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Now Publishers are "recycled ads" outlets
Businessweek puts slam on AdSense publishers
ronburk




msg:3093497
 9:17 pm on Sep 22, 2006 (gmt 0)

In the new Businessweek article [businessweek.com] on click fraud, the article consistently and repeatedly refers to the content network as an outlet for "recycled ads" that search engines use to "boost" their profits. The word "recycled" is used 5 times in this article to refer to content network ads.

Wow, talk about beating the drum of lousy PR for AdSense publishers! The article really makes us sound like the dregs of the advertising world, and makes the SEs sound downright sleazy just for putting ads on our websites (quite apart from the issue of click fraud).

The quotes from Google reps continue their strategy of yelling "no problems!" while humming loudly and putting their fingers in their ears. But the article cites an example of a big AdWords buyer who repeatedly told Google that a particular AdSense publisher was delivering invalid clicks. Google denied and minimized, and then essentially said "uh, yeah, guess something's going on there we weren't detecting."

Geez, what a PR disaster this article is for AdSense. Google better get on top of the perception that AdSense is a giant rip-off for advertisers real quick, because the AdSense image is on a real downhill slide now.

 

DamonHD




msg:3095743
 10:34 am on Sep 25, 2006 (gmt 0)

I wish...

(Except that I have a pro-bono site with free materials, so I wouldn't have "free" and "cheap" in my exclusions list for example to allow people to come from similar sites.)

Still, I added a few of those on the AW side: thanks.

Rgds

Damon

[edited by: DamonHD at 10:35 am (utc) on Sep. 25, 2006]

gregbo




msg:3096634
 10:14 pm on Sep 25, 2006 (gmt 0)

And with the technical know how at there disposal and the profits at stake, its not a huge stretch to assume G and the other networks will find reliable methods to detect and prevent CF.

You should read the Tuzhilin report (and reread it if you have already). Click fraud is about intent, which is not communicated via the Internet protocols (and won't be). As long as the preferred advertising methods are CPC and CPM, click fraud will continue to be at least as much of a problem as it currently is, because they are the most vulnerable.

gregbo




msg:3096644
 10:23 pm on Sep 25, 2006 (gmt 0)

this part of article says I told Yahoo years ago.YPN is just 1 year old.not so?

Possibly this refers to other ad serving companies that Yahoo has contracted with in the past.

darkmage




msg:3096825
 1:01 am on Sep 26, 2006 (gmt 0)

Look, click fraud is not good for any of us. But here are a few things to look at:
ROI: The main guy was complaining about had been using adsense for 3 years and spent 2 million dollars. He must be getting some kind of decent return to stick with it -even with the supposed $100,000 click fraud.

EFV Said
'A lot of businesspeople (and non-journalists in general) are ignorant about journalism. For example, there was a complaint earlier in this thread that the BUSINESS WEEK story wasn't "balanced," as if that were a sin.'
I said the article was unbalanced and it is on many different levels - before making this kind of statement EFV did you consider that some people on this thread may have significant experience in journalism and actually know what they are discussing - hint, hint.

OK, here is another problem with the Business Week article. I understand how Adsense/Adwords operates. After reading the article, I don't think the writer had much of a clue. There is lots of fluff and sensationalist garbage in it. So, how much will I value Business Week's view on something that I don't know about? Zip.

Clickfraud is an important newsworthy topic that could be handled much better - let's not assume that an important topic automatically implies that all things written about it are worthy of publication. I think these two distinctions were somewhat muddled up in this thread.

Andreals




msg:3096846
 1:25 am on Sep 26, 2006 (gmt 0)

Clickfraud is an important newsworthy topic that could be handled much better...

To someone who works with something as complex as AdSense full time I suspect any journalist's work is going to appear clueless if they have been assigned to the story for a few weeks.

It's important to remember this when reading any news report on an industry you're not familiar with--the research there may well be just as botched as BW's.

I strongly suspect (this is my opinion) that there is a lot of resentment towards Google by publications like BW because their very existence is threatend if PPC succeeds. So BW will naturally err on the side of making Google and AdSense look bad. I'll give them the benefit of the doubt and say that their animosity sub-consciously clouds their judgement.

