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The Art of Fraud: How to protect your business against fraud in affiliate marketing?

Even though you only pay for achieved results in affiliate marketing, such as selling goods, installing applications, filling out forms, etc., in practice, you can still encounter fake orders, bot traffic, and other types of fraud. On this page, we’ve collected all the main types of fraud and shared ways to protect your business from it to negate any negative consequences.

Note: Travelpayouts has 10 years of expertise and uses advanced anti-fraud technology to fight fraudulent activity. Our platform is safe for partners and travel brands. For security reasons, in this article, we do not disclose the details of how we detect and combat fraud. For more information, you can contact your personal manager or reach out to the Business Development team.

Types of Fraud in Affiliate Marketing

Fraud in affiliate marketing refers to deliberate fraudulent activity aimed at making a profit while violating the terms of an affiliate program. As a result of such actions, the brand, the affiliate network, and other bona fide partners all suffer.

The most common types of fraud in affiliate marketing include:

  • Brand bidding in Google Ads (or other contextual networks)

A number of brands, such as RentalCars, prohibit partners from purchasing contextual advertising that mentions the brand name (brand bidding). Such purchases by partners artificially raise the prices for advertisers in Google Ads, while the brands themselves, as a rule, successfully purchase such traffic without involving partners.

Not all brands prohibit brand bidding in contextual ads. In this case, when a specific traffic type is allowed, this practice is not fraudulent, as it helps brands get sales or achieve other desired results.

Brand bidding is one of the most frequent advertising violations within the Travelpayouts affiliate network. Thankfully, this is a fairly easily identifiable and preventable problem. As a rule, little time is spent identifying and solving this problem.

  • Cookie stuffing

In affiliate marketing, cookies are typically used to track sales. Thanks to this technology, brands credit partners with sales over long periods. For example has a 90-day cookie lifetime. In some cases, only sales in one session are counted, such as on

Unscrupulous partners “replace” real cookies with their own. As a result, for the brand, it looks as though this partner attracted the sale. Cookies can be spoofed in various ways, including:

  • Browser extensions: For example, unscrupulous Chrome extensions can automatically add cookies to all sites.
  • Installing an Invisible iframe: This will load the advertiser’s site and set the cookie file.

Both brands and partners suffer from cookie stuffing. The creators of travel content and other conscientious partners invest effort and money into the development of their projects, create a community, and help tourists organize trips. As a result of cookie stuffing, their sales can be credited to an unscrupulous partner.

  • Motivated or bot traffic

Motivated traffic differs from real traffic in that the audience does not take action of their own free will. For example, an affiliate promises a reward (usually small) for performing an action on a brand’s website.

In the case of payment for the actual sale, this method does not threaten brand results, but when paying remunerations to partners for other actions (clicks, filling out a form, downloading an application, etc.), motivated traffic may harm your affiliate strategy. Motivated actions typically do not lead to the desired result for the advertiser. After receiving 100 downloads of the application or 100 completed forms, it is impossible to work with them, since there are no potential customers.

In some cases, partners attract fake people and use bot traffic to set up special scripts that click, download, and imitate other actions. The result for the advertiser is the same. There are actions, but no actual result from them.

  • Substitution or use of prohibited traffic sources

Each brand accepts traffic from specific sources, such as social media and travel blogs. At the same time, most brands have a list of sources from which traffic is prohibited, such as pop-ups or doorways.

Unscrupulous partners can technically hide the original source and disguise it as a legal one. For example, unscrupulous partners can buy low-quality traffic and disguise it as an allowed type.

  • Other

Other fraudulent options in affiliate marketing are rare in practice, but nevertheless exist.

Sometimes, partners do not use fraud, but still violate the rules. In some cases, these violations are not even intentional. For example, an affiliate goes through moderation with one site, and then drives traffic from another site that does not fit the conditions or offers its audience booking coupons that are prohibited by the terms of the affiliate program.

In practice, some fraud is carried out by bona fide partners and, in fact, may not even technically be fraud, but an unintentional violation that happened by mistake. For example, an affiliate may not take into account the specifics of brand mentions or understand other conditions of the affiliate program.

The good news is that fraud or rules violations can be minimized and, if they occur, can be recognized and stopped without any loss for the brand.

