• by Tanya Gazdik , February 1, 2008

The overall industry average click fraud rate rose to 16.6% for fourth quarter 2007, according to a new report from Click Forensics, Inc. That's up from the 14.2% click fraud rate for the same quarter in 2006 and 16.2 percent for third quarter 2007.

Austin, Tex.-based Click Forensics, Inc. on Thursday released industry pay-per-click (PPC) fraud figures from the search advertising industry's leading independent click fraud reporting service--the Click Fraud Index (www.ClickFraudIndex.com), which monitors and reports on data gathered from more than 4,000 online advertisers and agencies.

Other key findings include:

• The average click fraud rate of PPC advertisements appearing on search engine content networks, including Google AdSense and the Yahoo Publisher Network, was 28.3% in the fourth quarter. That's up from the 19.2% average click fraud rate for the same quarter in 2006, and 28.1 percent for third-quarter 2007.
• The 2007 industry average click fraud rate grew by 15% over the industry average click fraud rate for 2006.
• Fourth-quarter 2007 click fraud traffic from botnets was 15% higher than click fraud traffic from botnets in third-quarter 2007.
• In fourth-quarter 2007, the greatest percentage of click fraud originating from countries outside North America came from India (4.3%) Germany (3.9%) and South Korea (3.7%).

"In 2007 we saw a significant jump in the industry average click fraud rate when compared with the average rate for 2006," said Tom Cuthbert, president and CEO of Click Forensics, in a statement. "As the FBI and USAToday have reported, fraudsters are using more sophisticated means to perpetrate click fraud, including infiltrating mom-and-pop e-commerce sites. As a result, it's more important than ever before for advertisers, publishers, ad networks and search engines to cooperate and share data in order to stem what's on target to be an even worse problem in 2008."