Traffic arbitrage: fraud or not - expert opinions

Traffic arbitrage: fraud or not - expert opinions
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Traffic arbitrage is a scam or not – expert opinions

Traffic arbitrage is a customer acquisition process in which webmasters are rewarded with a percentage of the sales made. In this process, webmasters set up advertising campaigns and make money. However, for beginners, this path can seem complicated and overflowing with subtleties, and sometimes even look like a scam. Let’s find out under what circumstances traffic arbitrage can be a scam and who becomes a victim.

Situations when traffic arbitrage is a scam for webmasters

Traffic arbitrage: fraud or not - expert opinions

Newbies in arbitrage often face the fact that their starting budget goes nowhere without attracting a single client. This outcome may seem like a scam to webmasters who don’t see the expected return on their efforts. But in fact, this is a typical and expected result. Even experienced arbitrageurs have unsuccessful campaigns. Arbitrage requires precision: any mistake can lead to loss of funds. Key aspects of success include choosing the right offerer, testing creatives, and the ability to optimize ad campaigns. To minimize risks at the initial stage, it is recommended to limit the size of the investment.

However, there are cases when a webmaster does fall victim to fraud, such as when there is shaving by an affiliate program. This means that CPA networks can artificially underestimate the amount of traffic or reject real sales without paying the webmaster his earnings. To avoid cooperation with unreliable affiliates, it is important to study the ratings of CPA networks, where proven and reliable affiliate programs are listed.

Situations when traffic arbitrage is a scam for consumers

Traffic arbitrage: fraud or not - expert opinions

Scenarios when traffic arbitrage turns out to be a scam for consumers

Traffic arbitrage can overstep the bounds of legality when webmasters intentionally mislead advertisers and consumers. This is often associated with so-called black arbitrage, examples of which include:

  • Betting and gambling jobs: Here, webmasters promote betting companies and online casinos, getting paid for each referred customer who deposits or generates revenue through a rev-share scheme. Since the main goal of these companies is to make money from users, any assistance in this process can be considered as participation in a fraudulent scheme.
  • Failure to deliver on promises: This point is also common in the gambling industry. Newcomers to arbitrage may use questionable methods to attract traffic quickly, including promises of “no-win strategies” or “guaranteed ways to win” that end up causing gullible users to lose money.
  • Dealing with Deceptive Offers: In some cases, the advertiser itself can be a source of fraud by offering products or services that are not as advertised. An example would be sending a low-quality product instead of the promised quality product. The webmaster promoting such offers may not be aware of the fraud but is nevertheless involved in the process.

These examples emphasize the need for a careful approach to selecting traffic arbitrage offers to avoid trouble for both yourself and consumers.

Situations of cheating affiliate programs and advertisers in arbitrage

In the process of traffic arbitrage, there may be times when arbitrageurs act dishonestly with affiliate programs and advertisers. Cheating can occur in such cases as:

  • Misconfiguring advertising campaigns: Webmasters may place ads in places that were explicitly forbidden by the advertiser, such as through push notifications.
  • Use of incentivized traffic: Referrers attract people who are rewarded for performing certain actions, such as registering or viewing ads. This method of customer acquisition involves paying for actions that have no real value to the advertiser, as the users’ motivation is based on receiving a reward rather than interest in the product.

Such methods, while they may increase the arbitrageur’s performance in the short term, are not profitable for advertisers in the long term, as users attracted in this way do not show loyalty to the product or service.

Сергій Кравченко

Lead Panda is a highly skilled internet marketing and SEO expert with years of experience. With a successful track record in creating and implementing digital advertising strategies for various businesses, we are always eager to share our knowledge and best practices with other industry professionals by providing valuable information and advice on our website.
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