All companies that implement affiliate marketing into their advertising mix rely on this approach to generate quality leads in a cost-effective way. Nevertheless, there are dozens of variables that impact the quality and overall validity of leads generated online. Moreover, there are deceitful entities that aim to perform click fraud, generate false conversions, and take advantage of unsuspecting businesses that don’t monitor their affiliate programs closely enough.

With this in mind, there are steps you can take to protect your affiliate program against click fraud. Our team at lemonads has implemented a variety of protection methods to safeguard our partners from fraudulent clicks and other forms of fraud, so we know what steps need to be taken to secure an affiliate program.

In this article, we will go over the definition of click fraud, the different types of fraudulent activities that fall into this category, how they affect your program, and what you can do to protect your program from fraudsters.

What Is Click Fraud?

Click fraud is a term used to describe a wide range of fraudulent activities that are performed by different deceitful entities. In simple terms, click fraud can be defined as any malicious interaction that results in a charge for an advertiser without providing any value in return.

When you develop an affiliate marketing program, the main goal is to collect information from prospects and leads in order to transform these users into customers later on. Unfortunately, when click fraud occurs, advertisers end up collecting invalid information that doesn’t translate into qualified leads or sales.

In its most basic form, a fraudulent click refers to an illegitimate interaction between a “user” and an ad, but this type of malicious interaction can occur in different parts of the affiliate ecosystem.

In the affiliate advertiser context, fraudsters attempt to submit leads that seem to come from reliable channels, when in fact, the information collected is either not real or inaccurate. When advertisers are not aware of the fraudulent interactions, they pay for the invalid leads and continue partnering with the dishonest provider.

Click fraud can be performed by real human users or bots, which are pieces of software that mimic the way real users behave on a computer or smartphone. With the above in mind, it’s important to note that click fraud doesn’t simply happen, there is always an entity behind illegitimate interactions.

Does Click Fraud Affect Your Program?

Before delving any further, it’s important to note that there’s a difference between fraudulent interactions and unwanted clicks.

“Unwanted clicks” is a term used to describe interactions that don’t deliver value to advertisers, but don’t come from malicious parties either. For example, if your program is not structured correctly, your affiliates may end up attracting irrelevant traffic that you still have to pay for. Click fraud, on the other hand, is always performed by a deceitful organization or individual and the main goal of this activity is to extract money from unknowing stakeholders.

Click fraud usually targets a specific advertiser, so this deceitful practice can have a huge impact on the company’s partner program. Some of the negative effects of click fraud on an affiliate program include:

Exponentially Increases Conversion Costs

The first and most obvious downside of click fraud is that it exponentially increases conversion costs. Keep in mind that this isn’t immediately obvious because fraudulent clicks appear to be valid interactions at first, which is the reason why advertisers end up paying for them.

But, when businesses start reviewing the conversions and testing their validity, the fraudulent interactions prove to be useless, thus increasing the cost of the real lead that’s generated.

Depletes Your Marketing Budget

Besides inflating the cost of your conversions, click fraud is detrimental because it depletes your marketing budget without providing anything in return. Remember, one of the main benefits of affiliate marketing is that it’s performance-based. Therefore, if a company isn’t receiving valid leads while paying out commissions for each conversion, it’ll be impossible to generate a positive return-on-income (ROI) from the investment.

Provides Misleading Statistics

As if depleting your budget and skyrocketing conversion costs isn’t enough, fraudulent conversions also provide misleading statistics. This in itself creates a huge set of problems, but the main one is that it makes advertisers feel that their programs are working, when in reality they are not receiving any bang for their buck.

Fools Companies Into Wasting Funds

It’s one thing to sway the program metrics, but remember that many businesses invest a serious amount of money into optimizing their programs and adjusting the resources they provide to affiliates. For this reason, companies that constantly receive fraudulent traffic are more likely to waste funds by making improvements based on inaccurate data.

As with the other disadvantages, this isn’t apparent right away, so many businesses optimize their affiliate programs once or even multiple times using deceitful data. This, in turn, hinders the performance of the program even more because it tends to attract even more fraudulent traffic.

It Impacts Consumers and Publishers As Well

Most advertisers that are aware of click fraud only focus on protecting their programs. But, the truth is that click fraud affects the entire advertising ecosystem, especially consumers and trustworthy content publishers.

Consumers are now used to personalized online marketing experiences, but high volumes of click fraud disrupt the way the ecosystem works. So, rather than tailored ads, consumers start seeing irrelevant content that ultimately has a negative impact on the way they feel while browsing the internet.

