Avoiding Fraud in Your Affiliate Programs
By Rob Wood
Sun, 16 Oct 2005, 23:41:00
An unfortunate problem with doing business online is the issue of fraud. Fraud has a huge impact on even the largest companies but there are many things you can do as a Merchant to minimise and even eradicate fraud in your program. This tutorial will take you through the basics of fraud prevention and a few of the tricks you can use to avoid it. It will also take a look at the different types of programs and how fraud can be prevented in each one.
Not all program types are created equal when it comes to fraud. clixGalore's strength lies in its Per Sale and %Sale programs and coincidentally these types of programs are also the safest from Affiliate fraud. The reason for this is that the Merchant doesn't pay out to an Affiliate until AFTER a sale has been made. This makes great sense from both a business perspective and also from an anti-fraud perspective. This model is so successful in preventing fraud that most clixGalore Per Sale and %Sale Merchants have never experienced an instance of Affiliate fraud. However, Merchant websites are still susceptible to credit card fraud (which is outside the power of any Affiliate network to control). Most payment gateway providers and banks offer relevant fraud prevention techniques to counter people using false credit cards. The good news is that if your payment gateway provider does let through a fraudulent order, you can contact clixGalore and ask them to reverse the commission for it.
There are many precautions that Merchants with Lead Programs (PPL) can and should take to avoid fraud when setting up their accounts with clixGalore. Allowing only targeted traffic from the area in which you require leads will eliminate a lot of potential fraud. Lead Merchants should also consider accepting (manually) only Affiliates from their own country also ĘC another function that clixGalore allows to be automatically set. Finally leads should be manually verified before they are approved by the Merchant ĘC this avoids the problem of people filling out the lead forms with false information or gibberish. More advice for lead programs can be found at clixGaloreTutor tutorial called "Tips for Lead Programs."
There are also several steps that Per Click (PPC) Merchants can take to help keep their click program as fraud free as possible. Geo-targeting clicks from the most relevant geographic location is a good start. For example most English speaking programs will have absolutely no use for traffic from non-English speaking countries. It is therefore a good idea to exclude those countries. It is also unlikely (though not unheard of) that Affiliates from a non-English speaking country will be able to deliver quality English speaking traffic. Merchants should therefore carefully decide on which Affiliates to allow into their program. Fortunately clixGalore allows Merchants to manually vet any Affiliate application to your program. Merchants should also be diligent in tracking where their clicks are coming from. clixGalore will not allow two clicks from the same IP address in a 24 hour period which largely removes the problem of a person repeatedly clicking on an ad simply to get commission for it. Merchants should also be wary of Affiliates with unrelated sites who are sending through a lot of traffic as unrelated sites with PPC advertising generally doesn't have a good click through conversion rate.
That about covers the main steps to be taken by each of the program types in preventing fraud. In general, there are a few rules for Affiliate Programs that, if followed, can largely cut out fraud. Merchants should always vet their Affiliate applications manually before allowing an Affiliate to join their program. PPC and PPL merchants should geo-target both their traffic and the Affiliates they allow to join their program. All Merchants should MANUALLY verify sales and leads to make sure nothing suspicious is occurring. After a few weeks the level of diligence required starts to decrease as the Merchant becomes comfortable running their program and gets to know their Affiliates. A little diligence when setting up a program, however, can avoid heartache further down the track.
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