After Google provided the invalid clicks and invalid click rate within it's Adwords system it is time to look at fraudulent affiliate/publisher. Etracker recently published a study about affiliate hopping and the consequences for merchants. Affiliate marketing usually works pretty simple: A merchant offers a product and provides creatives or text links to advertise for his product. The publisher takes the code from the affiliate program and adds it to his site. A customer visits the publishers site, clicks on a creative or text link and a cookie will be placed in his browser. Once the user finishes shopping at the merchant, the cookie will pass the information of a sale or lead to the the merchants affiliate tracking software.
Usually the last cookie wins which means that the last publisher, who directed the customer to the product earns the commission. So far so good.
So what is affiliate hopping or affilate fraud? Affiliate hopping is different from click-fraud but can be as profitable. PPC programs are in the affiliate world pretty rare and the few affiliate programs with pay-per-click offers have usually low click prices or a build-in clickfraud detection. The affiliate hopping usually occurs with top affiliate programs. The top affiliate programs of large vendors use different affiliate platforms like Linkshare, CJ, Tradedoubler, Zanox... . All these affiliate programs work independent from each other. There is no data exchange within those networks. This means that CJ cannot read the Cookie from Linkshare and vice versa.
This also means that an affiliate with some technical skills can easily use two cookies for two affiliate programs. And all this needs only one click. With this simple trick the publisher earns twice the commission from two different affiliate networks.
Solutions for Merchants: 1. Double track all campaigns and compare inhouse tracking and affiliate networks tracking.
2. Pass the users real name or his user id to the affilite network. This way you can easily put order and name together
3. Use an internal merchandise management, which recognizes chargebacks, returns... 4. Add specific terms to your Terms of condition and make clear that you don't tolerate fraudulent affiliates.