8 Common Affiliate Marketing Scams to Watch Out For (+ How to Avoid Them)

Are you a business owner who’s thinking about starting an affiliate program? Maybe you’re a content creator thinking about diving in and trying to make a living with affiliate marketing? 

Either way, you’re making a good choice! The affiliate marketing industry is currently worth over $17 billion. Experts predict that this number will surge to $27 billion by 2027. 

Despite the bright future of affiliate marketing, there are still things you need to watch out for. Like every popular or profitable strategy, there are scammers in the background waiting to take advantage of people and businesses who are not paying attention. 

It’s estimated that the average affiliate fraud rate is 9%. That doesn’t seem like a whole lot until you consider that this translated to a $1.4 billion loss in 2020 alone!  

And these scams do not just go one way.

Today, we will explore how fraud can affect both businesses with affiliate programs and affiliate marketers. You’ll discover the top 4 most common scams for both groups. You’ll also learn a few strategies that can help you avoid falling for these scams in the future. 

Let’s dive in! 

4 affiliate marketing scams businesses need to know about 

Let’s start by covering the scams business owners and affiliate managers should look for when running an affiliate program.

1. Bot traffic

Bot traffic is a common affiliate scam that involves using automated software, or bots, to generate fake clicks, visits, and even conversions to an affiliate partner’s website. The fraudster uses these junk clicks to inflate their commission earnings. 

This scam cheats merchants because the clicks they see cannot be converted into customers. In the rare case that the affiliate uses bots to make purchases, refunds usually follow, but not before the affiliate earnings hit their account. 

How to avoid this scam: 

• Monitor traffic. Keep an eye on your website traffic and other key analytics so you can identify unusual patterns that may indicate your site is getting bot traffic. For instance, a quick, dramatic increase in your bounce rate is one sign of bots. 
• Verify visitors. Use multi-factor authentication and CAPTCHAs to prevent bots from making disingenuous purchases.

2. Cookie dropping

Cookie dropping is another common scam you need to look for as a business owner or affiliate manager. This scam involves affiliates placing tracking cookies on their site to claim commissions for sales they didn’t actually influence. 

The way it works is very sneaky. Scammers sign up for an affiliate program like any other person.

Next, they secretly embed the tracking cookie on their website that includes their affiliate code. When someone visits their website, the cookie is dropped on their browser without their knowledge, and if they ever visit the partner website and make a purchase, the scammer gets a commission. 

Not only is this practice illegal since the visitor never agreed to use their affiliate code, but it can also erode customer trust, increase costs for businesses, and devalue the impact of authentic affiliate marketers. 

How to avoid this scam:

• Track affiliate traffic. Use advanced affiliate network tracking tools so you can see if one person is getting far more conversions than others. If you notice a stark difference, it’s worth investigating. 
• Verify the customer journey. Keep an eye on user journeys and cookie timestamps. If you notice consistent discrepancies, you may want to look into the affiliate(s) to make sure they are not cookie-stuffing. 

3. Fake endorsements

Another extremely common affiliate scam is fake endorsements. Essentially, this means someone is pretending that you said something good about their website or brand.

For instance, a bad actor in this category might take a screenshot of the CEO and create a fake quote in Photoshop endorsing their brand. The goal is to steal some of the built-in trust people have for their partner.

The thing is, they don’t really care about long-term trust. They just want visitors to believe the fake endorsement long enough to make a purchase and secure a sale.  

Scams like this have been going on for years. One of the most common variations involves using fake celebrity endorsements.

Here’s an example of a phony endorsement from Oprah Winfrey. This is a blatant example of deception because they don’t even have a direct quote, just pictures of her in the background, as if to say, “Oprah trusts us; why shouldn’t you?”

How to avoid this scam:

• Work with reputable partners. You could make an affiliate program with a full-fledged application process. This allows you to verify that potential partners have high-quality sites with no signs of fake endorsements. 
• Check Google and social media sites often. Search for your brand name and relevant hashtags so you can see if anyone is making misleading claims or endorsements. 
• Audit affiliates. Occasionally review partners’ sites and social media feeds to ensure they are following your guidelines and using white hat techniques. 

4. Typosquatting (AKA URL hijacking)

The last business scam on our list is a practice called URL hijacking. This scam relies on people making typing errors, which is why it’s also called typosquatting.

Basically, someone will buy a URL that’s very close to a reputable site and rely on visitors accidentally typing the misspelled version to find their site instead. 

Here’s an example using a fictional website; instead of Shoes4less.com, a typosquatter may buy the URL shoes4les.com. Notice the missing ‘s’ in ‘less.’

The person who purchased the typo site then gets an affiliate code for the brand they are copying. Every time someone makes the mistake of typing ‘les’ instead of ‘less’, they are directed to the fake site. 

From here, the scammer can use cookie stuffing, which we discussed earlier. Or, they can provide a reputable-looking link to the site, which has their code attached. Either way, it’s unethical and a scam that businesses across all industries need to watch out for. 

