As an affiliate marketer in the lead generation space, understanding the difference between lead scrubbing and lead shaving is important for optimizing your campaigns and ensuring fair compensation for your work. While both practices can impact your commissions, lead scrubbing is considered an ethical and necessary process, while lead shaving is an unethical tactic used by some networks and advertisers to increase their profits at your expense.
In this article, we'll analyze the topics of lead scrubbing and lead shaving, providing you with the knowledge and strategies needed to protect your business and maximize your earnings.
What is lead scrubbing?
Lead scrubbing is the process of removing non-legitimate leads from a campaign before they are counted as conversions. Non-legitimate leads can include:
- Fake email submissions
- Inaccurate or incomplete information
- Duplicate submissions
- Fraudulent activity
- Leads generated through spammy or unethical methods
Affiliate networks and advertisers invest in software with sophisticated anti-fraud algorithms to identify and remove these non-legitimate leads, ensuring that they only pay out commissions on valid, high-quality leads. While it can be disappointing for affiliates when a lead they generated is flagged as non-legitimate, lead scrubbing plays an important role in maintaining the integrity and sustainability of the lead generation ecosystem.
Why is lead scrubbing necessary?
Lead scrubbing is important for several reasons:
- Advertiser protection: By removing non-legitimate leads, advertisers can ensure that they are only paying for leads that have the potential to convert into customers, protecting their return on investment (ROI).
- Offer sustainability: If advertisers were required to pay for every lead, regardless of quality, many lead generation offers would become unprofitable and ultimately disappear, reducing the opportunities available to affiliates.
- Ensuring quality: Lead scrubbing encourages affiliates to focus on generating high-quality leads, as they know that only legitimate leads will be counted towards their commissions.
- Maintaining industry standards: By upholding certain quality standards, lead scrubbing helps maintain the reputation and trustworthiness of the affiliate marketing industry as a whole.
What is lead shaving?
In contrast to lead scrubbing, lead shaving is an shady practice where an affiliate network or advertiser intentionally removes legitimate leads and withholds commissions from affiliates. This is done solely for the purpose of increasing the network or advertiser's profits at the expense of the affiliate.
How does lead shaving work?
Lead shaving can occur in several ways:
- Withholding commissions: A network or advertiser may simply not pay out commissions on a percentage of legitimate leads generated by an affiliate.
- Offering inflated payouts: Some networks may attract affiliates with above-market rate payouts, only to shave a percentage of the affiliate's revenues to compensate for the higher payout.
- Selective shaving: In some cases, affiliate networks or advertisers may shave the leads belonging to certain affiliates while paying out full commissions to others, often based on factors such as the affiliate's size or relationship with the company.
The impact of lead shaving on affiliates
Lead shaving can have a big impact on an affiliate's earnings and overall business. For example, if an affiliate generates $10,000 in revenue and the network or advertiser shaves 10% of that revenue, the affiliate loses out on $1,000 in rightfully earned commissions. Over time, this can add up to substantial losses and make it difficult for affiliates to maintain profitable campaigns.
Protecting yourself from lead shaving
As an affiliate, there are several proactive steps you can take to minimize the risk of falling victim to lead shaving:
- Split test between affiliate networks: Promote the same offer across multiple affiliate networks and compare key performance indicators (KPIs) such as earnings per click (EPC) and conversion rates. Ensure that you are testing the same offer page variations for accurate results.
- Prioritize quality over payout: Don't get distracted by offers with the highest payouts. Instead, focus on offers with solid conversion rates, as a lower-paying offer with a higher conversion rate can ultimately be more profitable than a high-paying offer with poor conversions.
- Partner with reputable companies: Build relationships with networks and advertisers that have a proven track record of ethical practices and fair treatment of affiliates. Look for companies with positive reviews and a strong reputation within the industry.
- Deliver high-quality leads: Invest time and effort into creating compelling landing pages, preselling visitors, and using whitehat methods to generate leads and sales. When advertisers and networks recognize the quality of your traffic, they may reward you with higher payouts, exclusive offers, and other benefits.
- Be cautious of large affiliate networks: Some large affiliate networks with big overhead costs may rely on lead shaving as a business model to maintain profitability. Be wary of working with these companies and do your due diligence before partnering with them.
- Monitor your campaigns closely: Regularly review your campaign data and look for any discrepancies or unexpected changes in your conversion rates or commissions. If you suspect lead shaving, reach out to your network or advertiser for clarification and consider exploring alternative partnerships if necessary.
Best practices for generating high-quality leads
To minimize the risk of lead scrubbing and attract the attention of top networks and advertisers, focus on generating high-quality leads:
- Use targeted landing pages: Create landing pages that are tailored to your specific audience and offer. Use compelling copy, visuals, and calls-to-action (CTAs) to encourage visitors to convert.
