Click Fraud by Bots Could Cost $6.3 Billion in 2015

[engine]

So, here's another look at the attack on online advertising spend. Bots are one of the culprits this time, and it seems there's little that can be done about it right now. It's not just Google that's impacted, of course: Everyone involved in the ad business, including Microsoft, Yahoo, and advertisers big and small. Publishers are at risk, too, as they see their ads earning less and less.

The report indicates that in 2015 bots could impact advertisers by as much as $6.3 billion. Of course, that just an estimate for the year, and takes into account what appears to be a bot, rather than a human. It's challenging to get precise figures, but, with the rise of bots, advertisers may have to accept there's going to be some loss involved in their online advertising.

Not only is there a problem with ad blocking software affecting publishers [webmasterworld.com] and advertisers [webmasterworld.com], but mobile, the biggest growth sector, is particularly challenging to get a good ad performance simply though the technicalities, and fat finger syndrome.

The most startling finding: Only 20 percent of the campaign’s “ad impressions”—ads that appear on a computer or smartphone screen—were even seen by actual people.

“The room basically stopped,” Amram recalls. The team was concerned about their jobs; someone asked, “Can they do that? Is it legal?” But mostly it was disbelief and outrage. “It was like we’d been throwing our money to the mob,” Amram says. “As an advertiser we were paying for eyeballs and thought that we were buying views. But in the digital world, you’re just paying for the ad to be served, and there’s no guarantee who will see it, or whether a human will see it at all.” Click Fraud by Bots Could Cost $6.3 Billion in 2015 [bloomberg.com]

In this report, researchers claimed that Google [webmasterworld.com] has been charging advertisers for YouTube ads, even if it suspects an ad was viewed by a bot.

This really is becoming a major issue for the advertising industry, just as it has been for many years with site statistics being skewed.

[Leosghost]

@IanCP

I would put it more like..
they get debited by G=X>you get credited by G=X-G's"cut"=Y>( click fraud is found=Z )>you get debited by G=Y-Z> G claim to credit advertisers Z So advertiser gets a G ads "credit" ( but is it to the value of Z ? ) ..and a "credit" note that can only be spent at G..is not actual cash back....cash which the advertiser might need to pay rent, materials, or payroll..

Few years ago..I knew someone ( let's call him M )who clicked, once per day on their "competitor's" ads ( the "competitor"( let's call him S ) was actually their brother's business, they were both in the same line of work..they had a long standing feud, which led to one of them setting up in direct competition with the other, in a small town ) ads..

S "burned through" a couple of thousand Euros in adwords ( including the content network ) in a very short time..Then he quit advertising on Google, because it was bringing no extra business and he wasn't made of money..

It was later when his brother M told me about how he, or his secretary clicked once per day on the ads on Google placed by S..to "teach him not to be too big for his boots, who does he think he is advertising on Google" )..S had told all his friends that he was "on Google"..many of them saw his ad and clicked for curiosity..

S later moved to near by my place..around 250 metres away..as neighbours we got talking..he asked me if I'd seen him "on Google"..I said yes..and without telling him what his brother had done..I asked how it had gone..he told me he had spent what was for him a lot of money , fast, Google had taken it from his credit card..When he saw that he had already "spent" over two thousand Euros, and had no more business than usual..He stopped the ad account quickly..actually his accountant did it for him..the accountant knew a little about adwords..

He knew that some people had clicked his ads out of curiosity, ( they had told him so ) but did not feel too badly about them..

I asked if he had received any money back from Google for those "curiosity clicks"....Nope ..nothing..no credits..nada..

I didn't tell him what his brother had been up to.. He already felt like an idiot for "throwing money" away on Google ads..

Maybe his business wasn't suited to G ads..probably the case..

But a click per day, always from the same IP, should have said "fraudulent clicks" to Google..maybe it did..but S didn't get one centime of credit or money back from Google..

I don't believe that they cheat on the percentages that they have declared publicly about the publisher / google "split"..

But for me ..that case was tangible proof that either they did not monitor for fraudulent clicks properly..or they knew about them, but didn't always credit or return money to advertisers spent due to "fraudulent clicks"..Some advertisers here have said that they do get credits..I believe them, so G are not "holding back" all of the time...

But for me.."once bitten" ( even if it was my neighbour S who was "bitten" and not me personally ).."twice shy"..

Plus ..again , even when they do put "credits" back into an advertiser's adwords account due to "fraudulent clicks"..a credit that you can only use against more ads via Google..is not the same as having the actual money that you paid Google per click on your ad, that went out of your bank account to google, returned as actual money..

Probably falls under "malicious" as described by IanCP..

Then there are all the studies that have been made , particularly since ads began being served on "mobile phones"..Most of them say that at least 50% of all clicks on ads, on mobile devices are accidental..Most advertisers report that the ROI on mobile ads is not good compared with desktop..None of them report an increase in credits to their accounts..all do comment on how fast their adwords accounts burn through money..logically if around 50% of clicks are accidental on mobile, they should be seeing around 50% of clicks being "credited" back to their accounts..

None report that they are seeing this..

re IanKelley's post ( made while I was typing )..Yes most fraudulent clicks are connected to crooked publisher accounts..

Those clicks that are routed through the dishonest publishers sites ,if Google does not declare them "fraudulent"..Google takes around 30% of the money that the advertiser paid for each click..the fraudsters get the rest..The advertiser..sees the "actual money" disappear from their bank account ..

"Heads" they, ( Google ) win, "tails" they, ( Google ) win..

[toidi]

Who benifits from click bot fraud? Goog.

who lets click fraud happen? Goog

if these click fraud bots were looked at closely, i wonder if it could be determined were they come from?

as an advertiser, i showed them where, when and what sites the fraud was coming from. Even had a live person to talk to. They ignored me and my problem.

[IanKelley]

That sucks... and I don't just mean that out of sympathy.

Once upon a time if you found questionable traffic as a G advertiser you could get it credited fairly easily. You didn't even need to prove it much of the time. If you did have solid proof a credit was guaranteed.

I ran into a similar problem using the partner network (for the first time in many years). The traffic was epicly bad and no one I spoke with in the Adwords dept seemed to have even a basic understanding of click fraud. I also discovered that they have zero collaboration with the Adsense team. Which maybe makes sense from an antitrust standpoint but that's about it. Adsense is presumably where a lot of the good anti fraud engineers are working.

Which leads me to believe the problem is large corporationitis. Too many people, too many departments, too little communication. And a lot of hires that look good on paper but have no knowledge of the niche they get assigned to.

TLDR: Avoid the 'partner network' like the plague.

[Leosghost]

^^^especially what used to be known as "the yahoo partner network"

[magician]

Having a bot click on my site, even if undetected by Google seems pretty pointless to me, unless the intent is purely malicious - "we do it because we can cause havoc" - mentality.

I think it's just the game of percentages.
Say, 1% of the total bot clicks goes undetected by the ad networks.
Say, 99% of these undetected clicks happen on good websites and only 1% happen on bot creator's websites (to avoid suspicion).

They will make money on 0.01% of the total bot clicks which on large scale can be a big number.

[seoskunk]

Very good article full of great info. Thanks for sharing

About ten years back there was a class action for click fraud. I signed up, life has never been the same since. The fact is it takes only a few minutes to set up an effective click fraud bot. And the systems that are in place are designed for revenue not for click fraud ~ the system is deliberately easy to cheat. Yahoo Partners, I heard the unofficial story on this wasn't it allegedly shut down due to multi million pound click fraud by its publishers that allegedly Yahoo were aware of?