KenB




msg:3096856
 1:31 am on Sep 26, 2006 (gmt 0)

ROI: The main guy was complaining about had been using AdSense for 3 years and spent 2 million dollars. He must be getting some kind of decent return to stick with it -even with the supposed $100,000 click fraud.

ROI always seems to be the ignored part of the equation. One should never big higher for key phrases than a healthy ROI will support. If click fraud is a problem advertisers should be bidding lower to keep their ROI in balance. Given how easy it can be to measure ROI with a CPC campaign it is foolish not to do it.

Who really comes out the loser with click fraud is honest content sites. Click fraud deflates the value of clicks by the means described above with ROI and by driving away advertisers. Advertisers can take their money elsewhere if click fraud is making CPC advertising a bad investment. Honest content sites really can't replace advertisers who flee online advertising because of fraud.

ronburk




msg:3097875
 5:40 pm on Sep 26, 2006 (gmt 0)

He must be getting some kind of decent return to stick with it -even with the supposed $100,000 click fraud.

Interesting that one of the well-read blogs that linked to the BW story made that very point -- by saying that advertisers are getting tired of it and are starting to realize they have a right to get what they paid for.

Kinda like thinking shoplifting isn't really bad because the stores still make lots of money, and if they really didn't want shoplifters they could just make everybody stand at the front of the store and have clerks go fetch the goods for them.

And periously close to "I didn't steal your mule -- and it's not a very good mule anyway!" :-)

jay5r




msg:3097941
 6:42 pm on Sep 26, 2006 (gmt 0)

There was an article on Marketplace [marketplace.publicradio.org] yesterday that stated that 37% of traditional advertising is wasted, in part because advertisers weren't very good at calculating the ROI for their ads. IMHO, even with click fraud, web-based ads can be more effective because they're tailor made for ROI calculations - at least you can factor the click fraud into your ROI and stop or adjust things before you lose much money.

That doesn't mean Google can let up on fighting click fraud, but it does mean that a small amount may be acceptable to advertisers because their accustomed to some "waste" in their advertising budget.

The Wall Street Journal did an article [startupjournal.com] last year on the same topic. As you might imagine, it was a bit more level-headed than the BusinessWeek article. While they said that some people think click fraud can represent as much as 20% of the clicks, the concrete examples they gave were lower than that - in one case as low as 2%.

KenB




msg:3098040
 7:21 pm on Sep 26, 2006 (gmt 0)

Kinda like thinking shoplifting isn't really bad because the stores still make lots of money, and if they really didn't want shoplifters they could just make everybody stand at the front of the store and have clerks go fetch the goods for them.

I don't think any of us are saying click fraud isn't bad, I know I'm not, I'm just saying it can be managed by monitoring ROI. In your store anology the store keeper raises their prices to cover the loss caused by shoplifting. In the same fashion an advertiser needs to lower their bid prices to manage their ROI.

Click fraud is BAD and everyone needs to do their part to help reduce it as much as possible. This means ad brokers like Google and Yahoo need to be more transparent and provide advertisers with more ability to exclude certain types of sites they don't want to advertise on (e.g. parked domains). They also need to inform advertisers where their clicks are coming from. In fact Google and Yahoo telling advertisers the URL of pages resulting in clicks might be the most cost effective means to fight click fraud as it would be easier for advertisers to root out bad websites.

gregbo




msg:3098361
 11:32 pm on Sep 26, 2006 (gmt 0)

I don't think any of us are saying click fraud isn't bad, I know I'm not, I'm just saying it can be managed by monitoring ROI. In your store anology the store keeper raises their prices to cover the loss caused by shoplifting. In the same fashion an advertiser needs to lower their bid prices to manage their ROI.

