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You want to protect your affiliate program from fraudulent activity. But, at the same time, you donât want to stifle all those legit creators who are doing a fantastic job promoting your brand and product.
Tricky one, huh?
Fortunately, Iâve got some good news: you don't need enterprise-grade fraud detection to protect a mid-size affiliate program. All you need is the right setup and visibility. Iâll explain exactly how to achieve that in this article, with more than a little help from two bona fide affiliate marketing experts:
This issue occurs when an affiliateâs unique discount code ends up on third-party coupon sites â either because the website scraped it using bots, or because someone leaked it to them.Â
Sometimes, the person doing the leaking is the affiliate themselves.
Melissa says code hijacking is the âmost common form of affiliate abuseâ, especially during busy periods like Black Friday where creators might think theyâre more likely to get away with it. Robert adds that the team at Deeper have seen âa fewâ examples of âvery aggressiveâ hijacking.
The creator would go to every market-related forum/group/chat and start spamming his code or link every time he had a chance.
Fortunately, though, Melissa says this particular issue generally isnât too difficult to identify.
Code hijacking can be pretty obvious when itâs happening as the sales donât match with the quality of content pieces posted.
While Melissa says coupon and promo code hijacking is the most common type of affiliate abuse, Robert insists itâs actually click fraud and bot traffic â AKA when affiliate scammers use automated bots to inflate their performance and commissions by simulating âhumanâ clicks and conversions.
Again, the good news is that while this spammy tactic crops up a lot, Robert says itâs usually easy to spot.
Bot traffic is often from very unrelated countries, such as the creator having an 85% German audience, while the traffic comes from Vietnam, Australia, Latvia, etc.
One important thing to note: Melissa points out that click fraud isnât always deliberate.
The affiliate platform we use shows how many clicks are from bots, but this can happen because a piece of content went viral and received bot clicks rather than the creator intentionally being fraudulent.
In other words, you shouldnât instantly kick a creator out of your program if they start sending bot traffic your way â but youâll definitely want to investigate further to understand whatâs going on.
Return abuse is when an affiliate drives a (seemingly) legit sale, only for the purchase to be canceled or returned after the commission has been paid. Boooooo.
Robert says heâs seen some attempts at return abuse. But theyâre usually quick and easy to solve because Deeperâs return policy and payout window mean the return happens before the commission payment gets sent. So it simply became âtoo much hassleâ for would-be fraudsters to try and make the timings work.
With cookie stuffing, dastardly affiliates use methods like hidden iframes and âpop-undersâ to plant their tracking cookie on a shopperâs browser unnoticed, allowing them to falsely take credit for sales they actually had nothing to do with.
Melissa says she encountered a suspected example of this recently:
The affiliate appeared to be driving a lot of commission and traffic â but there was no content to match, and their social media profiles were very low-quality.
This gets to the heart of the matter: cookie stuffing, like any form of affiliate abuse, is annoying. But with a little investigation, you can spot it and stamp it out đ«
The first step to preventing affiliate abuse is to give yourself the best possible chance of hiring affiliates who are đŻlegit. How? By rigorously vetting their audience and content before inviting them to join your program.
First up, audience vetting. Thereâs no real way to do this manually (AKA without help from dedicated software), but there are plenty of free tools that will do some of the work for you.
For example, Modashâs free fake follower checker for Instagram gives you a creatorâs fake follower percentage â bear in mind anything around 25% is totally healthy â as well as limited data on:
Thatâll get you some of the way, but youâll still want to spend some time checking out their social profiles to make sure their content is up to scratch. Is it super spammy? Is every other post sponsored? And does their style and tone align with your brand?
All of which takes a bunch of time. Itâs fine if youâre only working with a handful of creators, but if youâre looking to scale your affiliate program, you need a more efficient solution.
Thatâs where dedicated creator marketing platforms like Modash come in.
With Modash, you can access detailed audience metrics for any account on Instagram, TikTok, or YouTube with 1,000+ followers.
Open a creatorâs profile to see a ton of data on their audience, including gender, age, location, language, and interests.Â
Plus youâll find platform and content-specific engagement metrics. So for Insta, youâre not just working with their overall engagement rate, but also average Reel plays and estimated reach for Stories.
And Modash also shows you the creatorâs most popular posts and latest collabs. Because dodgy affiliates donât make good content â if they did, they wouldnât need to rely on fraudulent activity to make money.
Sure, itâs technically âcheaperâ to rely on a suite of free tools plus your own intuition to vet affiliates, but once you scale to 10+ creators, the opportunity cost of a paid platform will be a whole lot more affordable.
đ Try our affiliate vetting tools yourself when you create your free Modash account!
One last point on this from Melissa: research which platforms the affiliate uses.
For example, you can easily drain commission when links are placed in coupon and deal groups, as a lot of people click with no intention to buy.
