Have you ever received a discount for subscribing to a brand's newsletter? Maybe you’ve been given a bonus for inviting friends or staying loyal as a customer. If so, you already know what incentive marketing is — from firsthand experience.
Incentive marketing is a strategy where a company offers rewards — such as discounts, bonuses, or gifts — to encourage specific customer actions like purchases, sign-ups, or referrals. Simply put, the customer gets a benefit in exchange for doing something valuable for the brand.
Let’s look at some examples of incentive advertising techniques that brands apply to their customers:
• Welcome discounts. Brands often offer a discount (like 10% off) when someone signs up for a newsletter or places their first order.
• Loyalty rewards for repeat purchases. Customers earn points, cashback, or gifts for buying again — encouraging them to return.
• Referral programs. People get rewarded when they invite friends who make a purchase or sign up.
• Gifts or discounts for reviews and surveys. Brands offer small incentives in exchange for customer feedback or product reviews.
• Exclusive offers for loyal customers. Special access to sales, early product launches, or limited-time deals just for returning buyers.
It’s not only customers who can be motivated to bring value to a brand. Businesses also apply incentives to their partners. For example, affiliates, agents, and distributors.
• Performance-based cash bonuses. Partners earn bonuses for hitting sales targets or exceeding quotas.
• Higher payouts for quality traffic. In affiliate marketing, brands reward partners who bring in high-converting or high-value leads.
• Exclusive benefits for top-tier partners. High-performing partners get better commission rates, priority access to products, or branded content support.
Seems like a win-win strategy, doesn’t it? The problem is some customers or partners may use incentives to profit off of the brand. And it’s usually hard to detect abuse without brand compliance software. Incentive marketing fraud usually happens in several ways:
Uncontrolled affiliate activity. Without a brand compliance policy and proper monitoring, affiliates may violate program terms — such as bidding on the brand’s keywords in paid search ads, misusing logos, or promoting through unauthorized channels. This not only inflates acquisition costs but also damages brand trust.
Click fraud and fake traffic. Some partners violate brand compliance and use bots or click farms to simulate traffic or conversions, tricking the brand into paying commissions or bonuses that weren’t earned. Fake referrals. Some users create multiple fake accounts to trigger referral bonuses, essentially rewarding themselves with no real customer acquisition. For example, one person could register five fake emails just to get five “new customer” discounts.
Coupon code leaks and abuse. Promo codes meant for exclusive audiences — like newsletter subscribers — often end up on public coupon sites, where anyone can use them. As a result, brands lose margin on orders that were already going to happen.
In all these cases, brands lose money. What’s more they risk damaging their reputation and rewarding the wrong behaviors. That’s why incentive advertising should always go hand-in-hand with clear rules and brand compliance software.
Brand compliance software helps companies using incentive marketing stay protected by monitoring partner activity and detecting fraud. Let’s break this down in more detail to understand how to protect your brand.
The Role of Incentive Marketing in Brand Protection
• Incentive advertising can build customer loyalty and protect a brand:
• Incentives like points, cashback, or free gifts encourage customers to buy again, creating habit and brand attachment.
• When customers or partners receive a reward, even a small one, they feel appreciated — which strengthens emotional loyalty.
• Tiered loyalty programs motivate customers to stay active over time to unlock better rewards.
• Referral incentives turn loyal customers and partners into brand advocates by rewarding them for bringing in new buyers.
• When rewards are clear, fair, and delivered reliably, customers and partners learn to trust the brand and stay loyal.
How does smart use of incentives reduce fraud risks? The strategy is to form a solid base of loyal customers and partners who feel appreciated and want to keep cooperating with the brand. With a clear brand compliance policy and brand monitoring software, businesses can reward real value without opening the door to fraud. Here are some examples of brands that successfully use incentive advertising programs:
💼 Amazon Associates. Amazon runs one of the world’s largest affiliate programs with strict rules, automated link tracking, and regular content moderation. Affiliates earn commissions only for confirmed purchases, and violations of brand compliance like unauthorized PPC bidding are strictly prohibited.
🛒 Shopify Affiliate Program. Shopify offers incentive payouts for referring new customers, but requires affiliates to apply, be approved, and follow specific marketing guidelines. Unique tracking links, detailed reporting, and traffic quality checks ensure brand compliance.
🧩 Adobe Affiliate Program. Adobe runs its affiliate program through the Impact network with transparent terms: payouts for qualified actions only, no unauthorized promotions, and regular partner reviews. All activity is tracked via brand compliance software to ensure ad fraud detection.
Risks of Incentive Marketing Without Brand Compliance Software
There are several risks associated with using marketing incentives without brand monitoring software:
Affiliate fraud. Without compliance software, it’s easy for fraudsters to game the system. Some affiliates generate fake leads using bots or create fake accounts to claim referral rewards. These actions lead to wasted payouts, distorted analytics, and inflated performance reports.