Arguably, this article could have been "Search Engines Can Yield Poor ROI due to Nonconverting Clicks" and it would have been just as damning. The long and short of it is SEs/ad networks don't want advertisers to feel that they should reduce their spend.

moTi




msg:3098483
 2:27 am on Sep 27, 2006 (gmt 0)

advertisers have the right to get to know the most appropriate estimation of click efficiency - but that's it.
no earnings guarantees included in this game, this must be clear for everyone.

dibbern2




msg:3098517
 3:15 am on Sep 27, 2006 (gmt 0)

We're blowing this up into much more than it really is. Its not a PR disaster, and its certainly not damning. This week's Businessweek is nothing more than next week's wrapping for the leftover fish and other table scraps. In the span of a year, a tiny little blip.

Shoplifting, credit card fraud, counterfeit money... and now click fraud: while morally and socially evil, in a business sense, are just another --rather minor-- cost. It won't make anybody change anything.

Andreals




msg:3098545
 4:07 am on Sep 27, 2006 (gmt 0)

If AdSense is really as fraud-ridden as BW says it deserves to die and will.

On the other hand, while click-fraud will always be a problem just like shoplifting and resumé fraud, it is BW's business model that is more greatly flawed and will eventually die. RIP

DamonHD




msg:3098722
 8:42 am on Sep 27, 2006 (gmt 0)

Hi Andreals,

Yes, I think you have it there.

If in passing they indicate that they regard "recycling" as an evil thing too, then they are very very out of touch with the world.

RIP.

Rgds

Damon

ronburk




msg:3099174
 3:51 pm on Sep 27, 2006 (gmt 0)

no earnings guarantees included in this game, this must be clear for everyone.

No, but the difference is advertisers purchase a specific service from Google, and the contract does not cover "shrinkage".

Look, if I buy a full-page ad in Newsweek, there's no way I can get my money back if the ad gives me a crappy ROI; like you say "clear for everyone". But what do you think happens if the printer screws up and 15% of the issues do not contain my ad at all? Well, I darn sure get some money back because my advertising contract with Newsweek did not claim that they regularly screw up and fail to get my ad onto a significant number of issues.

If Google wants to change their contract with advertisers to specify that up to, say, 20% of clicks may be fraudulent, then advertisers will have no excuse -- take the fraud or leave it. But when Google tells me I'm buying good clicks and then delivers fraud, that is their fault and it's actionable. It is actionable precisely because my contract with Google does not say a significant portion of clicks will be fraud, just like my contract with Newsweek does not say they'll fail to put my ad on a significant number of copies of the magazine.

Google makes their money being the middleman on clicks, so they have to take responsibility for the clicks (again, they can just confess and make me agree that a percentage of them will be fraud if they want to avoid that responsibility). You can bet Google holds advertisers and publishers to their end of the contract when it affects Google's bottom line, and it's nuts to think that advertisers should just be happy they're getting a functional ROI rather than holding Google to their end of the contract when it affects the advertiser's bottom line.

This is where Google is between a rock and a hard place. They do not want to admit that fraud exists to the degree it probably does, and they also do not want a whole bunch of advertisers asking for a 5-20% refund every month. That's a problem that ain't going away. Google cannot have it both ways.

darkmage




msg:3099234
 4:33 pm on Sep 27, 2006 (gmt 0)

Ronburk said 'But what do you think happens if the printer screws up and 15% of the issues do not contain my ad at all? Well, I darn sure get some money back because my advertising contract with Newsweek did not claim that they regularly screw up and fail to get my ad onto a significant number of issues.'

While the refund may happen, it is often for a different reason to what you imply. Most contracts actually specify that the publisher is not responsible for shortages, damages etc. However, most publishers will give a credit/refund in extreme cicumstances because they like to retain advertisers and their reputations as publishers. I have seen this process in action (both refunds and no-refunds). Not only that, but there are situations where an insert is subject to margin variations and the advertisers actually has to print more copies of an insert than the total print run in the mag - this allows for last minute changes to the mag print run and damages. Typically this is 5-10% - all bourne by the advertiser. In newsweek's case, the margin of error for an insert is 5%.

