Data Privacy in Affiliate Marketing: Best Practices for Protecting Customer Information  

Affiliate marketing is ideal for spreading the word about your brand and getting people talking about your products or services. By collaborating with others, you’re presenting your goods and services to a new audience of potential customers.  

But because this process involves collecting, using, and sharing personal information from those customers, you must follow specific requirements outlined by applicable laws and keep that information safe from unauthorized access and other cybercrimes.    

Below, learn about why data privacy matters in affiliate marketing and the best practices you can implement today to protect your customer information at every level.  

Why Data Privacy Matters in Affiliate Marketing  

While it might not be obvious, affiliate marketing can involve collecting and exchanging personal information from consumers, especially from those who click on affiliate links. Several data privacy laws consider this a form of data processing, and it is heavily regulated, making data privacy an essential part of the process.  

When a consumer clicks on an affiliate link, it typically redirects them away from the original website. It brings them to a page on the business’s website where they can purchase whatever the affiliate was advertising.  

Clicking on the link might lead to exchanging personal information about that consumer between your business website and the affiliate. For example, the new site might immediately place analytics cookies on the user’s browser so the business can track which link brought them to the site in the first place.   

To meet the requirements of applicable laws and avoid getting fined or facing criminal penalties for noncompliance, you must ensure your affiliate marketing policy is legally sound and adequately protects customer information from unauthorized access, breaches, and other threats.   

Privacy Laws That Might Impact Your Affiliate Marketing  

Speaking of privacy laws, the following might apply to your business depending on varying factors, like the location of you and your consumers, and they all impact affiliate marketing:   

• General Data Protection Regulation (GDPR): Even though this is a European law, it applies to any business whose services are available in the European Union and monitors online behaviors. It requires you to present users with a clear privacy notice and to obtain adequate opt-in consent before data collection occurs, including for users who end up on your site after they click on an affiliate link.   
• California Consumer Privacy Act (CCPA): This California state-level law requires you to allow users to opt out of selling or sharing their personal information, which includes any of their data you might share with an affiliate partner.   
• California Online Privacy Protection Act (CalOPPA): Another California state-level law, it set the original standards for what details must go into a privacy policy. For example, if you perform affiliate marketing and collect or share data with the affiliate, you must clearly say so in your privacy policy. 
• Children’s Online Privacy Protection Act (COPPA): This federal law protects children under 13. If one of these minors clicks on an affiliate link and ends up on your site, you cannot collect their information without first obtaining opt-in consent from their legal guardians. You must also explain in your privacy policy how they can contact you if they believe you accidentally collected data about their child.   
• Colorado Privacy Act (CPA): This Colorado state-level privacy law is similar to the CCPA but unique in that it applies to nonprofits. Under this law, you must give users a clear privacy notice describing how you use their information for affiliate marketing.   
• Virginia Consumer Data Protection Act (VCDPA): Like the CPA and the CCPA, this Virginia state law requires covered entities to inform consumers if and how their data is being used, including for affiliate marketing.   

Take the time to identify all privacy laws your business is subject to, and always keep those legal requirements at the forefront of your mind, especially when performing affiliate marketing. Otherwise, you could face significant fines for violating data privacy laws.  

Best Practices to Protect Customer Information  

It’s apparent that data privacy and keeping customer information is important, but businesses often feel confused about what steps to take to keep user data safe and secure.   

Below, I’ve compiled a list of best practices you can implement on your platform today to help you protect customer information better.   

Always Be Transparent  

Your business must have a section on your website that clearly explains your affiliate marketing program to customers so they know exactly how it works and what personal information from them is used or shared.   

For example, you might have a disclaimer, a clause in your privacy policy, and a clause in your terms and conditions agreement outlining your affiliate marketing program details.   

In the U.S., the Federal Trade Commission (FTC) regulates this via its rules, impacting businesses and affiliates. According to the FTC Endorsement Guidelines, affiliates must meet the following transparency requirements:   

• Disclose their relationship with the brand 
• Use words like ‘sponsored’ or ‘paid ad’  
• Post disclosures near any affiliate links  
• Disclose any payments, free products, or services received  
• Ensure the claims they make are truthful and based on evidence  

Create (and Sign!) Adequate Contracts with Affiliate  

First and foremost, always ensure your affiliates are signing contracts or affiliate agreements and have access to your guidelines, holding them to the same high standards you hold yourself to.   

Your business might not be able to control the behaviors and choices of the affiliates you work with, but you can request they sign a contract or read guides to get everyone on the same page and to ensure they follow the necessary legal guidelines and requirements.   

In the contract, you can explicitly ask them to:   

• Transparently inform their users that they use affiliate links,   
• Inform users that clicking on the link might provide them with some form of compensation and  
• It will lead them away from the original site to your business site, where data collection might occur.  

