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Assaf Nehoray's online ad campaign bogged down in Germany. The European businessman runs a Web marketplace for cargo firms; for the last two years he has attracted customers to his site by putting ad links on the major search engines. The model worked perfectly—until last summer. When he tried to expand into Germany, Nehoray found that his site was getting lots of new visitors but unusually few paying customers. Nehoray (who prefers we don't name his company) analyzed his Internet logs and made an unsettling discovery. Someone—perhaps a competitor—had written a simple software program that relentlessly clicked on his ads, burning up his ad budget and pushing his links off the search sites by lunchtime each day. After spending weeks complaining to Google about the problem and getting a partial refund, he finally yanked the ads. "It was really bad," he says, estimating that he lost $50,000 in potential business. "Nobody knows how to solve this problem."
Complete story - [msnbc.msn.com...]
"Advertisers worry that if fraud continues to escalate along with ad prices, they'll be forced to retreat to media like television."
How many search or contextual-content advertisers have the option of using television?
And if 10 to 20 percent of clicks are fraudulent (as one person quoted in the article suggests), how does that differ in practical terms from waste circulation in traditional media (e.g., people who are out of the room when the TV or radio is on, or people who don't see a certain ad on page 78 of a magazine)? In the end, isn't it ROI that counts?
Realistically, a certain level of click fraud will always exist, just as "waste circulation" and circulation scams exist in traditional media. The challenge for PPC media isn't how to eliminate click fraud, but how to keep it to manageable levels so that PPC remains a better value than the alternatives.
Click fraud even has a positive side effect: better CTR, and thus a better chance to move up the ranks. It's almost like an indirect added fee for improving one's ad ranking.
The thing that would concern me most as an advertiser is impression spamming. Much harder to police, and there are no direct losses, just a dilution of CTR and consequent free-fall down the rankings.
I believe anyone would be qualified to say that these companies can absorb the cost.
Congratulations. You made a snap judgement based upon one search in one keyword sector.
I'm not discouraging nor encouraging clickfraud. But to say that a business should simply absorb fradulent clicks because it can afford it is not only wrong, it's ignorant.
reading the article helps:
"Someone—perhaps a competitor—had written a simple software program that relentlessly clicked on his ads, burning up his ad budget and pushing his links off the search sites by lunchtime each day"
if you sell $10,000 a day with Google ads and the day you yank them (or ad money runs out becuase of fraud) it drops to $8,000 it's not that hard to do the math.
Fischerle, why don't you tell us what your ads are so someone can help you increase your CTR and reap the benefits or click fraud. Don't let Ameriquest, eLoan etc. have all the fun.
"What a dumb article, this issue is so overblown. Companies spending 12 dollars a click are the ones most likely to be able to absorb some fraud. Who cares? The system isn't perfect, and never will be. Severe fraud will be caught and reimbursed, minor fraud can and will be absorbed as a cost of doing business.
Click fraud even has a positive side effect: better CTR, and thus a better chance to move up the ranks. It's almost like an indirect added fee for improving one's ad ranking."
I had a guy steal ALL of the content from one of my sites over the weekend and put up a site of his own with his own AdSense ads. He forgot to take my tracking scripts off the page and I sat and watched him commit click fraud (repeatedly visiting his own site and clicking on the ads that appear on the home page). I've passed all of the info I have onto Google...hopefully they'll do something about it. I know for a fact that the ads showing on that site are NOT $12 per click ads, so anyone saying that is where the click fraud is happening needs to think again.
If statistically unnoticeable fraud is occurring, one will never know. Why get your panties in a twist? It's a cost of doing business.
Edit: I should add, though, that potential fraud is the main reason I always opt out of the content network, and usually advise my clients to do the same. Google has a lot of work to do to make Adsense a more transparent and accountable program.
Dumb article? You've got to be kidding me.
Go talk to some small businesses who are paying $3, $5 or $10 per click and ask them what they think when they repeatedly find their competitors clicking on their ads.
2 clicks per day @ $5 per click is $3500 per year. This will not get flagged as fraud. Now add in the competitors friends doing some part time clicking and you can easily reach $10,000 by one competitor. That is a lot of money for a small business.
And the comment about eLoan etc being able to absorb the cost of click fraud is also ridiculous. Sure they can absorb the cost, but obviously you don't mind paying more for your mortgage because you can absorb the cost as well.
I was being sarcastic.