How to avoid this scam:

• Secure URLs close to your name. In our example, the business would register shoes4les and other variations before typosquatters buy them up. 
• Make your site unique. You should also consider adding elements to your site that are unmistakable and very difficult to replicate. This will cue shoppers if they land on a fake URL, and they can report it to your team. 

4 scams affiliate marketers need to know about

Now, let’s change perspectives and talk about scams that affiliate marketers need to watch out for when looking for programs and partners. These are more common than you might think, so staying vigilant is key! 

1. Fake experts

If you’re one of the 4.74 billion social media users in the world, there’s a pretty good chance you’ve come across a fake expert. These self-proclaimed gurus like to create videos and ads that talk about their “top secret” affiliate marketing strategies.

They often promise to let you know about their secrets if you do something simple like join their email list. In reality, they are going to take your information and try to sell you an expensive course that has little to no substance. 

These folks are usually not experts. If they were, they probably wouldn’t want to sell their secrets to everyone or waste time teaching when they could be working their “alleged” magic. 

How to avoid this scam: 

• Research is key. If you see one of these advertisements and think, “This one must be legit,” do your homework. Search for their name, the name of their course, and variations that include words like ‘scam’ and ‘fraud.’ 
• Look for free resources. In most cases, you can find what these fake gurus are offering in their courses and much more for free. Check out videos on YouTube, read reputable blogs, and look for affiliate resources that don’t promise things like ‘overnight success.’ 

2. “Paid” affiliate programs

A general rule of thumb is if someone running an affiliate program asks you to pay before you start, it’s probably a scam.

These platforms often promise exclusive marketing channels, abnormally high-paying commissions, or products that the affiliate is expected to pay for and sell.

The reality is the business is overhyping and overpromising so they can take advantage of new or inexperienced affiliate marketers. The fees are usually extremely steep and promise attendees unlimited possibilities and rapid financial success. When the affiliate inevitably fails to make a profit, they will refuse to give a refund. 

Here’s an example of this type of scam merged with the fake expert scam:

How to avoid this scam:

• Do not pay to join an affiliate program. The best way to avoid this scam is to never pay an upfront fee to become an affiliate. Reputable merchants will be more than happy to help you get started for free because you’re promoting their products or services. Think about it this way: why would you pay someone to promote their business? 

3. Fake products or services

Another scam you need to keep an eye out for is fake products. This scam is usually pretty easy to spot, but it’s becoming more common over time. In this instance, a scammer creates a website with products that don’t exist. 

They open an affiliate program and allow unaware affiliates to promote their brand. The goal is to get the partner to convince people to go back to the scammer’s website and make a purchase. 

In most cases, the scammer will allow this to go on for a while. The whole time, they will give excuses to the paying customers and the affiliates as to why they can’t deliver on the products and commission.

By the time people figure out what’s going on, the scammer will delete the website and keep all the ill-gotten gains. 

How to avoid this scam:

• Look for red flags. If the business is promising a product or service that appears to be too good to be true, it probably is. 
• Read the program terms and conditions. Before becoming an affiliate, check out their affiliate agreement. You should look for potential loopholes or unclear language that’s designed to benefit the merchant. 
• Do your homework. Look into other affiliates of the company and see if they’ve had success. When in doubt, consider reaching out and asking. 

4. Bait-and-switch commissions

The final scam on our list for affiliates is called bait-and-switch commissions. As the name implies, a bait-and-switch commission is when an affiliate is promised a certain commission rate, and it suddenly changes after a few sales. 

The change could be direct, such as telling them it’s 10% and then changing it to 3%. It could also involve adding ‘hidden fees’ that reduce how much money they make per sale. If you’re promised 10% and there’s a 25% fee on every sale, you’re not really getting a 10% commission.

Businesses that take part in this activity are out to actively scam affiliates out of what was promised to them.

How to avoid this scam:

• Much like the fake products, the best thing you can do here is read the terms and conditions. Make sure you request a copy of the contract and read it carefully. Then, print it out so you have a hard copy in case they decide to change the agreement. In this case, having the original contract would be crucial for legal recourse. 
• Keep track of your commissions. Don’t count on affiliate managers to track your sales. A private record will give you something to compare the affiliate payout to, which will make it easy to identify if you’re getting less than you were promised. 

Final thoughts

The affiliate marketing industry is booming, offering exciting opportunities for both businesses and content creators. However, like any lucrative space, it also attracts bad actors who engage in deceptive practices.

This post has explored both sides of the equation, outlining the top 4 scams targeting businesses and affiliate marketers, along with actionable strategies to navigate them.

Whether you’re a business launching an affiliate program or a marketer searching for trustworthy partnerships, the information covered here will hopefully make you aware of some of the most common affiliate marketing scams. 

Guest Author: Syed Balkhi is the founder of WPBeginner, the largest free WordPress resource site. With over 10 years of experience, he’s the leading WordPress expert in the industry. You can learn more about Syed and his portfolio of companies by following him on his social media networks.