What is Affiliate Fraud and what does it actually mean? Affiliate fraud for me isn’t the same thing as most people would consider it.
Most companies consider Affiliate fraud when an Affiliate sends bad and false leads or incentivizes traffic to shop then return goods within the return period after they have already been paid, then those Affiliates move on to the next Merchant and offer. Other Merchants consider using co registration Affiliate Fraud if the end user is being incentivized to fill out forms or sign up for services with no intent to buy in order to win a prize or get cash back or something along those lines. Other times Affiliate fraud is clear cut as Affiliates using stolen credit cards in order to place sales and hope they get paid in between the time the person finds out their card has been stolen and their checks from the Affiliate Networks can be cashed. Although I do agree that much of that can and should be looked at as Affiliate Fraud, for me the real Affiliate Fraud is along the lines of how sales are being generated for the Merchants.
Most Merchants still haven’t realized how their sales are being generated. They see the website listed or the Affiliate who claims to be a PPC or other type of Affiliate and assume all is well, especially because they trust the Network they are on and the Network may have recommended that Affiliate as a good partner. That is the problem, trusting Networks and trusting Managers and some Outsourced Affiliate Management Companies.
I recommended things to think about when hiring an Outsourced or Part Time Affiliate Manager or what to think about and ask when you hire an in house Affiliate Manager or what to expect and what you should expect from your Outsourced Affiliate Program Management Company. These articles more than hold true in that if they don’t know about adware, if they don’t know about spammers and if they don’t know about parasites, they cannot help you find or control fraud in how a sale was driven to your site or claimed by someone already on your site.
The way I see another form of Affiliate Fraud (besides bad leads and stolen credit cards) is through adware applications that that set cookies on your site directly to take credit for sales and customers that you already had on your site. Many Networks promote and endorse this behavior and because they don’t educate the Managers or Companies on how this works or happens, the Merchants have no clue what to look for or don’t even think about it since they don’t know to which is why I post about Parasites and Adware on a regular basis and why I always refer people to Kellie Stevens at Affiliate Fair Play.
Allowing or having Affiliates pop ads over or use adware and toolbars or loyaltyware, couponware, etc… to set cookies when people are already on your site regardless if they found you through other Affiliate sites, through your own paid for PPC, through your own email newsletters and other forms is not acceptable (at least in my opinion). Even though the end user opted in, you brought that consumer back and you kept them on your site and closed the sale, not the parasite who is taking credit for the sale, so why should they get paid for a stolen customer or for stealing from another Affiliate? They shouldn’t. That is why to me that this is also a form of Affiliate Fraud.
By setting a cookie on someone who found your site without going to their site for the original referral to your site or services is (in my opinion) not legit and because they would have shopped on your site regardless of the adware, that is where it is fraud. They claimed a sale that you would have gotten regardless and you now have to pay out a commission on the customer you already had which in my book is Affiliate Fraud. Anyways, with all of the talk about PPV being a good thing and toolbars being owned and operated by certain Affiliate Network parent companies, I wanted to share another form of Affiliate Fraud that most people don’t think about because they do not know to think about it.
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