilty of a TCPA violation. That’s nothing to take lightly, because a single violation could result in a fine as high as $1,500.
Related Post: 6 Tips for Crafting a Fraud-Resistant Affiliate Marketing Campaign
How does an ad fraud solution help?
The good news is that you are not entirely powerless against this problem. In fact, a simple investment in an ad fraud detection and prevention solution can go a long way toward protecting your organization against affiliate fraud—and enabling you to enjoy better campaigns because of it.
With that in mind, here are four ways ad fraud solutions can help you prevent fraudsters from taking your hard-earned money.
Understand where all your traffic is coming from
The sooner you know where your traffic is coming from, the faster you’ll be able to tell whether you’re a victim of affiliate fraud. Leading ad fraud solutions make it abundantly clear where traffic is coming from, which makes it easier for you to develop a plan about how you can defeat the fraudsters who are affecting your campaigns in a bad way.
Prevent bad traffic from accessing your systems
Knowing where your traffic comes from can help you identify fraud. As an example, if you’re trying to attract customers who live in the United States and are consistently getting forms filled out by IP addresses located on the other side of the world, it might be an indication that affiliate fraud is hurting your campaigns.
With the right ad fraud solution in place, you can block these bad actors with the confidence of virtually zero false positives—which means that you won’t block anyone you want to attract.
Protect every last penny in your budget
In the world of digital advertising, every penny counts. Leading ad fraud solutions enable you to protect every last penny in your budget by identifying whether bots, malware, or human fraud are spearheading fraud attacks against your business. You’re protected from automated and human-influenced affiliate marketing fraud attempts, making it that much easier for you to accomplish your objectives.
Future-proof your campaigns
After you implement an ad fraud solution and begin warding off fraudsters—and the bots, malware, and human fraud they rely on—you will get better data from your campaigns. That data will help you devise increasingly more effective campaigns, which will result in even better data, all of which will drive a continuously improving cycle.
Won’t the fraudsters keep devising newer and newer methods? Absolutely.
With the right solution in place, you’ll have access to technology that is constantly updated to stay a few steps ahead of the bad actors—essentially enabling you to future-proof your campaigns.
Ready to learn more about affiliate marketing fraud?
Affiliate marketing fraud is a massive problem for business in all industries, but it’s a problem that’s possible to defeat. To do that, you first need to understand everything you can about the ins and outs of affiliate marketing fraud and have a . Once you have that understanding, you can then take steps to start solving the problem.
For more information on affiliate fraud and how it affects businesses, check out our free e-book, Affiliate Marketing Fraud 101.