If you don’t know the technical side of fraud detection, it’s easy to think that it’s either magic or guesswork.
Thankfully for marketers, it’s neither. It’s computer science based on real data that stands up to scrutiny and describes digital transactions that do their best to trick you in order to make a quick buck.
Understanding what makes it tick lets you make the most out of a powerful tool that protects your budget by weeding out fraudulent leads. Knowing how to use fraud detection tools lets you improve your CRM data quality, saves you time from chasing down phony leads and lowers the risk of lawsuits when you’re tricked into TCPA violations.
Why use fraud detection tools?
First and foremost, you want to use fraud detection tools to protect your ad budget and to prevent fraudulent data from getting into your CRM system.
What do fraud detection tools do?
Good fraud detection tools include “active monitoring” of your ads’ landing pages.
What are the benefits of active monitoring?
- Detect fraud and report it in real time. It lets you tell the good leads from the bad ones.
- When you know which leads are bad you can focus your time and energy on the good ones.
- You can reject fraudulent leads in real-time so you do not pay for them.
- You can stop retargeting fraudulent clicks and leads.
- Get a better measure of the true value of your targeted audience groups.
- In the case of digital sales, you can prevent the loss of the product’s value due to fraudulent purchases.
- Prevent charge backs and reputation damage at your payment processor.
How does fraud happen?
Whoever published your ad – it’s often an affiliate with a third party site, social media presence, newsletter redistributor and so on – makes money for every potential customer they send you.
It’s not hard to realize that someone up to no good can cheat the system to make more money off of you by sending you more leads – leads they know are no good.
But why are some of my leads good and some are bad?
Because thieves are good at their jobs – they know that if they fake everything, you’ll catch them quickly. So they get real human leads and mix in cheap, fraudulent traffic – there have been so many data breaches lately that stolen data isn’t hard to come by.
By mixing the bad in with the good, they keep stringing you along while they line their pockets.
And while they’re lining their pockets with fraudulent lead generation generated by bots, click farms, and sweatshops, you won’t ever see a return!
Since fraudsters keep making money if they’re good at tricking you, they put a lot of effort into it, so you end up making a phone call to a potential customer without ever detecting the fraud. And they’re sophisticated at it, too. They use real people working in sweatshops using anonymous browsers to submit stolen, valid contact information. Most of that can be bought on the dark web pretty inexpensively and it includes names, addresses, area codes and zip codes that all match. Then they use a VPN or other setup to spoof their IP address to make it look like they’re close to the person whose stolen data they just submitted.
Why don’t most tools detect that kind of fraud?
Because they were built a long time ago and back then, this kind of trick was hard and expensive. Now it’s cheap and easy to make it look like everything matches up. That makes that old technology think that everything checks out when it’s really fraud.
Who cares if I call the wrong lead?
Your lawyer sure does – so does your boss, the courts and your finance officer! Every time you call someone who did not give express consent to have you call them, you are violating the TCPA. Whether you meant to violate the law or not, each one of those calls carries a risk of a fine up to $1500. Those add up fast, and you better believe the government as well as class action lawsuit attorneys have figured out how much you’re going to have to pay.
Let’s look at a typical marketing/ sales funnel. The layers represent how customers are attracted, engaged, converted and/or, if applicable, closed on the digital sale. Attracting customers is mostly done through third parties. Unfortunately, their interests are not always 100% aligned with your interests, as you pay primarily for quantity in the form of traffic (CPM, CPC) and/or submitted leads (CPL, CPA). The quality of the clicks and leads is the risk you take. Without a fraud detection tool, that risk exposes you and your company to lawsuits and fines.
So what can a marketer do?
Long story short, you need to have your landing pages actively monitored with a modern fraud detection tool like SecureLead by Oxford BioChronometrics.
SecureLead lets you:
- Detect fraudulent clicks, leads and transactions.
- Save your budget because you can reject fraudulent traffic in real-time
- Prevent fraudulent data from entering your CRM
- Mitigate the litigation risks of contacting someone without express consent
- Keep your data clean, which lets you both reoptimize and/or scale you campaigns efficiently and effectively
- Align your interests with the interests of your affiliates or traffic providers. Quality is continuously monitored so, if they want to make money, they will have to provide quality traffic. If they don’t provide you with quality they won’t get paid.