- Use ad creatives that presell your visitors: Before directing visitors to the offer page, provide valuable information and context that helps them understand the benefits of the offer and primes them for conversion.
- Use whitehat traffic sources: Focus on generating traffic through whitehat methods, such as search engine optimization (SEO), content marketing, and paid advertising on reputable platforms.
- Prioritize user experience: Ensure that your landing pages and offer pages are user-friendly, easy to navigate, and provide a seamless experience for your visitors.
- Continuously optimize your campaigns: Regularly analyze your campaign data and make data-driven optimizations to improve your conversion rates and lead quality over time.
The importance of building strong relationships
In the affiliate marketing industry, building strong relationships with networks, advertisers, and other affiliates can be a key factor in your long-term success. By establishing yourself as a reliable and trustworthy partner, you can unlock opportunities for pay bumps, exclusive offers, and even direct partnerships with advertisers.
To build strong relationships:
- Communicate openly and professionally: Maintain open lines of communication with your partners and address any concerns or issues professionally and constructively.
- Deliver consistent results: Consistently generate high-quality leads and sales to demonstrate your value as a partner.
- Share insights and knowledge: Contribute to the affiliate marketing community by sharing your experiences, insights, and strategies with others.
- Attend industry events: Participate in affiliate marketing conferences, meetups, and other events to network with potential partners and stay up-to-date on the latest industry trends and best practices.
Expert insights from Stefan Muehlbaeur
To dig deeper into the topic, we gathered some more knowledge bombs from the most recognized and reputable affiliate manager in the industry, Stefan Muehlbaeur - the owner of Affpal.net and the Head of Business Development of the “Masters in Cash” dating affiliate network
Stefan, could you explain the difference between lead scrubbing and lead shaving for affiliates to understand?
Scrubbing is the removal of invalid leads. These can be clearly fake leads or leads that do not follow the company's restrictions. This can happen automatically or after a manual check. Shaving is when the program or network is not reporting legitimate leads.
As an affiliate manager, have you ever handled a case of lead scrubbing?
Yes, as a CPL-focused Affiliate Program, Masters in Cash has to deal with this situation. Leads not following the rules are automatically removed, for example, wrong GEO targeting (we offer Smartlinks for affiliates who want to avoid that). For fraud, we get reports that we send to the affiliate before we deduct. These reports contain only a few patterns to not reveal our methods, but enough for every affiliate to understand that it's fraud.
How do you determine what constitutes a "legitimate" or quality lead vs one that should be scrubbed? What data points do you consider?
That's a dynamic process, and we permanently update our methods. For example, when we started our CPL business, we mostly checked what percentage of the DOIs were becoming paying users. Fraudulent affiliates would make the smallest purchase for every few leads, and everything seemed great. This stuff would not fly anymore. Now it's a combination of around 60 data points that we monitor. A combination of a few of them triggers the alerts.
What is the appeal process if an affiliate believes a lead was improperly scrubbed? How often are appeals successful?
The key to a successful partnership is open communication. So, if an affiliate thinks the deduction was not right, they should ask for a small piece of proof. Nobody will give all insights, but there are always points to share and make a case. Advertisers and programs are very careful before deducting, so in most cases, it is super legit. I can only remember one case within 14 years where a bigger deduction was made, and it was all an error by the advertiser. This affiliate was a big opinion leader and made a huge drama, causing many checks, and in the end, it turned out to be legit.
What are your opinions on lead shaving, and why do some affiliate networks do that?
I don't think it should be part of the business model. Often it's not even about maximizing network profit; it's just to give the affiliates more appealing payouts. That is not making things better. Here's an example: CPL is 5€ with a 10% conversion rate (CR). After 1000 clicks, the affiliate has 500€ and 100 leads, which is data, the most important currency of the 21st century. If we bump the payout to 10€ and the CR drops due to shaving to 5%, the affiliate will still have 500€ after 1000 clicks but only 50 leads. The affiliate now has only half the data to make decisions about their campaigns.
Conclusion
And there you have it lads. Understanding the difference between lead scrubbing and lead shaving is important for any affiliate marketer in the lead generation space. While lead scrubbing is a necessary process that helps maintain the integrity and sustainability of the industry, lead shaving is an unethical practice that can significantly impact your earnings and overall business success.
By taking proactive steps to protect yourself from lead shaving, focusing on generating high-quality leads, and building strong relationships with reputable partners, you can create a sustainable and profitable affiliate marketing business.
Stay informed, adapt to industry changes, and always prioritize the quality of your leads to maximize your success in this industry.