Moreover, reliable content publishers are under a huge amount of pressure to implement security features and keep up with fraudsters. But, not all publishers have the budget to leverage top-notch fraud protection, which limits the monetization schemes they can have in place.

How to Protect Your Affiliate Program From Click Fraud

According to some projections, click fraud will cost the entire marketing industry a whopping 50 billion US dollars yearly by 2025. To avoid this, all stakeholders in the industry must take action and protect their efforts against fraudulent entities, including advertisers.

Let’s take a look at the steps you can take to protect your program from fraudulent conversions.

Study the Buyer’s Journey

All knowledgeable marketers know that the buyer’s journey allows businesses to map out the steps that their customers take before making a purchase. But, the buyer’s journey also holds the key to learning how to differentiate fraudulent interactions from legitimate conversions.

Whether it’s performed by bots, real people, or a combination of the two, deceitful interactions don’t follow the same behavioral pattern as legitimate clicks. If you understand the buyer’s journey well enough, you’ll be able to help your anti-fraud mechanism by applying additional filters that reduce deceitful interactions.

Implement Traffic Validation Tools

Now that you have a clear understanding of how your legitimate audience members behave, you can start researching traffic validation tool alternatives. As the name suggests, a traffic validation platform allows you to check if the conversions generated by your affiliates come from legitimate sources.

There are many alternatives available, so there is no exact formula to find the best platform. You simply have to research the different providers, compare their features, and figure out which one is the better fit for your affiliate program.

Support Initiatives that Want to Create a More Transparent Internet

The Trustworthy Accountability Group (TAG) is one of many global initiatives that have pledged to combat ad fraud on the internet. Advertisers and other stakeholders should actively seek to join these initiatives and participate in any activities designed to reduce instances of fraud or create a more transparent ecosystem.

Share the Message Internally

Fraudulent entities are constantly developing intricate forms of conversion fraud and new variations can target different access points within a company. Therefore, you should take the time to educate your team about ad fraud, how it affects your business, and what your employees could do to help stop it.

Work Mainly with Daytime Traffic

Research suggests that a significant amount of conversion fraud occurs late at night, specifically between midnight and seven in the morning. This is because fraudulent bots operate during these hours as there is less overall traffic, fewer human monitors, and larger bandwidth. This means that advertisers can dramatically reduce the number of fraudulent conversions in their programs by restricting them to only daytime traffic.

Avoid Targeting Older Browsers

New browsers usually bring robust security updates that prevent bots from taking control of them. When fraudsters orchestrate attacks, they commonly use older browser versions that don’t have enhanced security features. Fortunately, advertisers can decide if they want to target specific browsers. So, you should always ensure that your affiliates only generate leads that use new browsers.

Ensure that You Identify the Real Culprit

Even if there are minimal amounts, there’s a strong chance that your program will register some fraudulent interactions. Prevention is key, but experiencing a small dose of fraud also allows you to zero in on the real culprit and take specific actions to protect your program from future attacks.

Create Blacklists

As we just mentioned, advertisers are in control of their affiliate programs. If you’ve identified instances of fraud and know where they are coming from, you can create an internal blacklist and avoid working with entities that have been linked to invalid traffic before.

Develop or Revise Your Anti-Fraud Policy

In our experience, companies that don’t have an anti-fraud policy have a much harder time eradicating illegitimate traffic from their programs. Advertisers need to take the time to develop or revise their anti-fraud policy and make sure that it includes the latest types of deceitful activities.

Include Click Fraud Protection in Your Budget

One of the biggest reasons why click fraud has become such a massive issue for advertisers is because these companies take a reactive approach. Instead, you should address the problem early on and include click fraud protection activities in your budget.

Partner with a Reliable Affiliate Network

Many advertisers that manage their own affiliate programs succumb to click fraud because they don’t have the resources to monitor and validate the traffic in-house. In these cases, forming a partnership with a reliable affiliate network like lemonads can help ensure that you only work with reliable affiliates and that the conversions generated come from valid traffic.

Ready to Develop a Fraud-Free Affiliate Program? lemonads Is Here to Help

At lemonads, we’ve developed a set of in-house fraud prevention and traffic verification protocols that allow us to create a safe ecosystem for all of our partners. If you want to learn more about how to protect your affiliate program from click fraud or working with our team, contact us today and we’ll be glad to assist you.