Click Fraud Rears Its Ugly Head
What should PPC vendors do about click fraud? Take it seriously.
What should PPC vendors do about click fraud? Take it seriously.
Click fraud has been back in the news these last few weeks. As well it should be. Click fraud is the single biggest threat to search, and by extension all online, advertising, at the moment.
Wait: did I say click fraud was the biggest threat? I’m sorry. I meant the perception of click fraud is the biggest threat. The actual size of the click fraud market is unknowable. It may be minute, as Eric Schmidt says it is. It may be massive, as companies selling services that claim to ferret out click fraud in your campaign say. It may be somewhere in between. Or massive during the holidays, gone in January.
What’s very easy to measure, however, is how advertisers feel about click fraud, and they don’t feel good. JupiterKagan’s search analyst was recently quoted as saying Google decided to make its systems that measure click fraud more transparent in an effort to ensure “Google and click fraud are not synonymous.”
Talk about a threat to the brand. Let’s not pick on Google, but rather extend the concept to every company built on a PPC (define) service. If PPC becomes synonymous with click fraud, regardless of the statement’s verifiable reality, advertiser confidence will drop like a stone. With that gone, there goes investment, too. If confidence is gone, protestations that click fraud is really not a problem will fall on deaf ears. Those ears will have gone on to other advertising methods.
Is Click Fraud Really a Problem?
Arguments have been made that click fraud is really not a problem at all. As stated earlier, Schmidt has said the number of fraudulent clicks is tiny. I’ve spoken with people at the big affiliate networks, such as Commission Junction and Performics, who assure me click fraud is a good problem to have because it’s extremely easy to detect. Some economists have even argued click fraud makes no real difference because the market will naturally correct itself: the number of fraudulent or worthless clicks will dilute the overall efficacy of a program and advertisers will respond by lowering their bids. Finally, every company (of repute) has a policy in place; if you can demonstrate fraud, you don’t have to pay. A click incurs only a fractional cost for the search engine or affiliate network, so there isn’t a huge loss in simply removing it from the books.
All good arguments. Unfortunately, none really hold up, simply because click fraud isn’t a bunch of interacting systems. It’s a bunch of interacting humans, and human behavior has a nasty way of throwing off even the most perfectly designed system. Let’s examine each argument:
The Click Fraud Solution
What should PPC vendors do about click fraud? Simple: take it seriously. If the threat of click fraud lies primarily in its perception in the marketplace, vendors must be up to the task. Freeing up information so operators have a better chance of finding problems is good, as is putting together specific teams to not only police the network but also talk with customers. Vendors should learn from craigslist and eBay and put a “flag” button on their management interfaces, letting customers click their way to alleviating (or at least airing) concerns.
If search and online advertising are built on the belief we can recapture that mythical “half of advertising is wasted,” we certainly can’t sit by and watch some portion of that fall to fraud.
Meet Gary at Search Engine Strategies in San Jose, August 7-10, 2006, at the San Jose McEnery Convention Center.
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