THE 3 MOST COMMON FRAUDS IN DIGITAL MARKETING
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Savannah
THE 3 MOST COMMON FRAUDS IN DIGITAL MARKETING
Digital Marketing
Digital Marketing

The internet has greatly revolutionized the corporate world and business environment in general. One of the impacts of more businesses going online is the emergence of digital marketing. Digital marketing simply refers to the efforts and steps taken by a business or corporation to market their goods and services using the internet as their preferred medium. It simply takes the advertising campaigns, be they videos, banners, or voice-overs and attempts to reach their target audience via digital platforms on the internet such as social media and affiliate websites.

However, the rapid growth of digital marketing has led to emergence of various forms of fraud in digital marketing. These scams can target not only the businesses wishing to advertise but also the target audience and search engine ranking algorithms. The scammers take advantage of the relative lack of knowledge of most people about how digital marketing works and the eagerness of many new entrepreneurs to jump onboard the digital marketing bandwagon without carrying out due diligence.

The following are some of the most common frauds in digital marketing that every online entrepreneur must be aware of before contracting a digital marketing company so as to avoid falling victim to them.

Categories Of Fraud In Digital Marketing

Fraud in digital marketing falls into 3 broad categories:

  1. Placement Fraud
  2. Traffic Fraud
  3. Action Fraud

1. Placement Fraud

Digital Marketing Fraud
Digital Marketing Fraud

In this category of fraud, scammers often use underhand tactics to illegitimately place ads on a legitimate publisher’s website or user’s computer. This is done in order to artificially inflate the scammer’s clicks on these ads for the benefit of the scammer. The fraud is facilitated via a variety of mechanisms. They include:

  1. Malvertising – This fraud involves the perpetrator exploiting weaknesses in a website or Content Delivery Networks to place malicious advertising software on the website without the publisher’s (owner) permission. This results in the users being bombarded by unwanted advertisements and pop ups which generate clicks (and therefore revenue) for the perpetrator.
  2. Stuffing and Stacking – These involve unscrupulous advertisers hiding features such as ads and keywords on a page such that they are invisible to the human eye but sufficient to spoof ranking algorithms into ranking that particular webpage higher and fraudulently increasing revenue for the scammer.
  3. Domain Spoofing – This is a common fraud in which fraudsters launch a domain name that looks very similar to a trusted domain. For example they may start a site called alibaba.co to take advantage of alibaba.com’s popularity. This falsely inflates the value of their ad space and they proceed to charge premium rates to place ads there making the business being advertized to pay way more than the ad space’s actual worth.
  4. Ad Injection – This digital marketing scam targets computer users and involves scammers installing malware into an unsuspecting user’s computer or browser in order to display unsolicited ads whenever the user goes online. It may also involve your local Internet Service Provider inserting ads into the content you view when online. The best way to prevent this fraud is having an updated firewall and anti-malware system at all times and avoiding visiting shady and unsecured websites.

2. Traffic Fraud

Digital marketing fraud
Digital marketing fraud

Traffic fraud involves using illegitimate means to boost traffic to one’s site. Increased traffic means increased revenue for both the ad publisher and the business being advertised. It is therefore not surprising that traffic fraud is one of the most prevalent digital marketing scams.

Traffic fraud consists of two categories which are:

  1. Impression Fraud (pay for rankings) – This scam involves artificially boosting the web page impressions through generating fake traffic to the site. Since most of the emerging online businesses tend to be desperate for quick traffic and high rankings, they are often lured by unscrupulous marketers who often use bots to illegitimately drive traffic to their sites. While it may seem enticing, this scam is very dangerous for the owner of the website since they could potentially get their ads demonetized and search engine ratings severely lowered when caught.
  2. Click Fraud (paying for clicks) – This scam takes advantage of the pay-per-click model of digital marketing in which the marketer is paid for each click generated through their links. Like impression fraud above, the scam often targets new businesses that are willing to pay in order to get clicks to their website. The affiliate marketer then proceeds to employ the use of bots or click farm to artificially boost the number of clicks to the client’s site. The fraud is also highly frowned upon by search engine administrators and ad companies alike and carries harsh penalties if discovered.

3. Action Fraud

Digital marketing fraud
Digital marketing fraud

This fraud consists of actions taken by the fraudsters while pretending to be other users in order to benefit themselves. It may involve things such as signing up for a service, filling a form or simply making a download.

