Affiliate fraud is becoming extremely profitable for black hat marketers at the expense of reputable advertisers. In fact, a study by Atrinsic Interactive reported that an average of 40% of misattributed revenues per advertiser is common. Translated, this means that on average, 40% of revenues generated from affiliate campaigns are due to fraudulent tactics. Forms of advertiser abuse to look out for:
This is a popular black hat technique that entails bidding on an advertiser’s or competitor’s brand name and/or relevant trademark terms. Fraudulent affiliates will use this to their advantage to lure users to their landing page, oftentimes with misleading ad copy about fictional special offers. This also causes problems for advertisers when they run their own campaigns and are forced to bid against other marketers for their own brand name. Not only does this drive CPC costs up, but this exploits brand names for ill-gotten gains.
Also referred to as URL hijacking, direct linking is a measure of bringing in targeted users by using the advertisers’ web address as the displayed URL in search ads. When clicking through, users bypass publisher landing pages and are directly sent to the advertiser’s page. The issue with this tactic is that fraudulent ad copy over which the advertiser has no control can be used to deceptively lure in traffic.
In severe cases, affiliates will assume the identity of advertisers to leech off their brand equity and sell counterfeit goods. This nefarious tactic results in deceitful transactions that can have a devastating effect on the overall brand equity. Brandjacking can be disastrous for advertisers because there is absolutely no control over how their name is used and must suffer any consequences derived from these fraudulent schemes.
How can advertisers mitigate the risk of advertiser abuse?
Monitoring all brand activity in the online environment is a must, with special care given to the actions of your publishers. However, this may be difficult with performance marketing networks where transparency is still an issue. Enabling strict guidelines forbidding any black hat affiliate marketing technique will also reduce risk and provide you with a platform to protect your image. Despite the inherent dangers prevalent in the industry, a formidable plan of action to prevent advertiser abuse and affiliate fraud can be the launching pad for a successful campaign.