Improper commission: how affiliates can be competitors?

The vast majority of companies that value the digital protection of their brands are already accustomed to actively monitoring their competitors. However, few pay attention to what their partners and affiliates are doing. This is where a big danger hides: improper commission. But what exactly is this practice, how is it carried out, what are its impacts on the profitability of companies, and most importantly, how can it be prevented from becoming a legal issue?

Come with Branddi and understand how to protect your brand from improper commission!

What is improper commission?

Affiliate marketing is a growing trend in the corporate world, as it allows more flexibility, reduces costs, and increases the visibility of products and services. However, it is essential that the policies set in the affiliate agreement are followed.

That is not the case in instances of improper commission. In these cases, the affiliate breaks the agreed terms and goes beyond what was determined to gain financial advantages, “stealing” organic traffic from the main company to profit from conversions that wouldn’t happen in sponsored campaigns.

That is, this practice combines brand bidding with the misattribution of what was previously agreed between the parent company and the affiliate.

Improper commission, misattribution, and brand bidding

The unauthorized use of a brand’s institutional keywords by a competing company is called brand bidding. However, when this practice is carried out by a partner company or affiliate, we call it misattribution.

These occurrences, which have dominated corporate legal discussions today, happen when the affiliate maliciously uses their partner’s sponsored campaigns. That is, they unfairly aim to raise their links even above the main brand’s to earn commissions.

This can involve various situations, such as:

• Fraudulent click: when a click is registered on an affiliate link artificially, that is, without the real intention of making a purchase or taking an action;
• Duplicate sale: when the same sale is attributed to more than one affiliate, generating duplicate payments;
• Improper cookie insertion: when a cookie is inserted into a user’s device without their consent, with the intent to misattribute a sale to an affiliate incorrectly;
• Violation of program rules: when the affiliate uses non-permitted methods to promote products or services, such as spam, unauthorized paid traffic, etc.

But how can this actually impact brands?

What are the main threats behind improper commissions?

One of the key points about improper commissions is that they can affect brands in several ways, both in the efficiency of their paid campaigns and in their relationships with partners and expenses.

For this reason, it is crucial to have a watchful eye, capable of identifying these threats before they deepen into serious problems. Below are the three main negative issues caused by misattribution and improper commissions:

Increase in the brand’s institutional CPC

Since the company’s keywords are being used without authorization, it is common for improper commissions to increase the cost-per-click (CPC) of campaigns. This way, the brand fails to see significant returns in its marketing strategies, as this value is being altered.

Increase in financial expenses

This, which is one of the main consequences of undue commissions, is also one of the worst nightmares for brands. After all, every unnecessary expense decreases the amount that could be invested in actions truly oriented to the company’s objectives.

However, to talk about this increase in expenses, we need to consider the whole picture involved in these cases. This is because, in addition to the increase in the brand’s institutional CPC, this type of unfair competition also increases the company's expenses with commissions and actions that did not generate return or real value.

Furthermore, there is still the risk that these processes may become legal, which, in addition to involving financial investments, also involves the wasting of a large part of the team’s time in resolving bureaucratic and slow litigation actions.

Increase in Distrust Between Affiliates and Advertisers

Finally, another major result of attribution diversion and the payment of undue commissions is the creation of a constant climate of distrust between advertisers and affiliates. After all, they may generate false accusations and break the previously harmonious bond.

However, this not only harms the relationship between the two companies involved: it can also affect the very reputation of the affiliate program and the main brand. This is because affiliate programs with a high incidence of undue commissions generally have more difficulty attracting new partners and advertisers.

How to Eliminate Undue Commissions from Your Affiliate Program Concerns?

Now that we’ve talked about the main issues surrounding undue commissions, it’s common for you to wonder how to eliminate this threat from your affiliate program.

That’s why we, at Branddi, have put together three practical tips to help your brand deal with its partners in a more transparent and positive way! Let’s go?

Tip 1: Create Clear and Objective Rules for Your Affiliate Policy

Establishing clear guidelines on what is or isn’t allowed in your brand’s affiliate program reduces the possibility of “gray areas.” That is, everyone will know what is expected or not and will be aware of the limits that cannot be crossed.

Tip 2: Conduct Regular Audits

Conducting regular audits ensures that all affiliates continue to be in compliance. This way, your brand can form much more aligned and lasting partnerships.

Tip 3: Prioritize Constant Monitoring

Actively monitoring the terms and exclusive elements of your brand is an essential step in identifying suspicious occurrences before they harm your company.

However, this can be a complicated task, especially for companies with a large number of affiliates in their program. At these times, having a specialist company like Branddi can be the ideal tool to protect your program efficiently and still have time to focus on other objectives.

Understand more about how we can protect your brand from undue commissions in the section below!

Protect Your Affiliate Program with Branddi!

Here at Branddi, we know how valuable your company is, so we are experts in brand protection in the digital space. In cases of unfair competition, such as brand bidding, attribution diversion, or commercial violations, our team offers continuous and in-depth monitoring at a global level, simulating locations, times, and devices.

In this way, we are able to find even affiliates who are trying to bypass superficial surveillance on Google Search and Google Shopping.

When we identify these unfair affiliates, we send friendly notifications requesting the regulation of the partnership. This action not only protects the affiliate program but also prevents the judicial development of these cases.

The proof of our effectiveness is in our results: a 70% reduction in CPC and an average increase of 20% in organic clicks. In addition to a 90% reduction in expenses with costly legal actions.

Don’t let your brand suffer from undue commissions: rely on Branddi’s support!