Click Fraud: Defining the Context of a Problem (Part 1)

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October 12, Issue #140


Clíck Fraud: Defining the
Context of a Problem (Part 1)
By Jim Hedger (c) 2006

Everyone involved in search marketing considers Clíck Fraud a problem issue though to what degree problems exist depends on who is looking at the issues. Pay-Per-Clíck (PPC) search advertising is the golden goose that makes the major engines financially viable but the success of the PPC model, mixed with the nature of the 'net can make PPC advertising a double-edged sword for advertisers.

This is the first piece in an ongoing series on Clíck Fraud we will be running in SiteProNews and SEO-News. Many in the search marketing and search advertising industries would prefer the issue be avoided altogether. Paid search advertising has grown to become a rapidly expanding multi-billion dollar industry, much of it based on the success of PPC.

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Editorial Note: Drop by the SiteProNews Blog to read regular posts by two of the Web's top SEO writers, Jim Hedger and Kim Roach.

According to a recent study, "US Online Advertising Forecast, 2005 to 2011", by JupiterResearch, $6.5-billion will be spent on search advertising in 2006, a figure that is projected to jump to $11-billion over the next five years. Clíck Fraud, which is estimated to range from 5% - 15% of PPC traffíc (some estimates are as high as 20% - 35%) could therefore be a factor in $350-million to $975-million worth of clíck-transactions. There is a lot of monëy involved in PPC and the tremendous weíght of financial interest lurks somewhere behind virtually any discussion of the issue, especially a discussion about Clíck Fraud.

The share values of giants such as Google, and to a lesser degree, Yahoo!, Time Warner, AOL, IAC and MSN rely on advertiser confidence in paid search advertising. A massive amount of search marketing sp@m is created to generate high PPC payouts, which are shared between the search engines and web publishers. There are a number of legítimate SEM agencies turning a tidy profít by charging a percentage of the monthly or annual ad-spend of their clients. With so much monëy at stake, it's little wonder the biggest players in the search engine and search marketing industries would want to keep the issue under wraps.

This series is going to explore issues associated with Clíck Fraud from several angles, starting with an attempt to define the issue from a few different points of view. In subsequent articles we will focus on motives and opportunities, technologies and techniques, detection and deception, and alternative search based advertising methods outside the realm of PPC. We expect to touch on a number of other points, many of which will overlap from article to article, during the development of the series.

A good place to start would be an attempt at defining what, exactly, constitutes Clíck Fraud. In this case, the breadth of the beast is measured in the eye of the beholder.

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The Wikipedia offers the best definition saying, "Clíck fraud occurs in pay per clíck online advertising when a person, automated scrípt, or computer program imitates a legítimate user of a web browser clicking on an ad, for the purpose of generating an improper charge per clíck. Clíck fraud is the subject of some controversy and increasing litigation due to the advertising networks being a key beneficiary of the fraud whether they like it or not."

Of the search engines themselves, Google provides the simplest, most direct definition. Yahoo! offers a 13-point FAQ that fails to actually provide an exact definition. MSN and Ask also provide fairly good descriptions of the issue and remedies for advertisers. None of the major PPC providers offer advertisers an indication of how complicated clíck fraud analysis can be.

Google's Definition
Google doesn't like to use the term Clíck Fraud, preferring a phrase that conveys far fewer implications, "invalid clicks".

According to the Google AdWords Learning Center, "Invalid clicks are clicks generated by prohibited methods. Examples of invalid clicks may include repeated manual clicking or the use of robots, automated clicking tools, or other deceptive software. Invalid clicks are sometimes intended to artificially and/or maliciously drive up an advertiser's clicks and or a publisher's earnings."

Google provides instruction on how to deal with and report suspicions of clíck fraud and outlines how to initiate an investigation.

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Yahoo!'s Definition
Yahoo! doesn't mind using the phrase Clíck Fraud. A prominent text-link on the front page of the Yahoo! Search Marketing site leads to the Y!SM Clíck Fraud FAQ page.

