More and more companies, both online and off, are turning to performance marketing programs to help boost their sales. While this is certainly a good thing for both the companies and the affiliate marketers, it has also caused some significant problems related to fraud and other criminal activity. Honest marketers and businesses can agree that this is only going to hurt the overall industry, and more and more people are starting to take action against disreputable marketers and affiliate networks.
In 2010, for example, the FBI arrested and charged Shawn Hogan (among others) with fraud against eBay. They had gotten $21 million in affiliate sales using dishonest and illegal methods. Their methods were tracked down by Benjamin G. Edelman, a Harvard Business School associate professor who was hired by eBay to catch those committing fraud against the auction giant.
After this case, Edelman continued to research the world of affiliate marketing, and has recently published a major paper, along with Wesley Brandi, that should help businesses choose how to manage their affiliate programs. While the paper is written with companies who have, or are looking to start, affiliate programs, it is well worth the time of any marketer to read as well. It will help marketers learn about what types of things brands are really looking for in an individual marketer, or in an affiliate network.
Marketers can use this paper to help identify which affiliate networks are operating in a less than honest way, and avoid them. The world of performance marketing is getting more and more attention every day, and marketers won’t want to be associated with shady networks, or it could hurt their career long term. With this in mind, keeping up to date on this type of information is essential.
Edelman says of his paper, “We consider alternative methods of supervising staff who have significant discretion and whose efforts are subject to both incomplete information and skewed incentives. Specifically, we examine online affiliate marketing programs in which merchants oversee thousands of affiliates they have never met.”