How to Detect Fraudulent Activity

Abnormal statistics often indicate fraudulent activities, such as significantly higher conversions rates than average for the segment. The internal Travelpayouts system received information about all impressions, clicks, sales, conversions, and other events across the platform. The system uses:

  • Bots that automatically send signal anomalous activity. Bots serve to identify problems in the moment. In addition to standard criteria, such as a large difference in the conversion rate of an affiliate from the average in the segment, using artificial intelligence can discover massive fraud as well as minor private violations of the rules. Artificial intelligence detects suspicious bookings using a number of criteria, such as specific entry dates and other parameters.
  • Reports that are automatically generated include more detailed information, which is suitable for dynamic studies and investigations.

These analytics tools are used to identify low-quality traffic and other violations.

An example of situations that signal possible violations:

  • In the case of iframe traffic, a conversion may reach ~1/30,000. This means that cookies from the advertiser have been set for the entire audience, but the audience isn’t the target audience.
  • In the case of toolbar traffic, the total number of orders is growing, but the conversion from other sources is falling. This happens due to the fact that all orders from browser extensions unreasonably take away part of the orders from other sources.
  • In the case of bot traffic, there are different boilerplate behaviors on the site, as well as the same type of emails/short user lifetime, etc.

Important: An anomaly (a difference in indicators from normal ones) is not always fraudulent. A loyal audience, a big sale from service providers, and other cases can create conditions for an objective increase in conversions and other fraud indicators.

A dedicated team at Travelpayouts is engaged in investigating violations and monitoring the quality of traffic. In some cases, the investigation requires the involvement of the brand (for example, conducting background checks).

How to Defend Your Business?

The fight against fraud begins even before the launch of the affiliate program. When connecting to Travelpayouts, you need to evaluate the subtle aspects of your product and take this into account based on the terms of the affiliate program. For example:

  • Easy cancellation of orders after payment
  • Transition of orders to the “Paid” status before your company actually received money in the bank account

For each of these points, it is necessary to work out a solution that will negate the risks. For example, you can introduce a rule that payments are only provided for orders after the service is actually used, as most hotel affiliate programs do. A period that is set for processing a paid action is called a “Hold”. The hold period is set so that, after receiving the target action, the brand has time to check.

When connecting to Travelpayouts, each brand receives a special guideline, which makes it possible to revise all terms. As a result, well-thought-out terms and conditions can be developed for each affiliate program, which reduces the number of possible fraud options and protects brands from fraud.

Pre-moderation of partners allows brands to reduce the risks of fraud as well. However, manual moderation of partners never provides a 100% guarantee, but significantly reduces risks. With this model of work, it is important not to go to extremes and approve only very large websites, since there are many site owners with high-quality audiences among small partners, which will give your business the results you need.

When any partner joins your affiliate program, regardless of whether you have no moderation or very strict moderation, there is always a risk of violations or fraud. Analytical tools and the Travelpayouts team allow you to control the quality of your traffic as well as promptly identify and suppress contextual advertising violations, including brand bidding.

Along with the quality of traffic, we take care of the experience of using our products from the partner side. The Travelpayouts support team never leaves a partner to deal with controversial issues on their own.

In any case, we take a neutral position and are ready to consider all the information provided. We, at Travelpayouts, do not practice unreasonable litigation or unreasonable blocking of partners. In each disputable situation, a support agent is assigned to the partner, whom the partner can work with to resolve any issue by providing the necessary information. You can learn more about the principles of working with partners in cases of detected fraud in this article.

There is a possibility of fraud in CPA and affiliate marketing, but it can be effectively dealt with in various ways:

  • Well-prepared rules and conditions of the affiliate program;
  • Artificial intelligence to detect abnormal activity;
  • Instant notifications about identified problems;
  • Detailed reports;
  • Quality control analytical team;
  • Dedicated support team to resolve any disputes.

Fraud and fraudulent attempts are integral parts of affiliate marketing. Modern solutions allow you to effectively deal with any type of fraud, receive only high-quality traffic, and, as a result, achieve the necessary goals of your business. Your next step towards getting quality traffic is to launch your travel brand’s affiliate program on the Travelpayouts platform.