On it, Yahoo! says, "Clíck fraud is generally considered to be clicks made with bad faith with the sole purpose of generating a charge to the advertiser with zero possibility of a legítimate site visit or transaction occurring. We agree." No clear definition of Clíck Fraud is provided, aside from Yahoo!'s agreement with a general statement describing it. Apparently, defining clíck fraud is complicated.

The FAQ suggests it is difficult to judge the purpose of clicks through its network because it is technically impossible to read people's minds. (Ed. note: We agree.) Instead, it is forced to fall back on analysing clíck behaviour, spotting identifiable patterns in clíck traffíc, trying to define the faith of each clíck. Yahoo!'s FAQ continues, saying, "In terms of identifiable behavior, we define clíck fraud as detected illegitimate bots and certain repetitive clicks."

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The next paragraph on the FAQ page should be of concern to advertisers. It introduces the phrase, "Traffíc Quality Clicks", a phrase describing all clicks that are not generated by (identifiable) clíck fraud. This includes, "... clicks from domestic and international users and clicks from our various distribution channels and products." A small but scary number of Yahoo!'s distribution channels and products have been linked to malware, spyware and clíck-bot networks, as a coming article in this series will examine. Come to think of it, someone at Yahoo! needs to take a look at that FAQ page immediately, we're going to and we thing Y!SM marketers should as well.

Microsoft's Definition
MSN, which broke into the PPC market later than its rivals did, shares Google's aversion to the phrase "Clíck Fraud", agreeing to refer to the problem of "Invalid Clicks". An FAQ entry offers a short and direct definition of what they consider an Invalid Clíck saying, "An invalid clíck is a type of non-billable clíck resulting from user error, malicious activity or other factors potentially indicative of fraudulent activity."

In a subsequent statement, MSN acknowledges invalid clíck activity will occur saying, "Any unexplained changes in clíck activity should be reviewed for validity." The FAQ section goes on to explain how to monitor and appeal clíck charges.

Ask's Definition
Ask's new Sponsored Listing PPC considers Clíck Fraud to be an industry problem. Ask's Traffíc Quality page opens with the headline, "We protect you against clíck fraud."

Ask suggests, "Valid clicks are clicks on a listing that are generated by humans, whose intent we judge to be to engage the advertiser's site (such as to make a purchase, register for services, or navigate content.). Invalid clicks are clicks generated by robots, systems or software whose intent we judge not to be to engage the advertiser's site."

The rest of the page goes into great detail describing how Ask identifies invalid clíck behavior, mentioning several factors it uses to assess the validity of each clíck.

Industry Analysts
In a March 26, 2006 iMediaConnection article analyzing Google's settlement of a major clíck fraud case called Lane's Gifts v. Google, Clickfacts cofounder, Michael Caruso provides a well rounded description,

"With pay-per-clíck ads that show up next to search results, the more times an ad is clicked, the more the advertiser pays. With contextual ads, where ads are placed on third-party websites, pay-per-clíck ad revenue is split between the publisher and the search company, such as Google.

Sometimes publishers clíck their own sites to get more revenue from the search engines. Webmasters sometimes form partnerships to clíck on each other's advertisements. Sometimes people clíck on their competition's ads, just to drive up their costs. CNET reported, "...the chief executive of an internet marketing company, enjoys clicking on his rivals' text ads ... his competitor must pay as much as $15 each time." There is also bot-like software all over the internet through anonymous "proxy" servers scattered in far-flung locales, creating the illusion that visitors are logging on from all over the place, masking the traffíc's true origin.

Then there are even software companies with names like Fakezilla that sell traffíc simulators online intended to make sites appear popular and thus boost ranking on search engine pages. They are also used for clíck fraud."

Six definitive acknowledgements of invalid clíck activity later, we can all agree that clíck fraud is a very complicated and very real problem. Stay tuned as we explore it.


About The Author
Search marketing expert Jim Hedger is one of the most prolific writers in the search sector with articles appearing in numerous search related websites and newsletters, including SiteProNews, Search Engine Journal, ISEDB.com, and Search Engine Guide.

He is currently Senior Editor for the Jayde Online news sources SEO-News and SiteProNews. You can also find additional tips and news on webmaster and SEO topics by Jim at the SiteProNews blog.


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