Using referral software with advanced referral tracking features is a good start to preventing fraud in your referral program.
Referral Factory has a couple of features available to help you reduce and prevent fraudulent behavior but in our experience, the best way to prevent fraud is to have a well-designed referral campaign that drives good behavior. That's why we recommend only issuing rewards based on a conversion that you find valuable - such as a purchase.
Structuring your campaign this way makes it a relatively low risk because you are only issuing referrers their reward after an event has taken place such as making a purchase or creating an account.
However, on odd occasions, you may encounter instances where users try to defraud your campaign by gaming the system and that's where our fraud detection features come in.
One of our main aims is to help you fraud-proof your campaign as much as possible. This is why we have the following two features to help you:
1. Enabling user verification in your campaign
This feature is currently only available on Pro Plans. User verification allows you to email a four-digit code to the email address that a user has used to join your campaign. The user will need to enter this code into your campaign in order to continue participating in your campaign.
This ensures that anyone joining your campaign has used a valid email address and is a legitimate user. Thus, reducing the possibility of people trying to “game” or take advantage of your referral campaign.
2. Use our suspicious user feature
This feature is useful when it comes to referral tracking because it will flag any users that could potentially be taking advantage of your campaign. Users will be flagged as suspicious if they register from the same IP address as another user, or if they use a + symbol in their email address.
You can find out more about our referral tracking and other features that you can use to get more referrals.