I want to talk about CPA network shaving and throttling. What it is, why do we have to look out for it as affiliate marketers and why would anyone do it in the first place?
So, what is CPA network Shaving?
CPA Network shaving is basically where a network will not report a certain amount of conversions intentionally. In affiliate marketing we use tracking systems and some of those tracking systems (for example cake) have the ability to shave, or “throttle”.
With a simple little setting inside of the administrative section of the tracking-software most cpa networks use have the ability to throttle conversion reporting. This means if you get a hundred conversions through your marketing efforts your network can set a throttle rate of 10% so that only 90 of your conversions would show up in your stats and you would not know any different.
If the network doesn’t tell you they are shaving then this is basically stealing. The ability to do this has been put into many CPA network tracking platforms by the companies that build the software. There are some reasons why these tracking software providers say they have the capability built-in, but none of them really make any sense when you think about it.
CPA network shaving is common in lead generation offers where using the throttle rate helps the advertisers get the target CPL. But in most cases this can be done just by adjusting a payout at the affiliate level. The throttle rate is not really there for any reason in my opinion.
How do you fight against CPA Network Shaving this if it is actually something that’s happening?
First, you need to work with trust-worthy networks. CPA networks that you know are not trying to steal money from you. It’s the good networks out there which have absolutely no reason to throttle or shave your stats,. If a CPA network shaves they’re actually shooting themselves in their own feet.
The worst thing you can do as a CPA network owner is to shave your affiliates. If your affiliates are not making money then they’re not going to work with you. If an affiliate suspects they are getting shaved, they’re going to go directly to the advertiser or with a different CPA network instead.
Any CPA networks that are shaving are likely new or weak networks with zero cash flow. If you have a suspicion that your network is shaving there’s a really easy way around it.
The first thing you can do is split test the offer you’re running on another network. Most CPA offers are available on many networks.
If you find an offer you’re running on one network and you think the conversion rate is good find the exact same offer on another network and split test them inside of your own tracking system, very simple.
You can see which network is performing better, and if one goes lower you can ask that network “why is that network converting less than the other one?” That’s one way to do it.
Another way to do it is to actually just go work direct with an advertiser. Often times you can see if there’s any discrepancies in your statistics by comparing them with figures that come directly from the advertiser compared to figures from a network. Many networks don’t like it when you go work directly with an advertiser.
When you go direct, CPA networks are losing you as an affiliate which is losing them money. This post isn’t meant to encourage you to go work direct with advertisers as there are many risks involved with that. Just know it is an option in some cases.
One of the last things that makes it evident that there’s some type of “fishiness” going on is when you have an offer that has a maximum payout on one network, then you have another network say “we will beat any payouts”. This happens a lot. Many networks are competing against each other, but when you know that the offer payout is extremely high and you get somebody that comes in with a 10% higher payout it kind of makes you wonder if there is some CPA network shaving going on, or whether the first network is taking too big of a margin!
Make sure your split testing that higher payout with the actual lower payout offer just to make sure you’re not getting tricked into a network that’s using high payouts to attract affiliates but actually shaving in the backend.
Many affiliates make the mistake of thinking that the payout is the most important thing when it comes to promoting affiliate offers but it’s not the most important thing.
The most important thing is the amount of conversions you’re getting and earnings per click. The amount of key performance indicators that are being hit in your own marketing campaigns, your landing page rates and all that stuff is vital. You’re should look at the conversion rates, the earnings per click and other stats and make your decisions from there. If somebody offers you a payout that’s super high, don’t get too excited.
For example, one time I was running an offer at $20 pay per lead and a company came and offered me $40 per lead. The funny thing is that I actually knew the advertiser and I brought it to their attention. I told them that this CPA Network is offering me $40 per lead and the advertiser responded with “we’re not even paying that CPA network $40 per lead” so it’s impossible. This meant that CPA network shaving was the only way they could pay me $40 and not be losing money.
These are the things you need to look out for. I’m not saying every CPA network shaving is common, because it isn’t.
In fact most of the time people automatically assume network shaving is the problem because it’s the “easy answer”. In fact 99% of the time it comes down to affiliates making mistakes in tracking, or the traffic source starts to send you a different quality of traffic.
If you are running a lot of Facebook traffic or native ads then this can be a common thing. Don’t assume CPA network shaving is happening. Do your research, make sure tracking is set up properly, and split test before you ever approach a network thinking they are shaving. Hopefully this will help your CPA Affiliate Marketing campaigns last longer.