Five Ways to Safely Manage Your Affiliate Marketing
Earlier this year, we identified a spike in affiliate fraud. It happened right after the holidays as online purchases soared. Affiliate fraud refers to any false or suspicious activity to generate commissions from an affiliate marketing program. It’s an issue no one wants to ever have to deal with, but when it happens, it must be addressed quickly. Usually, it stems from the merchant not doing the proper due diligence or a hiccup in affiliate fraud reporting. Many of our subscription programs have recently seen a surge in new affiliate traffic as more card brands focused on tube sites. Merchants that relied on the tube advertising went back to affiliate marketing. To help keep us all accountable, this month we break down the top five best practices to manage affiliate traffic.
Get the 4-1-1
Back in the day we dialed 4-1-1 to get information and now is a great time to get dialed into our affiliates. Knowing Your Customer or KYC is important. You need to have a consistent and organized on-boarding process. This is one of the easiest and most effective methods for a merchant to prevent affiliate fraud. We encourage our clients to “get to know” their affiliate marketers during their on-boarding process. This can be done by simply confirming banking information, receiving a physical signature on the marketing agreement, and collecting a copy of the partner’s physical identification. This small bit of due diligence can save merchants from having to pay large fees to acquirers and protect the integrity of their business.
Follow the Footsteps
Webmasters can make a big difference by tracking, verifying, and monitoring all partners in their affiliate program. By looking beyond, the conversion rates of marketing partners and deeper into trackable data, merchants can uncover warning signs of fraudulent activity. We suggest regularly monitoring things like login rates, abnormal behaviors in transaction data, inconsistencies in affiliate geolocation, large average ticket prices via revenue share models and unregistered URLs.
It is always a good idea to take a deeper look at affiliate traffic sources and content. You will want to monitor the sources for referral traffic from affiliates as well as reviewing the digital ads affiliates are using to generate traffic to merchants’ sites. The content of your affiliates must meet the card brand’s protection policies; Mastercard’s Business Risk Assessment and Mitigation (BRAM) Program and Visa’s Global brand Protection Program (GBPP). If your affiliates have brand damaging content that they are using on their webpages and marking it to your site, you will be held accountable for the affiliate’s content. You could face fines or worse, loss of service. Pay close attention if you are marketing off tubes or market a premium tube site. Tube traffic is usually user-generated and unmonitored, making it easy for content that violates the card brand policies. If the content on the tube site is not compliant and links to a premium program, the premium program is held accountable.
Red Flag Warnings
Pay close attention to customer service issues. Things like increases in reported fraud by consumers or chargebacks on a site should be considered red flags. These are clear identifiers for eCommerce merchants that there might be fraudulent partners within their current marketing network.
Pay Ya Later
Merchants should delay payments to marketing partners. This is helpful in preventing fraudulent affiliates from infiltrating a system for a few days, collecting the money, and jumping ship before activity can be detected.
It is important for webmasters to remember that the more they know about affiliate marketers upfront, the lower the risk will be of introducing fraudulent affiliates into the system. We require that our webmasters share their affiliate IDs so we can help them identify current or new affiliates that have potential fraud risks. We provide this ongoing service free of charge to our clients. Affiliate marketing is still an efficient way to do business and an easy way it increases sales but taking the time to manage your affiliate marketing is critical. As I’ve said before, the best defense is a strong defense. Apprehensive about where to start? We can help authenticate your affiliates just reach out at [email protected].