7 Things to Investigate When Approving Affiliates
We all know affiliates have the potential to be highly beneficial to a company's bottom line. But affiliates can also be a big risk. If companies want to mitigate the risk from affiliates, they must be able to prevent and detect low-quality traffic and affiliate fraud.
Now there are two ways to initiate a partnership with affiliates. One way involves an automatic sign-up process, which allows companies to distribute many links to its landing pages in a short amount of time to a variety of sites. Before discussing the second way, I want to talk about the dangers of the auto-approval process.
Companies that allow individuals or companies to fill out a form and receive links to their landing pages are vulnerable to affiliate fraud and low-quality traffic. Both are costly and both are preventable.
The best way for affiliate managers to protect their affiliate channel from low-quality traffic and affiliate fraud is to implement a payout threshold. For example, a threshold of $100 means the affiliate is required to earn $100 in commissions (not total sales) before receiving their first commission check. By requiring affiliates to reach a certain threshold before they can earn their commission, companies are encouraging their affiliate channels to provide high-quality traffic, thus ensuring a win-win situation between the company and its affiliates.
Another way to prevent affiliate fraud and low-quality traffic from auto-approved affiliates is to delay payouts for up to 90 days. This delay provides the time to properly monitor the sales and traffic from the affiliate channel, as well as factor refunds and chargebacks into the commission.
So how does one monitor traffic from affiliates? The following are different rates that companies can measure to monitor low-quality traffic and affiliate fraud. Determining whether the given rate from an affiliate channel is good or bad depends upon comparing it with that same rate for sales directly from the company's site.