Keep Data Collection to a Minimum  

Another easy way to protect consumer data is to keep your data collection to a minimum. Entities that store excessive amounts of data are at a higher risk of becoming the victim of a cyberattack, like a data breach or leak.  

A good rule of thumb is to only collect personal information necessary for specific, clearly defined purposes — this is also a requirement of several different data privacy laws that could impact your business.   

While data collected from affiliated marketing is typically minimal, this is a best practice you can apply across all other facets of your business.   

Manage Consumer Consent  

Your website must manage consumer consent for data processing in a legally compliant manner, including from the website visitors who end up on your page by clicking an affiliate link.   

If laws like the GDPR protect them, you must request their consent using a tool like a cookie banner before data collection begins. Under laws like the CCPA, you must give consumers the right to opt out of having their information shared or sold to third parties, such as the affiliates you work with.    

Consider using a managed solution like Termly to make this process easier for your business. This way, you don’t have to spend time and energy on the technical side of manually making a legally sound consent banner and preference center. Instead, you can easily configure a banner based on the laws that govern you. 

Be Honest in Your Privacy Policy and Other Legal Documents  

Another way to protect consumer information is to be transparent with users about the data you want to collect and how you want to use it.   

Presenting your consumers with an accurate privacy policy allows them to make an informed decision about using your platform, which gives them real choice and control over their personal information.   

For example, a clause in your privacy policy should explain that your website performs affiliate marketing. State what consumer data might be shared with those affiliates, the purpose for sharing that information, and your consumers’ rights over it.   

Keep in mind that some privacy laws also require privacy policies, and if those apply to you, you must meet all notification guidelines, or you risk getting fined for noncompliance.   

Implement Strong Access Controls  

While this applies more to behind-the-scenes data storage systems than specifically to your affiliates or their marketing links, it’s essential that your business limits who can access the personal information it collects and stores.   

By limiting who can use and interact with the information, you’re protecting its confidentiality and maintaining its integrity, which are both requirements of laws like the GDPR.   

In addition, you should store the data behind a strong password and implement multi-factor authentication. Otherwise, the data is vulnerable to being illegally accessed and leaked.  

Audit All Affiliates and Third-Party Services You Use  

Your business should have a plan to regularly audit all affiliates and all third-party services you work with for security and legal compliance issues.  

If someone is going to endorse your product on their website, it’s a good idea to create a plan to regularly audit them to adequately vet them for security risks, data privacy issues, and other gaps that could lead to harming your business or consumers.  

Ending relationships with any affiliate that’s too risky or no longer in line with your policies helps you better protect your customer’s information.  But this also helps your business because terminating contracts with partners that no longer align with your mission or vision allows you to maintain more control over your brand and how it’s perceived online.  

In addition, you should also investigate platforms like any affiliate tracking software, customer relationship management (CRM) tools, and ad and analytics services you’re using for security gaps, weaknesses, and privacy compliance issues. Make sure you always update this software in a timely manner to prevent cyberattacks  

Encrypt Consumer Information  

If you store data, whether from affiliate marketing or elsewhere, you should encrypt it, a common security mechanism used by businesses and is recommended in privacy laws.   

Data encryption is when you scramble the information so it’s random and can only be read with a key. Hackers need to access both the data and the key to actually understand the datasets.   

It’s an easy safety measure to implement and can help you out a lot, especially if the data is ever accessed by someone unauthorized but without the key. In this scenario, they wouldn’t be able to understand the data, making it useless to steal or try to leak to the public.  

Train Your Team  

Knowledge truly is power when it comes to keeping your consumer data safe. The best way to prevent data privacy issues from occurring is to train your entire team so everyone is on the same page and knows how to confidently and compliantly react and respond.   

For example, you can participate in webinars, read blogs or educational resources, sign up for privacy compliance newsletters, or participate in courses and training from services like Wizer or KnowB4, Inc.   

Members of your team who handle high amounts of consumer data might also consider getting different Data Privacy Certifications from groups like the International Association of Privacy Professionals (IAPP) or the International Information System Security Certification Consortium (ISC2).  

This is a rapidly changing industry, so incorporate privacy literacy training each year to keep up with the most recent and relevant recommendations and guidelines.  

Key Takeaways: Protecting Consumer Information  

Affiliate marketing has many perks, but for it to be sustainable on our growing and evolving Internet, businesses must do what they can to protect consumer personal information from bad actors who want to hack into data sets without authorization and use them illegally.   

For consumers, leaked data can be catastrophic. It can cause identity theft, financial ruin, personal humiliation, and other forms of harm. Since collecting and using data is such a monumental responsibility, privacy laws and consumer protection groups like the FTC do what they can to regulate the industry to provide protection and security for consumers and businesses alike.