She says this is especially true in Instagram broadcast channels because you canât really include images of the product, which âmassively reducesâ a linkâs potential conversion rate.
Remember: not all âfraudulent activityâ will be deliberate. Some of your affiliate partners simply might not know that theyâre doing something against the rules, like sharing their promo code on public forums.
Itâs up to you to make sure every creator in your program is totally clear on your terms for coupon usage and how you attribute sales. The obvious solution is to make it a key part of your affiliate onboarding process â that way, all new affiliates should know whatâs expected.]
For example, Melissa recommends insisting that affiliates always clearly show the product when sharing links, as well as ideally mentioning the store and providing a brief product description.
Driving people to links with vague descriptions massively reduces the conversion rate and drains commission. Being upfront with what youâre linking to is a key guideline to combat this.
One of the most effective ways to protect your program against affiliate abuse is to build in a âhold periodâ whereby you retain a creatorâs earned commissions for a set period â typically around 30 days â until your window for refunds has passed.
That way, youâll never pay out for a sale, only to discover it got returned the day after the commission hit the affiliateâs bank account đ€Šââïž
Robert says that using this approach has helped Deeper to largely stamp out return abuse.Â
Our return policy is 30 days from delivery. Considering it also takes around a month to receive commission payouts, itâs usually no longer feasible for affiliates to try and make fraudulent returns.
As an added bonus, hold periods also help your affiliates accrue larger balances, so you can pay them all in one go rather than making dozens of micro-transactions.
đ€ Further reading: Learn more about payout timings, hold periods, thresholds, and more in How to Pay Affiliates: Methods, Tools, and Best Practices.Â
Top-performing affiliates often have impressively high conversion rates â after all, their audience is a perfect match for your brand, their followers trust them, and they make great content that accurately and persuasively promotes your product.
Thatâs not a crime â that's the whole point of affiliate marketing.
However, if an affiliate is converting at a massively higher rate than your program average, itâs worth taking a look to see whatâs going on.
Modash is your best friend here because we track link clicks vs discount code redemptions per creator.Â
A suspicious conversion rate reads very differently once you split it by source; code-driven sales with almost no link clicks could be a sign of hijacking or cookie stuffing.
Similar to looking out for affiliates with insanely high conversion rates, youâll want to look out for anomalies in traffic-to-click ratios.
On a simple level, if a creator is generating more sales than clicks, thereâs obviously something going on. Maybe itâs a tracking issue. Or perhaps the affiliate in question is up to no good.
As such, Melissa says these anomalies are pretty simple to detect:
You can crosscheck the number of content pieces with the commission. If thereâs no content to display, but a lot of order value generated, then you can assume thereâs been some fraudulent activity.
BTW, with Modash, you can see exactly how many clicks a creator has generated and when they happened, which makes it a whole lot easier to compare traffic volumes against sales.
If the same customer is using different discount codes across multiple transactions, itâs a safe bet that not all those purchases were motivated by affiliates. Unless they just happen to follow a bunch of creators who are all part of your affiliate program, which seems like a weird coincidence.
More likely, they found those codes somewhere else, which is an indication they were leaked beyond the intended audience â such as being published on coupon sites or deal forums. Or it could be a sign of affiliate collusion, whereby 2+ creators distribute each otherâs codes.
Either way, if this is a recurring issue for your brand, you can mitigate it to some extent by regularly sharing new discount codes with your creator partners.
For a lot of brands, affiliate marketing is primarily a new customer acquisition channel. Indeed, some programs only pay commissions for sales to new customers, or offer lower commission rates on existing customer sales.
Letâs assume your program rewards creators for selling to both new and existing customers. In that case, if an affiliate is driving waaaay more returning customer sales, they may be targeting people who are already committed to buying.
Which, in turn, could suggest that their promo code has ended up on a coupon site.
đ€ Pro tip: Donât fancy manually calculating each affiliateâs ratio of new to returning customers? I donât blame you. Save yourself the time with Modash, which syncs with Shopify to automatically distinguish first sales vs repeat sales. In effect, this data tells you each affiliateâs new-vs-returning mix, so an affiliate skewed heavily toward returning buyers becomes visible instead of a hunch.â â
Another way to detect potential affiliate abuse is to look for discrepancies in what a creator was promoting vs what converted.Â
They posted about menâs socks but earned all their commissions on woodwind instruments? What gives? (And also, what kinda store are you running??)
Similarly, if you suspect an affiliate is doing something nefarious, itâs worth looking at their live content to see if it sucks. Lazy, low-effort, AI-sloppy posts donât tend to drive sales â so if thatâs all theyâre sharing, thereâs something kinda sus going on.
Modash can help here. Our tracking tool automatically collects every piece of campaign content your affiliates post, so you donât have to go find it yourself.