The fraud also takes on many forms which include:

  1. Conversion Fraud – This fraud occurs when a scammer uses bots to fraudulently make conversions such as signing up for newsletters. The scammer then claims the conversions as his and pockets the money from it. It may also happen when a scammer uses stolen personal details to sign up or purchase items for themselves without the knowledge of the real owners of the information.
  2. Affiliate Fraud – This scam basically involves affiliates engaging in fraudulent activities with the aim of collecting revenue that they do not deserve. A dishonest affiliate marketer may set up a specialized website with the aim of attracting users interested in a specific product. The aim is to bombard the user’s devices with the affiliate’s cookies. This means that when the user eventually visits the actual website even on their own the affiliate can then claim revenue for generating the lead when in the real sense they didn’t contribute in any way. A robust tracking system on the part of the business contracting the affiliate marketers is the best way of avoiding being a victim to this scam.

5 Reasons Why Your Company Should Partner With A Digital Marketing Agency
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Savannah

Digital marketing is the promotion of brands with the aim of connecting potential customers using the internet and other means of digital communication. Digital Marketing Agencies exist for one main goal: help companies promote their brands with the aim of connecting potential customers.

The kinds of services offered by Digital Marketing Agencies vary from agency to agency and they could be any or all of the following: Search Engine Optimization commonly referred to as SEO, Search Engine Marketing (SEM), Web Design, Social Media Marketing/Management, Email/Text Outreach Marketing, Content Generation, Content Optimization, Affiliate Marketing, Pay Per Click (PPC), among others.

Here are five reasons why your company should partner with a Digital Marketing Agency

1.Broader skill set at a lesser cost

If nothing else, this should be the main reason to partner with a digital marketing company. A digital marketing company has an entire team of specialized and experienced professionals to work on your project. This will cost less than what you would incur if you were to come up with the entire team on your own and work on the project yourself. This is even a better option for small business that do not have resources to hire a full time SEO specialist. A full in-house digital marketing team will result into a significant overhead cost for the business especially a small business as salaries, benefits, recruiting and more will bring expenses to the business. An external marketing agency may offer a lower cost to do the same work that an in-house marketing team will have done at higher cost.

Blog: Re-inventing the 'desired' skill set of your employees — People Matters
Image from people matters blog

2. Expertise and productivity

Digital Marketing Agencies have people with expertise and different skills sets in digital marketing sector. This will give you an advantage in getting high quality work in an efficient way allowing you to redirect your efforts and time to other things. Partnering with them also gives great value on investments as 100% of it goes to production of deliverables. None of your budget is being spent on benefits, equipment and hiring. These agencies are also efficient in that they handle multiple accounts, which helps them meet strict deadlines and most company budgets. In a typical situation they can get work done faster than in-house teams that are working on the same project for the first time

3. Less commitment compared to hiring a full time in house team

The process of hiring a full house team involves activities such as recruiting interviewing, onboarding etc. This are all activities that the company is responsible for. These are time consuming and expensive tasks. A marketing agency can do all the hiring and recruiting of digital marketing experts, and you can outsource the skill from them

Supply-O-Meter

4. A broader network and access to advanced tools

A broader network and access to advanced tools – Working with many clients builds a network of vendors and channels that can to future partnerships for your company. A digital marketing agency will also have a more tools and resources available to them that will enable them to complete the project faster. This may include some tools and resources that are only available to companies in the industry and industry professionals.

Building a Wider Network | Thinking Bigger

5.Creativity and objectivity

Using an in-house team can sometimes nerf the creativity process as they may be people thinking as a group and people having tunnel vision. Partnering with a digital marketing company however may be better as we will have an opportunity to get creative aspect of a person seeing the company from the outside unlike an employee. A digital marketing company is not also influenced by internal biases or assured knowledge so its easier to sieve a clear message to the target audience. Internal teams may have too much knowledge such that they may try and say the same thing and over saturate with knowledge, this may result in confusing the target audience with too much information.

Innovation is a Journey, Not a Destination | Daniels College of Business

How affiliate marketing works
AFFILIATE MARKETING EXPLAINED IN 5 SIMPLE STEPS
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Savannah
How affiliate marketing works
How affiliate marketing works

Affiliate marketing can be defined in many different ways. Investopedia defines affiliate marketing as “an advertising model in which a company compensates third party publishers to generate traffic or leads to the company’s products and services”. Basically, affiliate marketing involves an online business employing third party websites and social media advertisers to drive sales to the business in exchange for a commission. An affiliate is the individual/organization whose website is used to drive traffic (and eventually sales) to the business’s site.

 Being a performance-based model, the business only pays the third party (affiliate) when a sale is made as a result of their efforts. This makes it a very efficient and cost-effective marketing model since the business only spends money when they earn, as opposed to traditional advertising where the advertising budget is spent whether or not the marketing campaign is successful.