Now to Google's Adwords contract 'Customer understands that third parties may generate impressions or clicks on Customer's ads for prohibited or improper purposes, and Customer accepts the risk of any such impressions and clicks.' So I think that covers what you are suggesting. It goes on to say you an claim for click fraud - at Google's discretion.

Finally, the assumption of 15% damage implies that this is the level of click fraud. I don't think anyone really knows the level, but as an Adwords advertiser I think 15% is very much on the high side. But what if click fraud - or the damage rate is only 1% or 0.1%. Would anyone take the time needed to get this back. If an ad budget is $5000, you are talking about $5-50. Besides, the fraud rate is bound to move around. As long as it remains relatively low, your efforts are better off elsewhere.

bbd2000




msg:3099304
 5:27 pm on Sep 27, 2006 (gmt 0)

Prospective:

1.Google is competing with BW for ad dollars.
2.Content websites are competing with BW for readers.

BW is being challenged any way you look at it. No wonder they lashed out.

BTW, I used to be a magazine junkie. I would buy 3-4 magazines a week. I don’t think I have bought a 3-4 magazines in the last year. The web, with all its problems, allows me to find the information I am interested in, whenever and wherever I want. Magazines could never match that.

incrediBILL




msg:3099359
 5:55 pm on Sep 27, 2006 (gmt 0)


OK boys and girls, am I the only one that noticed the sour grapes motivation in the BusinessWEAK article?

Google and Yahoo are grabbing billions of dollars once collected by traditional print and broadcast outlets

It's the same reason all traditional publications want AdSense gone, and will do nothing but continue to say bad things, because AdSense is a power shift transitioning large marketing budgets away from the good old boys club.

The advertising landscape is being transformed with revenue shifting from many big media moguls to lots of small individual publishers that couldn't have afforded to even be in this business 5 years ago.

Yup, they're scared and want us gone.

Don't give in to the hype and just keep fighting the good fight as we won't be stopped now, we've come too far to let such nonsense end our turn at the trough.

Hobbs




msg:3099387
 6:21 pm on Sep 27, 2006 (gmt 0)

When you get a dog,
the fleas come included.

mattg3




msg:3099458
 7:02 pm on Sep 27, 2006 (gmt 0)

Most offline ads are view fraud. No one knows how they perform.

But we will get many more articles like that. Some of them will be of the well informed "Game convinces youngster to go postal" kind.

trinorthlighting




msg:3099478
 7:23 pm on Sep 27, 2006 (gmt 0)

Interesting topic,

My thoughts are if you plan any type of advertising there are risks to it. Before you shell out the money you better research and understand the risks.

A lot of adwords users get really frustrated all of those clicks do not neccessarily convert and that is the real issue.

Reasons why they do not convert:

1. User finds the site is not easy to navigate.
2. Targeted adword does not take them to the proper landing page. (I see this a lot, person advertises pink widgets and directs them to their homepage instead of the pink widget page which is 4 clicks away)
3. Pricing.... Face it people look online to find the best deal. If your competitor is advertising the same product at a lower price, kiss the sale goodbye.
4. User is looking for a more local supplier.
5. Adword description does not match product.
6. Adword purchased is broad. (Example: Adword: Television; the adword takes you to a site that repairs televisions. User is looking to purchase a television)
8. Site loads slow or is down a lot.
9. Shipping costs, I see a lot of sites that advertise real low prices but inflate their shipping costs. Most average users know what to expect in shipping costs.
10. Last but not least, sites have too few technical details or photos. Face it, when it comes to a real technical product customers need to find manuals and like to see products in action.

ronburk




msg:3099651
 9:40 pm on Sep 27, 2006 (gmt 0)

Most contracts actually specify that the publisher is not responsible for shortages, damages etc.

Well, if you want to really talk about the real world, serious advertisers do not advertise in magazines that have not been audited by an independent auditor, such as the BPA. In turn, any serious magazine will pay for such an independent audit on a regular basis because they know failing to do so cuts them off from a large number of advertising dollars.

What's the point of the audit? So the advertiser can judge whether they are buying what the magazine claims to be selling. A magazine that the auditor says has 95% paid subscribers tends to be more valuable than one in which the publisher has to give away most of the copies.

