Increase Revenue Without Increasing Risk
Affiliate marketing has quickly become one of the most viable methods of increasing sales in a cost-effective manner. However, this advertising method comes with significant risks. If these risks aren’t managed properly, long-term ramifications can negatively affect the success of your business.
The Correlation Between Affiliate Fraud and Chargebacks
Unsavoury affiliate marketers have learned various methods to illegitimately earn a commission. Not only do these tactics rob merchants of profits, they also increase the likelihood of chargebacks.
Of the various affiliate fraud techniques, two are especially damaging to unsuspecting merchants:
- Affiliate marketers facilitate purchases with stolen payment card information. Whether they are making the transactions themselves or turning a blind eye when others commit fraud, the action of these affiliates ultimately leads to chargebacks. The innocent cardholders file transaction disputes and merchants suffer the consequences.
- Affiliate marketers use false advertising to capture consumers’ attention. By making promises the merchant can’t keep, affiliates are able to entice consumers who wouldn’t normally make a purchase. When the merchant can’t live up to the consumers’ expectations, chargebacks are filed.
The Dangers of Affiliate Fraud Chargebacks
The long-term effects of affiliate fraud are far-reaching.