Search, Affiliate Marketing Fraud To Cost Industry Billions

Fraudulent Search — direct and organic — non-paid traffic contributes about 27% of website traffic, mostly because there are so many scrapers, crawlers, and malicious bots, according to CHEQ, a cybersecurity company.

CHEQ also recently analyzed the extent of fraud in paid marketing such as Google search and display advertising, and saw between 3% and 5% fraud.

In affiliate marketing, a performance-based advertising media, CHEQ identified that in 2020 close to 10% of traffic coming from affiliate programs was fake -- costing the industry $1.4 billion in losses.

Two years later,that number nearly doubled -- rising to 17%.

Considering that the affiliate marketing industry has since grown from $15 billion to more than $20 billion, the industry is expected to lose more than $3.4 billion to fraud in 2022.

CHEQ identifies bots and fake traffic through its technology and tags inserted in website. The tag runs about 2,000 cybersecurity tests. One test, for example, identifies whether or not the traffic comes from a fraudulent data center or has some sort of characteristic of a bot. If the data from the traffic fails multiple tests in a row, the technology determines with a very high level of certainty, the traffic came from a bot, not a human.



The data is part of an on-going study by CHEQ that analyzes fake traffic across more than 50,000 websites.

The company says that when a website gets a lot of fraud traffic from an affiliate and none converts into sales is a sign there’s a problem.

The company said that the affiliate fraud data was released after Elon Musk put the acquisition of Twitter on hold due to a dispute over the rate of bot activity on the platform.

PayPal also took a hit earlier this year after it acknowledged it had uncovered 4.5 million fake accounts in its systems.

2 comments about "Search, Affiliate Marketing Fraud To Cost Industry Billions".
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  1. Craig Mcdaniel from Sweepstakes Today LLC, June 3, 2022 at 10:12 p.m.

    I have been dealing with the fake affiliate issue but under a different attack method. The bigger problem is bad guys are buying large number of domain names and setting them up to email.  They also buy email list in large quanities.  The last piece is the affiliate advertising piece which is in many cases, legit. 

    Many times, I will see the same affiliate ad sent 10 to 15 per day to two different email addresses.  But it doesn't stop by blocking the domain names, the bad guys just get a new block of domain names.

    The best solution lies with ICANN and making domain names sales legit.  Likely ICANN will not be willing to help because of the money they make from the domain sales. However they could put in measures to improve verification and security. 

  2. Sadequr Rahman from MAHI electronics/social media Marketing You Tube Channel Company, June 5, 2022 at 1:40 a.m.

    Please manage and support 

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