Google provides advertisers no data on the degree of fraud expected, and offers no third-party auditor information to help advertisers judge whether they are buying what Google claims it is selling. That's completely different than the magazine advertising world.

gregbo




msg:3099826
 12:38 am on Sep 28, 2006 (gmt 0)

Finally, the assumption of 15% damage implies that this is the level of click fraud. I don't think anyone really knows the level, but as an Adwords advertiser I think 15% is very much on the high side. But what if click fraud - or the damage rate is only 1% or 0.1%. Would anyone take the time needed to get this back. If an ad budget is $5000, you are talking about $5-50. Besides, the fraud rate is bound to move around. As long as it remains relatively low, your efforts are better off elsewhere.

The overall amount of click fraud might be 1%, but that doesn't mean individual accounts can't get whacked at a much higher rate. That's one reason why advertisers' concerns are justified. This was in Tuzhilin's report, btw.

This reminds me of someone I know who was just nailed by credit card fraud. The overall amount of it isn't high enough to warrant publication in business journals, but when it happens to you ...

gregbo




msg:3099833
 12:48 am on Sep 28, 2006 (gmt 0)

This is where Google is between a rock and a hard place. They do not want to admit that fraud exists to the degree it probably does, and they also do not want a whole bunch of advertisers asking for a 5-20% refund every month. That's a problem that ain't going away. Google cannot have it both ways.

I think it would be in G's interest to publicly admit that they don't really know how much click fraud there is, or how much they're actually able to detect. (They can certainly claim how much of what they call "invalid clicks" they actually detect, which may not be the actual amount of click fraud.) The more that "old" media pumps this issue (biased or not), the more G will be pressured to come up with a solution (or a reason why they can't).

jessejump




msg:3104438
 5:13 pm on Oct 1, 2006 (gmt 0)

Maybe I missed it - is anyone going to write a letter to Business Week concerning this article?
Maybe they will publish it.

>>>>>is BW's business model that is more greatly flawed and will eventually die. RIP

Great. BW dies and what takes its place? 500 parked domains.

Andreals




msg:3104463
 6:12 pm on Oct 1, 2006 (gmt 0)

...write a letter to Business Week concerning this article?
Maybe they will publish it.

Fat chance, a total waste of time. Composing the complaints right here is much more productive.

Great. BW dies and what takes its place? 500 parked domains.

You're looking at one intelligent alternative. With dozens of excellent sites about investing, business, etc. killing trees is stupid.

There are many financial websites with working subscription models, they sell display ads too but with less effect than ppc.

jessejump




msg:3104575
 8:20 pm on Oct 1, 2006 (gmt 0)

>>>>> Fat chance, a total waste of time

I disagree. Newspapers and magazines print critical letters all the time.

Preaching to the choir here does nothing.

Andreals




msg:3104622
 9:11 pm on Oct 1, 2006 (gmt 0)

I disagree. Newspapers and magazines print critical letters all the time.

Critical yes. Exposing their fatal flaw, I don't think so.

Preaching to the choir here does nothing.

Not true. We are honing an important argument, developing these ideas for our moment in prime time. Practice, practice, practice--when I finally take a bead on them for real, they're done.

We will win, don't waver.

kkobashi




msg:3104721
 12:14 am on Oct 2, 2006 (gmt 0)

Nah, this is just PR to make the stock go down :O)

Andreals




msg:3104752
 1:30 am on Oct 2, 2006 (gmt 0)

Nah, this is just PR to make the stock go down :O)

GOOG lost 16 points on the 18th on Yahoo's bad ad numbers, but hasn't changed much during the week of this article. So if the guys over at BW shorted GOOG thinking invsetors cared about their silly cover story they got their comeuppance. :)

gregbo




msg:3105939
 10:18 pm on Oct 2, 2006 (gmt 0)

To the extent that BW advertises and is supported by ads online, they are exposed to click fraud, so it's not as if they are merely throwing stones at search engines. (This is not to say that I agree with everything in the article.)

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