The development of the internet and communication technologies has brought many different opportunities to our lives. For business owners, it allowed them to engage more customers, convert them into leads, implement completely different marketing strategies, and expand to other markets.
For individuals, it meant embracing their digital life even more than before and utilizing it in different ways, such as finding new income streams or studying and working online. One of the possibilities that opened for both businesses and individuals is affiliate marketing.
What is affiliate marketing?
Having an effective marketing strategy can be miraculous for any type of business as it holds power to convert potential leads into new customers. This is why more and more companies are trying to introduce new and improved marketing strategies that will allow them to engage more potential leads, inform them about the products and services they offer and eventually transform them into loyal customers. But, to do so effectively, they need to know their customers and what can work for their business to put them ahead of competitors. This is where affiliate marketing comes into play.
But what exactly is affiliate marketing?
Affiliate marketing is a marketing arrangement between an online retailer and an external website in which a business offers a commission for a visit, signup, or sale that is directed from that external website. Affiliates invest their brand and marketing efforts to entice potential customers to consider purchasing services or products from the business in question. It works out for everyone; they receive a commission for their actions, companies gain more customers, and customers get the products or services they want. While this is beneficial for everyone, it is not without risks. The online world is not as secure as we would like, and any business dealing with money is in danger of falling victim to various online risks.
What are the most common risks and vulnerabilities affiliate marketers might encounter?
Before you can tackle the task of managing risks and vulnerabilities connected with affiliate marketing, you must first know what they are and, ultimately, what their consequences could be. You can make informed decisions and manage risks effectively when you have all the necessary information. This way, you can fully enjoy all the advantages a properly-implemented affiliate marketing program can bring to you – instead of just worrying about the dangers.
The most common examples of risks and vulnerabilities affiliate marketers need to watch out for are:
1. Affiliate Fraud
Affiliate fraud is an umbrella term for any illegal activity whose goal is to commit fraudulent activities against merchants, affiliates, or customers. Fraudsters and cybercriminals are constantly working on improving their malicious actions to reach and exploit more people, maximizing their profit. This is why affiliate fraud comes in many different forms, with the most common types being:
- Traffic diverting: This happens when fraudsters steal the traffic from legitimate affiliate sites by using fraudulent “parasite sites.”
- Application fraud: According to SEON, application fraud happens when fraudsters apply for a financial product by using deceptive means.
- Transaction fraud: This type of fraud happens when a malicious actor completes a transaction by using stolen online payment methods (credit card or account information).
- Fake clicks or referrals: This happens when fraudsters generate false clicks or transactions by imitating human behavior through bots, scripts, or software.
2. Pay-To-Play Networks
Pay-to-join networks that demand you to pay a membership to use their services are another form of online danger that you might encounter. Most affiliates that are new in the business would be inclined to believe they have to pay to join an affiliate program, as they might feel that otherwise, they would be getting commission without investing anything. Treasure Data explained that the fact is that affiliate marketing is based on performance. If a marketer is not performing well, they will not earn their commission which means there is no up-front cost for the merchant. Any credible affiliate programs will not require any signup fees or membership costs.
3. Cookie Stuffing
This happens when a malicious actor uses web cookies to trick merchants into believing they have achieved a sale. Sometimes that was nobody’s sale as visitors came to the site through their own means, but often it will override the sale by a legitimate affiliate, costing them their commission.
4. Fake Products
Fraudsters will try to promote a fake product by creating an ad or webpage for it while trying to connect it with a legitimate company. Affiliate marketers and customers will be fooled by legitimate companies’ branding and reputation, and they will fall for the scam. Even big companies are not immune. In 2021, Amazon identified more than 3 million counterfeit products for sale on its website, as stated in an article by Chain Store Age.
5. Spoof Traffic
This type of affiliate marketing scam presents a risk for merchants and marketers as malicious actors use false impressions and click to look like they are producing legitimate traffic for merchants. Fraudsters will be able to collect commissions from the clicks they generate, while merchants will be left with a financial loss. This will lead to merchants being overwhelmed by the sheer amount of fake traffic, which can poorly reflect their relationship with legitimate affiliate marketers.
How can you protect yourself from these risks?
Any of the risks and vulnerabilities mentioned above can have disastrous consequences for your brand and lead to revenue loss. You didn’t spend all that time and effort building your brand from scratch, figuring out the right branding to reach the highest number of potential leads, only to be crippled by some malicious actors. Taking proper precautions can mitigate these dangers and ensure a prosperous and trusting relationship with your affiliate partners.
Ensure your terms and conditions are clear and precise.
This is one of the most critical steps, especially if you are new to the world of affiliate marketing programs and not yet familiar with the processes. Clearly define all the requirements you expect from your possible affiliate partners and provide information on what the benefits are while also defining commission rates and payment procedures. By ensuring your terms and conditions are comprehensive it will be easier to weed out the potential bad seeds and maintain an easy and informative relationship with the good ones.
Research the potential partners before accepting anything
Before signing up for anything, you should research your potential partners to uncover any essential details you might need to make an informed decision. They will usually have the statistics on their website, or they will provide you with them if asked, but you should dig deeper and try to discover if they had any bad experiences. Use search engines and social media platforms to find reviews, good or bad. While people tend to leave reviews about good experiences, they are even more vocal when something doesn’t go their way.
Cybersecurity is more important than ever, and it is everyone’s responsibility. You can make an enormous difference in your protection just by implementing security measures such as installing firewall and antivirus programs and utilizing cybersecurity tools, using complex and unique passwords, or even using common sense when clicking on links or email attachments. Be vigilant, use common sense, and do some research before clicking or accepting anything when in doubt.
Creating a successful and well-respected affiliate business takes a lot of work, and safeguarding it from any risks and vulnerabilities that might threaten it should be your priority.
Not only will this result in building stronger relationships with your affiliate partners, but a secure website will also encourage more potential leads to interact with your brand. Don’t procrastinate and wait for something to happen before you react. Start working toward a safer affiliate website now.