Click Fraud: Who’s Stealing My Paid Search Budget?

At first it was just noise. A few reports surfaced that people were maliciously clicking on paid search results with no intention to buy anything. The first reports talked about what some call “drive by” click fraud—jealous competitors that click on your ad just to drain your paid search budget.

Then the automated click fraud began. Clever programmers devised programs to simulate clicks on the ads. Who would want to do this? The very syndicators that share the ad revenue with Overture and Google. Now, understand, most syndicators are absolutely honest, but some are not. And they get a cut of every per-click fee, so they have heavy incentive to perpetrate fraud if they are not the most ethical folks around.

Search engines try to ferret out the fraud. When they find something suspicious, they refund the money of the advertiser for each suspicious click. So far, search engines think they are staying ahead of the defrauders. They check for click patterns that are not natural, such as too many clicks from particular syndicators. Or clicks that immediately abandon the site. Or clicks coming from the same IP addresses over and over. And far more elaborate patterns.

So the click fraud crowds upped the ante in this game of high stakes poker. They began “sweat shop click fraud”—hiring scores of lowly-paid workers in China, India, and other countries to click on these ads in a naturally human way, that might not exhibit the automated patterns. They used PC Anywhere and other remote access programs to hide the geographic locations of the IP addresses. They had their click brigades simulate clicking on real ads and browsing around the site, reading each page. But, darn, each one somehow abandons before buying—fancy that!

It’s a lot harder for search engines to spot this kind of fraud. And suppose those human click patterns could be captured by a business intelligence programs into a pattern that could then be automated? Couldn’t the spammers then simulate clicks that were almost indistinguishable from real people? Maybe this is already happening. The latest reports say that click fraud accounts for as many as 20% of all paid search clicks.

Although click fraud is gaining steam, the war is not over. The search engines are fighting back in the war on click fraud and so can you.

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