 You can also mouse-over each content piece to get a quick view of performance, which helps you identify affiliates who are seeing low reach and engagement but are somehow still generating lots of sales đ€·ââïž
Affiliate abuse can happen at any time. But the threat is particularly high in the run-up to payout dates as fraudsters look to fly under the radar with a bunch of last-minute sales.
To be clear, as with all the possible signs of abuse in this list, a spike in activity around payment periods isnât conclusive proof of abuse. There are lots of other potential explanations â maybe you were running a sale or launched a new product at the time? Or perhaps your payout period is at a point in the month when lots of other people have money to burn?
The key here isnât just to look for high activity around payout periods; itâs to be wary of affiliates generating a significantly above-average volume of sales during these times.
đ€ Pro tip: Your best defence against this type of affiliate abuse is to delay paying commissions â say, for 30 days â so you can be sure all those commissionable orders are legit.
Returns and chargebacks are an unavoidable part of ecommerce. But thereâs no reason why your affiliate program â or specific affiliates â should be seeing higher rates than the rest of your store. If a creator is seeing significantly higher-than-average numbers for chargebacks or returns, it could be because theyâre trying to earn commissions through fraudulent sales.
Your affiliate software can help protect you against this type of affiliate abuse. For example, with Modash Pay, affiliate earnings remain âpendingâ while your return window is open â then if an order is refunded during that period, the commission is automatically cancelled or reduced.
Look back over your affiliate sales. If youâre seeing multiple commissions linked to the sameâŠ
âŠthen it could suggest that an affiliate is creating fraudulent accounts to earn commissions from self-referrals. Or maybe lots of people just live in the same apartment and they all love your products?
To be clear, self-referrals arenât necessarily a problem. Some brands are happy for affiliates to earn commissions on personal orders; others arenât. Variety is the spice of life, eh? So your best bet here is to decide your own stance and communicate it to your affiliates â if youâre fine with self-referrals, thereâs no need for any underhand tactics.
Given the growing focus on consumer privacy, itâs getting harder for brands to track traffic sources accurately. Still, if an affiliate is sending large volumes of âdirectâ or unknown traffic your way, it could be because theyâre trying to mask forbidden promo methods. Naughty, naughty.
This issue rarely requires immediate action. More likely, youâll want to monitor over time to see whether an affiliate keeps sending you undefined traffic month after month. If so, the simplest solution is to just ask them whatâs going on. If they canât explain and it keeps happening, it might be time to show them the door đ
Itâs not unusual for different types of creators to have substantially different average order values. Youâd expect an affiliate offering money-saving advice to cash-strapped parents to see lower AOVs than a tech reviewer promoting a new set of headphones â even though both could be working with the same brand.
That said, if youâve got an affiliate who consistently registers average order values that are much higher or lower than your store average, theyâre worth investigating further.Â
They could be buying lots of high-value items themselves with an eye on returning them once theyâve got hold of the commission. Or perhaps theyâre placing a ton of small orders to maximize commissions (a particular threat for brands paying a fixed cash amount per conversion).
đ€ Pro tip: If your store is on Shopify, Modash helps with this by tracking net revenue and order volume per creator. Because our revenue figure is net of returns, an affiliate inflating orders and then returning them shows up as a gap between gross activity and net revenue.
Sometimes, good months just happen. But if an affiliateâs sales are strangely high compared to the amount/quality of content theyâve shared for 2-3+ months in a row, this looks more like a trend than a coincidence. As such, Robert recommends trying to track down the original piece of content that caused a spike in sales.
If you see that within the same week a piece of content was released by the creator â or even better, if you see it performed really well â then chances are theyâre not being sketchy, they just got lucky.
Both Melissa and Robert say there shouldnât be a blanket rule for kicking out affiliates after suspected abuse. It all depends on what, exactly, youâve seen.
For Robert, cases of click fraud and code hijacking are often at least somewhat innocent and can be stamped out by simply speaking to the creator in question. Whereas if itâs a sales-related fraud, heâd likely remove them immediately.
On the flip side, Melissa says she wouldnât instantly block an affiliate, but she would keep a âreally close eyeâ on their activity â what content pieces theyâre sharing, where the clicks and commission are coming from â and act fast if she saw clear evidence of fraud.
While most affiliate marketers donât enjoy situations like this, Robert says it gets a lot easier to handle if youâve collected the data to back up your suspicions.
Consistent refunds within 14 days of purchase is a trend; appearance of codes everywhere is a trend. So itâs mostly a question of how well the manager is prepared for the discussion.
Melissa adds that if youâre âfairly certainâ about affiliate abuse, you can suspend the creatorâs account to give them chance to stop.
Communication-wise, you should be firm and reiterate any guidelines without being accusatory.
In a word, yes: coupon abuse can still happen with unique codes if the code lands on a website or in a social community used by masses of people. In this instance, Melissa says itâs important to look for anomalies by crosschecking the content output with the orders driven.