Coupon Fraud: How to Prevent Leaked Affiliate & Referral Codes

Discounts are the most important marketing tool for eComm brands. Customers love and EXPECT them. In fact, 88% of buyers say a promotion makes them much more likely to become a first-time customer. 

Providing affiliates with personalized referral codes is an important tool in driving revenue from your creators. It’s a win-win scenario where you receive more orders and the content creator makes more commission. 

However… there’s potential for big problems.

Coupon-sharing companies, like Honey, RetailMeNot, and Rakuten recognized this trend and decided to monetize on it. By scraping checkouts for codes, these sites made referral discounts widely available on the internet.

What is Coupon Fraud and Leaked Affiliate Codes

Affiliates leak codes intentionally (I posted my code on a coupon site – affiliate fraud) or unintentionally (my code is scraped by Honey – leaked affiliate codes). They rake in thousands of dollars in commission that they don’t deserve.

These leakages can destroy a your margins while ravaging an affiliate program’s attribution. And it’s becoming more and more common. 

How can I Monitor for Coupon Fraud

Manual Detection

Monitoring coupon sites on daily basis is the brute force, painstakingly time consuming method of finding leaked affiliate codes. Once you spot an affiliate’s code, you can quickly deactivate the leaked code and reissue a new one. Assuming the affiliate is not the source of the leak, you may get another week of protection. 

LoudCrowd enables you to deactivate and reissue affiliate codes automatically within the platform, in seconds. 

Look for abnormal activity

If an affiliate is driving a ton of revenue and fits into any of the below buckets – there’s potentially affiliate / coupon fraud at play:

  • Has a follower count and/or engagement rate that’s disproportional to sales
  • Does not post content online related to your brand

Thankfully, LoudCrowd’s integrations with social channels allows you to quickly compare affiliate revenue with social media stats and posting activity. Spotting affiliate fraud is an easy task with LoudCrowd. 

Assume coupon leaks

You should assume that a degree of coupon code fraud will happen. Posting alternative promotions or even partnering with a coupon site may help you mitigate margin losses.

How Can I Stop my Affiliate and Referral Codes from Being Leaked to Honey, RetailMeNot, and Rakuten? 

LoudCrowd recognizes that brands are losing substantial margin on leaked affiliate and referral codes. To help protect your affiliate & creator programs, we developed Codeless Affiliate Discounts – our solution to abuse from Honey, RetailMeNot, and Rakuten. 

With Codeless Affiliate Discounts – creators still receive a personal discount to offer their audiences. But, the discount is automatically conferred by an affiliate’s referral link and requires no code at all.

Codeless affiliate discounts prevent coupon fraud from leaked affiliate codes without taking away the personalized nature of name codes

At the same time, Codeless Affiliate Discounts still provide the personalized and special feeling that a traditional ‘name code’ offers both the affiliate and consumer. Discounts applied via a creator’s affiliate link see a special note indicating that the creator gave them an exclusive discount.

On the cart page:

The codeless affiliate discount prevents Honey from scaping the discount from the cart page

On the checkout page:

The codeless affiliate discount prevents Honey from scaping the discount from the cart page

Because no code is involved – Honey, RetailMeNot, Rakuten, and other poaching coupon sites cannot abuse your affiliate and influencer programs. 

Setting up Codeless Affiliate Discounts is as easy as clicking “Add Link Discount” and toggling the settings for the discount (type of discount, percentage, etc.) within an existing affiliate or Storefront program in LoudCrowd.

This is game changing for brands looking to protect their affiliate programs from fraud and coupon code abuse. Stop wasting your marketing dollars on undeserved commissions and add Codeless Affiliate Discounts today.

Already work with us? Get started by contacting your dedicated account manager. If you’re new to LoudCrowd, book a demo with an affiliate marketing expert, to learn more. 

Learn More About Affiliate Marketing with LoudCrowd

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