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Affiliate Fraud Triggers You're Ignoring But Shouldn't


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This presentation is from Affiliate Summit East 2016 (July 31-August 2, 2016 in New York City, NY). Session description: Affiliate fraud affects your campaigns in ways you cannot even fathom. It’s time to expose the secrets fraudsters don’t want you to know and finally put a stop to this needless revenue loss.

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Affiliate Fraud Triggers You're Ignoring But Shouldn't

  1. 1. Monica Eaton-Cardone Monica Eaton-Cardone is an entrepreneur and business leader with expertise in technology systems and threat metrics, product development, e- commerce retention, risk relativity and agile process design. She has co- founded a number of successful companies—including Chargebacks911, eConsumerServices and Global Risk Technologies—and currently fulfills executive management roles within each organization. Eaton-Cardone has earned a reputation for developing effective and innovative business solutions, helping merchants and banks to achieve maximum sustainability while supporting consumers in resolving transaction issues in order to main greater balance. Eaton-Cardone's deep understanding of the digital transaction life cycle and unique value chain ecosphere, provides the company with unparalleled knowledge and skill set.
  2. 2. Affiliate Fraud Triggers You’re Ignoring …But Shouldn’t
  3. 3.  Your website traffic is off the charts  Your conversion rate is awesome  You have tons of affiliates and publishers knocking at your door  Your bank account is getting rich  You are generating so many leads You think your campaign is going well because…
  4. 4. It is time to celebrate…right?!
  5. 5. It is time to celebrate…right?! WRONG!!! Believe it or not – each of those items can be a sign for AFFILIATE FRAUD Before you know it…YOU’VE BEEN PUNKED! (scammed, defrauded, taken for a ride and tricked)
  6. 6. Affiliate fraud patterns are difficult to see…
  7. 7. Fraud Filters • Fraud filters detect credit card fraud, but affiliate fraud is different • Fraud filters aren’t equipped to detect affiliate fraud • Adjusting fraud filter rules in an attempt to make them work for affiliate fraud will increase false positives
  8. 8. Repercussions of Fraud Obvious repercussions of fraud… • Chargebacks • Decreased rebills for subscription products • Increased refunds • Decreased potential for good revenue Unsuspected side effects… • Increased conversion rates • Efforts to increase profitability further damage the customer relationship and yield greater long-term losses
  9. 9. Managing Affiliate Fraud Risks
  10. 10. Understanding Fraud Affiliates Criminals Consumers Adware Cookie-stuffing Loyalty plugins Typo squatting iFrame Post back URL Discount Codes Incentives Clean fraud Account takeover New account fraud Credit card fraud Friendly fraud Family fraud Accidental fraud 300% GROWTH 10% LATERAL GROWTH 41% VERTICAL GROWTH LARGEST SOURCE OF ADVERTISER FRAUD 3 Sources, behind the scenes growth-rates
  11. 11. Review online traffic 8% growth in traffic is suspicious for non-coupon sites
  12. 12. Speak to your customers
  13. 13. Survey for Incentive Traffic
  14. 14. Offer profiling demographic comparison analysis
  15. 15. Blacklist fraudulent websites …but don’t relax.
  16. 16. Manage your conversion Geo-location, device intelligence, online behavior patterns, comparative trending analysis
  17. 17. Use A/B Scoring < A vs. B > A is the control & B is the test
  18. 18. Comparative Analysis = KPIs Define and Measure your KPIs  Quick call rates  Abandonment rates  Conversion rates – click through rates  Decline ratios  Demographic (who is your typical customer….have they changed?)  Refund rates  Google alert activity
  19. 19. Best Practices (for mitigating fraud) Regardless of the type of fraud, all mitigation strategies must include the following: • A multi-layer approach • Dynamic, evolving techniques • Professional tools • A genuine understanding of the actual fraud sources • A/B testing to establish KPIs • Use experts (mistakes are very expensive) • Continuous measurement, inspection, learning
  20. 20. AND…Explore New Innovative Tools Based on our own experience as advertisers… • Traditional fraud filters are equipped to handle credit card fraud—not affiliate fraud. • Adjusting fraud filter rules in an attempt to detect affiliate fraud results in increased false positives by as much as 72%. Therefore…advertisers need a complimentary tool that’s designed specifically for affiliate fraud. • Detect fraud to reduce costs and optimize profitability • Qualify a company that has had experience as a merchant • Machine learning and Human Review solutions are 235% more successful than automation alone