Affiliate marketing works under an affiliate program. This is the structure and method that directs the working relationship between the business (merchant) and the affiliate partners tasked with generating leads to the merchant’s business. Affiliate programs use different performance-based criteria to ensure that the affiliates earn for every referral to the merchant that converts to actual sales. According to the model of the business, the affiliate may also be paid for other goals agreed upon such as when the referred customer makes a download or signs up for a newsletter.  

Affiliate Marketing Models

Various methods are used to determine how the affiliate will be paid. While the main goal of the marketing campaign tend to be sales, affiliates can also be paid based on other milestones that are not necessarily sales. The affiliate may be paid based on a wide range of actions taken by the visitor they bring to the merchant website. They include:

  • Cost per click: In this model, the affiliate partner gets paid for all clicks on the merchant website generated through the affiliate’s links, regardless of whether the clicks led to a sale. This is typically employed by merchants that require a high volume of generic traffic to their website.
  • Cost per lead: The merchant pays the affiliate for each lead generated. A lead can be an action by a visitor such as signing up for a newsletter or registering for a trial version.
  • Cost per sale: This is the most common model which involves paying the affiliate partner for each sale generated from their efforts. The affiliate may earn a commission or a flat rate agreed upon beforehand for each sale.
  • Cost per install: The merchant pays the affiliate each time a referred visitor makes an app installation. This is typically used when the merchant is promoting a mobile or computer application that needs to be installed by the user.

The Process Of Affiliate Marketing

Affiliate marketing process
Affiliate marketing process

The affiliate marketing from start to finish can be summarized in 5 broad steps:

  1. Referral
  2. Conversion
  3. Tracking
  4. Reporting
  5. Payment

1. Referral

How affiliate marketing works
How affiliate marketing works

An ideal affiliate partner is one who already has a sizeable pool of followers or audience whose traffic can be directed to the merchant’s website. The partner’s website is typically where the user will first see and click on the link that will lead them to the merchant’s website. The main aim is to convert at least some of the visits to actual sales. In addition to the affiliate’s website, the affiliate may also use other platforms such as Facebook, Instagram or Whatsapp to promote the merchant’s products and services.

The success of affiliate marketing is largely linked to the amount of sway the affiliate has over their audience. An affiliate with a large and trusting following will often lead to more leads which are likely to be converted to sales. As the users view the merchant’s links or products being promoted by on a trusted person’s (affiliate) website, they see it like a personal recommendation from them and are more likely to check the products out. This is unlike traditional advertising which relies on advertizing campaigns carried out by companies with little personal connection to the consumers.

gfr agreed upon milestone.

2. Conversion

Once the affiliate drives traffic to the merchant’s website, the next main stage is conversion. In simple terms, conversion refers to any action taken by the visitors on the merchant’s website that contributes towards a ‘success event’ or sale. While the target of most merchants is usually sales, the success event can also include other actions such as service subscription, a download, a booking, an app installation, or any other action that benefits the merchant.

Some of the affiliate’s traffic may not immediately lead to sales but may benefit the merchant in the long run such as by making the user to make enquiries about other products sold by the merchant and later purchase or refer a friend or relative. For the merchant to be able to get this information and reward the affiliate accordingly, it is necessary to track all user activity.

3. Tracking

In order to get the most out of the affiliate program, it is necessary for the merchant to track consumer activity across the website. This helps know more about how users navigate your platform and provides information to improve the website and affiliate program in order to convert more clicks into sales. As much information as possible should be tracked in order to know things like which page the user visited first through the affiliate, the duration they spent on the website before purchasing, and whether or not they became returning customers. Knowing your customer helps you improve your affiliate program and tailor your marketing campaigns around the behavior of the customer to ensure more successful events in the future. 

4. Reporting

Affiliate programs often require reporting software which analyzes user and affiliate behavior and creates a report on the findings. There are two types of reporting:

  1. Performance reporting – this provides a record of information sorted according to device, promotion code, or time.
  2. Insight reporting – this is an analysis that utilizes the collection of all conversion points to come up with a clear picture of the role and value of each affiliate partner in the program.

Effective insights reporting helps determine what each affiliate contributes, which affiliates bring the best high value customers, which affiliate partner strategies are the most effective, and enables you to streamline compensation  to ensure that each affiliate partner earns in proportion to their level of contribution.

5. Payment

How affiliate marketing works
How affiliate marketing works

This is the last stage of the process. After carrying out the necessary tracking and analysis to find out the contribution of each affiliate, the affiliate can then get paid based on their performance. Payments are usually done on commission either as a percentage of the sale value or a flat rate per purchase. Flat rates work best where the merchant deals with a single product of fixed value (such as a bread bakery) where the expected profits are fixed. On the other hand, merchants with many different products often pay the affiliate partners a percentage of the value of the products purchased.