What is Click Fraud?
Definition: Clicks for any other reason than to visit the advertiser’s website.
How does it happen? What tactics are being used?
1. Manual clicking. Usually from a competitor trying to exhaust the budget.
2. Automated clickbots.
3. Email distribution.
4. Spyware: Placing ads into Spyware programs that automatically click on ads, and result in a charge to the advertiser.
5. Search engine syndication affiliates attempting to generate more commissions for themselves.
Click Fraud Management Methods:
Search Engine Auditing: Search engines have their own proprietary systems to track & measure data. If fraudulent clicks are identified, a refund is made in the form of advertising credits, not an actual refund of dollars. 2nd tier SE’s tend to have a higher amount of invalid click activity. This can be attributed to either not robust enough click monitoring activity or to an increased dependency by their network partners and not policing themselves more aggressively. The SE’s have stated that they can’t fully audit all clicks for potentially fraudulent click activity.
Web Analytics: It is possible to identify Using web analytics to monitor key metrics such as: recurring IP addresses, Referrers, # of Pages Viewed per visit, Date & Time, volume & timing of incoming traffic, conversion rates ( eg: bots filling in forms spike CR’s), time on site, and click cadence.
Risk Factors:
The percentage of fraud depends on Advertisers and their individual campaigns. Risk Factors include: Geographic location, length of keyword phrase, CPC, high competition within a specific category.
The accepted industry average for click fraud is 13.7% which has been extrapolated across multiple industry categories (Source: Click Forensics). However, it is important to note that 13% of clicks does not equate to 13% of spend. Most advertisers use a higher % of spend on a small % of the keywords.
Strategies to minimize click fraud:
1. Monitor highly competitive terms & categories which could be at a higher risk.
2. Monitor smaller 2nd tier engines.
3. Review regularly scheduled web analytic reports.
4. Increase SEO efforts to reduce dependency on PPC.
Advertiser vs. Publisher Search Engine Agreements: Contract terms between Advertisers and the Search Engine network partners are worded differently. The SE contracts state that advertisers are responsible for “All” clicks. Interestingly, the SE contract with the publisher’s state that they will only be paid for “valid” clicks.
Agency perspective:
Since the Search Engines can’t see data across multiple engines and syndication partners, the agencies should not rely on the audited data provided solely by the SE’s to manage click fraud. The agency needs to monitor & gather data for clients, and work with SE’s to resolve any disputed click activity. Agencies need to take a holistic view at multiple click fraud solutions.
Dispute Resolution:
The Agency should be actively engaged in managing click fraud, and will handle any dispute resolution involving the search engines. The agency needs to resolve the dispute quickly, and ensure that it does not interfere with the client’s campaign objectives. When backend technology is made available, the agency should schedule regular web analytic reports, and review it with the Search Engines if and when necessary.