High Noon for Click Fraud

by Scott , Chris Bowler, Mar 23, 2005, 7:00 AM

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Search engine marketing has proven to be a digital gold rush, producing riches beyond the most optimistic predictions of a few years ago. But just as the gold rush of the Old West attracted con men, counterfeiters, and claim jumpers, the search engine gold rush has spawned its own breed of outlaw  the click fraudster.

Simply put, click fraud is the action of clicking on an advertisement where the user has no intention of interacting with, or transacting on, the destination Web site. It's any click not made in "good faith." Devoid of any talent or integrity, click fraudsters create artificially high click-through rates, effectively stealing from the advertisers who pay on a per-click basis.

I did not worry about this trend until a few months ago when we placed a pricey search campaign with a small, secondary search engine player. After only one week, we recorded thousands of clicks with almost no conversions - a suspicious result given a relatively high conversion from our other search engine marketing activities. More disturbing was that this was an established search vendor who performed well in the past for the advertiser.

Today, it's easier for publishers to make money in online advertising, given its current upswing, and especially in the search engine space where advertisers will pay $5 to $10 (or more) per click. Unscrupulous publishers who sign on with a search engine or an advertising network know they will be compensated for clicks they can generate to satiate the aggressive marketplace  at least until they get caught (or move on). This high-demand, fluid marketplace requires greater scrutiny around the issue of click fraud.

What to do? First, a questionable campaign requires a call to the vendor to share your concerns. Request a detailed analysis of the clicks from the campaign. In our case, the search engine expressed more skepticism than willingness to investigate. In the end we did negotiate, and receive, additional inventory at no charge. But a "make good" does not reassure us for the next campaign.

Search marketers must go further than conducting "after the fact" cleanup. I suggest these four steps:

1. Search advertisers need to take responsibility for click fraud. It's too easy to say that click fraud is an issue for the search engines to address. With search demand outstripping supply there is a huge proliferation of new companies pitching for a slice of the search marketing pie. Not all of them will be as diligent as the established search engines such as Google and Overture. And while I believe that these companies have taken steps to monitor and investigate click fraud, it's not enough to assume that their staff and software will be on top of every campaign. Consider, for example, how many times you have felt that these search engines are stretched too thin to service this high-demand industry?

2. Search advertisers (and their agencies) must put monitoring in place. Today tools are out there which will report duplicate clicks from single IP addresses or domains. These tools can be set up to alert you of multiple clicking within a short period of time - a tip-off for potential click fraud. Who'sClickingWho? is one established pay-per-click auditing service offering this capability.

3. Take out an insurance policy. Third Party Adserving companies have an opportunity here. As many search engine marketers use Adserving tracking systems and optimization tools, it would be a natural extension to offer IP address reporting. While the Adservers claim that these reports are quite data intensive to generate and house, I suggest that many advertisers and agencies (including ours) would pay extra for this reporting.

4. The industry should introduce a formal auditing and certification program. Like the Good Housekeeping "Seal of Approval" this certification would be granted to search engines that submit to regular auditing of their campaigns. This is especially crucial for small search engines that want to attract larger advertisers as well as big-name search engines that want to foster trust in their contextual advertising networks comprised of hundreds of publishers. A certification program would go beyond search engines - such a program would also be useful for networks and sites that offer pay-per-click deals to their advertisers.

Setting these safeguards in place will serve to reassure existing search advertisers as well as new, more risk-adverse marketers who are still standing on the sidelines. Just as crucial, these safeguards will help drive the click fraudsters out of town and reassure those of us who champion the search engine cause.

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