Example: A brand offers affiliates a bonus for generating a high volume of leads. One affiliate uses fake data and automated scripts to quickly submit hundreds of fake sign-ups that look real at first glance. As a result, the brand pays out a large bonus for leads that never engage or convert — wasting budget and skewing performance data.
Fake incentive programs. If you don’t track how your incentive offers are being promoted, affiliates can create fake landing pages or discount codes that look official — but aren’t. These fake offers confuse customers and erode trust in your brand.
Example: A fraudulent website publishes a fake "20% off" coupon for your brand, which spreads on social media and coupon sites. Customers try to use the code, the fake marketing incentive doesn’t work — and they blame your brand for the “scam.” As a result, the brand gets negative reviews and loses customer trust.
Unauthorized branding. Some affiliates can use branded keywords even though the brand’s compliance policy prohibits trademark infringement. This way they generate cheap leads that easily convert into real customers. The problem is that those customers would have bought from the brand anyway, and the affiliate had nothing to do with it.
Example: A user searches for “BrandX official site” on Google and clicks on the first ad — which looks like it's from the brand but is actually run by an affiliate. The user makes a purchase, and the affiliate gets a commission for a sale they didn’t influence in any meaningful way.
Brand monitoring software acts like a 24/7 watchdog. It monitors how your brand and promotions are being used online, detects rule violations, and flags suspicious affiliate behavior before it turns into damage. It ensures that only legitimate partners get paid and helps protect your brand from fraud, confusion, and financial waste.
How Brand Compliance Software Protects Your Brand
Marketing incentives drive growth but also increase risks. Let’s see how monitoring software can protect your brand:
Monitoring and detection. Brand compliance tools constantly monitor how your brand is used in search ads, affiliate campaigns, and coupon websites. They detect suspicious activity like brand bidding, fake traffic, or misuse of marketing incentives — often before it causes serious damage.
Affiliate verification. Before allowing partners into your program, compliance software helps verify their identity, traffic sources, and promotional methods. This reduces the risk of working with fraudulent or low-quality affiliates from the start.
Ad fraud prevention. The software flags unauthorized or misleading ad creatives, especially in paid search. If an affiliate runs ads that mimic your brand or use restricted keywords, you’re notified immediately — protecting your brand reputation and ad budget.
Compliance reports. An unseen advantage of monitoring software over manual monitoring is automated reports compiling. These reports help you quickly identify violations, provide evidence when enforcing policies, and make informed decisions about which partners to keep or remove.
Best Practices for Safe and Effective Incentive Marketing
Here are some ways to make marketing incentives safe and effective:
Use brand compliance software to monitor partners. Those tools are essential for maintaining control over your incentive advertising efforts. Brand compliance monitoring allows you to track how affiliates, resellers, or agents represent your brand across various platforms — from paid search ads to coupon sites. These tools help with ad fraud prevention as they detect trademark misuse and unauthorized campaigns.
Create transparent incentive policies. Define exactly who qualifies for rewards, what actions trigger them, when payouts happen, and what behaviors are unacceptable. When expectations are straightforward, it discourages intentional abuse while making it easier to enforce rules fairly using brand monitoring software.
Educate affiliates on brand compliance guidelines. Even the best affiliates can unintentionally break rules without guidance. That’s why it’s important to provide detailed brand usage standards, sample creatives, and a list of what’s allowed and what’s not. Welcome kits, live sessions, or FAQs can help keep everyone aligned with your brand values and policies.
Perform regular audits and fraud checks. Ad fraud detection shouldn’t be a one-time effort. Conduct routine checks on traffic quality, conversion sources, and partner activities to spot irregularities. Use brand monitoring software to catch red flags early and prevent small issues from escalating into bigger problems.
Incentive Marketing Examples: How Top Brands Protect Their Programs
Let’s have a look at one of the incentive marketing examples and what brands can do to protect their reputation and budgets.
Starbucks encountered significant brand safety issues within its incentive program. Criminals exploited vulnerabilities in the Starbucks mobile app to take over customer accounts, leading to unauthorized access to personal and financial information.
Hackers took advantage of the auto-reload function of Starbucks gift cards and mobile payments, which resulted in unauthorized withdrawals from customers' linked credit or debit cards. The abuse of marketing incentives not only caused financial losses but also significantly damaged customer trust.
To combat this, Starbucks partnered with Shape Security, part of F5, to deploy advanced brand compliance monitoring software aimed at detecting and preventing such fraudulent activities. This proactive approach resulted in a reduction in fraud incidents, restoration of brand safety, and enhanced protection of the brand's reputation.
Such incentive marketing examples prove that working on customer loyalty is impossible without fraud prevention. Otherwise, all the efforts may backfire and damage the brand’s reputation and finances.
Strengthen Your Brand Protection with Smart Incentive Strategies
Incentive marketing works best when it’s secure, transparent, and well-controlled. Without compliance monitoring tools, incentive marketing becomes a risk. With the right software, it becomes a powerful growth strategy. Smart use of marketing incentives can protect your brand and form an army of loyal customers and partners.
