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E-Commerce Firm Accuses Facebook of Click Fraud

  |  July 31, 2012   |  Comments

E-commerce store hosting firm alleges 80% Facebook ad clicks from bots.

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A small hosted e-commerce store company says it is giving up on Facebook because a large majority of ad clicks are coming from bots and the popular social network is now allegedly holding their page name hostage. Their accusations, posted yesterday to their Facebook Page, set off a firestorm in the technology sphere.

E-commerce store builders Limited Pressing alleges that Facebook is holding the name they want for their Page hostage. The post reads:

While we were testing Facebook ads, we were also trying to get Facebook to let us change our name, because we're not Limited Pressing anymore. We contacted them on many occasions about this. Finally, we got a call from someone at Facebook. They said they would allow us to change our name. NICE! But only if we agreed to spend $2000 or more in advertising a month. That's correct. Facebook was holding our name hostage.

“We're currently investigating their claims," a Facebook spokesperson told Search Engine Watch. "For their issue with the Page name change, there seems to be some sort of miscommunication. We do not charge Pages to have their names changed. Our team is reaching out about this now.”

The spokesperson explains, “For Page name change requests, we ask that many requests be routed through our team to prevent confusion from users. For example, we don't want people finding that a Page they liked changed its name to something completely unrelated to the original Page name.”

A cursory search shows that the Page name Limited Pressing is seeking, Limited Run, is already taken and has been occupied and active by a running magazine since October 25, 2010. Miscommunication, indeed. Even for a fee, the Page name is not available.

As there is no audio recording of the telephone call said to have transpired, we will never really know what might have been said between a Facebook employee and the Limited Pressing representative.

Limited Pressing Alleges 80% of Ad Clicks Are Bots

Limited Pressing claims to have determined over a one-month testing period that 80 percent of their Facebook ad clicks were performed by bots. While their initial announcement hedges around actually accusing Facebook of running the bots, the message is clear: Facebook’s ad platform has a big click fraud problem.

In its post, Limited Pressing wrote, “...we tried contacting Facebook about this. Unfortunately, they wouldn't reply. Do we know who the bots belong too? No. Are we accusing Facebook of using bots to drive up advertising revenue. No. Is it strange? Yes. But let's move on, because who the bots belong to isn't provable.”

In describing the problem and how they identified the traffic as bots, Limited Pressing wrote:

A couple months ago, when we were preparing to launch the new Limited Run, we started to experiment with Facebook ads. Unfortunately, while testing their ad system, we noticed some very strange things. Facebook was charging us for clicks, yet we could only verify about 20% of them actually showing up on our site.

At first, we thought it was our analytics service. We tried signing up for a handful of other big name companies, and still, we couldn't verify more than 15-20% of clicks. So we did what any good developers would do. We built our own analytic software. Here's what we found: on about 80% of the clicks Facebook was charging us for, JavaScript wasn't on. And if the person clicking the ad doesn't have JavaScript, it's very difficult for an analytics service to verify the click. What's important here is that in all of our years of experience, only about 1-2% of people coming to us have JavaScript disabled, not 80% like these clicks coming from Facebook.

So we did what any good developers would do. We built a page logger. Any time a page was loaded, we'd keep track of it. You know what we found? The 80% of clicks we were paying for were from bots. That's correct. Bots were loading pages and driving up our advertising costs.

Facebook Reiterates Click Fraud Policies

Search Engine Watch asked Tom Mango from Limited Pressing to share data or evidence from their month-long period of testing to verify their findings, but nothing is available at this point.

“I don't have any additional details right now," Mango said. "We do plan to post more about how we came to this conclusion, but honestly, we had no idea anyone outside of our followers would know or care about this whole thing, so we were really caught off guard.”

Facebook said that since people can only see ads when logged into Facebook, it would be difficult for someone to create a series of fake accounts to click on ads.

“If we find fake accounts, we disable them immediately,” a spokesperson said.

Facebook has systems in place that attempt to detect and filter certain click activity, including repetitive clicks from a single user, clicks that appear to be from an automated program or bot, or clicks that are otherwise abusive, their spokesperson said.

“Our systems also look at whether Javascript is enabled in the browser. According to our recent data, nearly all billable clicks resulting from desktop web browsers have JavaScript enabled,” they added.

In its Q2 2012 Earnings call, Facebook answered a caller question about click fraud. The Facebook representative said they are continually making efforts to reduce fraudulent activity and fake accounts by becoming better at detecting duplicate accounts. They also shared the information that more offenders come from Turkey and Indonesia than any other countries.

On a macro level, Facebook now has independent ROI data from more than 60 advertising campaigns using a variety of third-party methodologies like panels and marketing mix models. The results show that 70 percent of campaigns resulted in a return on ad spend of 3x or better, and 49 percent of campaigns showed a return on ad spend of 5x or better.

sheryl-sandbergFacebook COO Sheryl Sandberg told investors on the earnings call, “Advertising on Facebook is complicated and that's mainly because we're a completely new type of marketing. The messages that talk ‘at’ consumers in other mediums like TV or search need to be fine tuned for our platform.”

"Also, attribution is an issue." Sandberg noted. "Marketers need to tie sales back to multiple touches; they may see on Facebook and search later. Our ads work and the ROI is there, so we're focusing on education.”

To that end, Facebook has an extensive Ads Help Center accessible from the ads building platform. They also offer individual case studies highlighting the successes of small businesses, which marketers can use to replicate good results.

This article was originally published on Search Engine Watch.

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