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January 24, 2005
When Mice Attack - Internet scammers steal money with 'click fraud.'
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."
Internet advertising is booming. The industry raked in more than $9 billion last year, estimates PricewaterhouseCoopers, up from $7.2 billion in 2003. The fastest-growing segment, search-engine advertising, grew 55 percent alone, buoyed by Google's blockbuster IPO. But Assaf Nehoray and others like him are now wondering if those bright clouds have a dark lining: click fraud. Google, Overture and a raft of smaller search sites get paid by advertisers each time a visitor clicks on an ad link. Perhaps it's no surprise that the Internet—long a magnet for the unscrupulous—has minted a new breed of swindler that clicks on those links not to buy the advertised product, but to accelerate a rival's ad spending or even to collect part of the fee themselves (Using Google's AdSense program, Web-site publishers can run the ads posted by Google and share the revenue). Last month Google CFO George Reyes conceded that click fraud was a significant threat to his firm's burgeoning bottom line. "I think something has to be done about this really, really quickly, because I think, potentially, it threatens our business model," he told an investors' conference.
Online advertising firms are urgently trying to address the problem. Greg Stuart, CEO of the Interactive Advertising Bureau, a trade group, says that "ad buyers' lack of confidence in the industry's numbers is very serious." His group is running a "measurement task force" (Microsoft, Yahoo and Google are involved) that is working on developing a single standard to measure real clicks—and weed out fake ones. Spokespeople for Google and Yahoo's Overture ad division say they are tackling click fraud by developing software that looks for warning signs and filters out fake traffic, and by reimbursing advertisers who are able to document that they've been subject to fraud (neither will disclose their total reimbursements). Last November, Google also sued a Texas firm for allegedly signing up for AdSense, creating a Web site with Google ads and then clicking on them to earn money.
Despite new efforts to stop click fraud, the temptation for scammers is growing. Advertisers once bid pennies to place their links prominently alongside searches for words like "refinance." With traffic to the search sites skyrocketing, last week's bid for that word was $12 a click. Fraudsters have to generate only a few fake clicks to make a day's pay. Jorge Zuniga of Dallas-based ClickAssurance, one of a growing number of auditing firms that want to help advertisers identify fake clicks (and share the reimbursement), says he thinks 10 to 20 percent of all clicks on search ads are bogus. Scammers, many of them based overseas, use new automated software tools that mask identifying IP addresses and click only during slow periods of the month so that a sudden increase in clicks doesn't set off alarms. "The more in-depth we get into it, the more we think that these guys are really sophisticated," Zuniga says.
Advertisers worry that if fraud continues to escalate along with ad prices, they'll be forced to retreat to media like television. "In some ways, we're at the mercy of how seriously the search companies take this," says Chris Larsen, CEO of online mortgage site eLoan. In other words, search engines like Google need to do what they do best: search for the right answer.
By Brad Stone
Newsweek
Jan. 24 issue
http://www.msnbc.msn.com/id/6830802/site/newsweek/
Posted by Hans A. Koch at 10:45 AM | Comments (0)
January 18, 2005
CLICK-FRAUD Search Engine Trend Watcher and Statistics
Search Engine Trend Watcher is a free service that graphs the number of hits for any given search phrase over time, feel free to add any trend you like. Check out the term CLICK FRAUD.
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Submitted by dgtlmoon on Tue, 2005-01-18 13:56.
http://trendwatcher.koan.net/node/311
Posted by Hans A. Koch at 01:56 PM | Comments (0)
January 11, 2005
Click Fraud: Somebody Is Cheating You
Click fraud has been discussed among the affiliate and search engine marketing (SEM) communities for several years. Yet many online media buyers are unfamiliar with the term. Admittedly, when I began researching this topic, the first thing I learned was that I've got a lot to learn about click fraud.
I'm willing to bet you do, too.
Why is click fraud important? Simple: Click fraud means someone is cheating you and your clients. If we're vigilant protectors of our clients' interests, that should be important to us.
Click fraud is the practice of artificially inflating the number of clicks or conversions in an online campaign. This often occurs in search and affiliate marketing. The problem hasn't been discussed much outside of those environments. But click fraud potentially extends into any performance-based display advertising environments.
How prevalent is it? I've seen different figures stating up to 10 to 50 percent of click activity is suspect -- an astonishing number. In other words, your CPC (define) and cost-per-acquisition (CPA) buys are potentially half as effective as they could be because of fraud.
Who's stealing from you and your clients?
* The amateurs. Kids or people with no social lives set up small Web sites and become a part of an affiliate network or Google's AdSense program. To generate a little income, they get with other small site publishers and click on each others' ads.
* The pros. Unethical and criminal publishers set up elaborate Web site networks and automated systems (bots) to generate fraudulent clicks, conversions, or both. In addition, reportedly programs have been set up in places such as India, Russia, and China, where people are paid to click on ads.
* Your competitors. Believe it or not, sometimes your competitors want so badly to win, they resort to clicking on your paid search listing or within other performance-based environments just to drive up your advertising costs.
How can you prevent click fraud? For the most part, companies offering solutions are focused on the affiliate and search marketing arenas. I predict they'll expand their services to encompass performance-based display advertising very soon.
Here are some ways to get ahead of the curve:
* Be more informed. Search on ClickZ for "click fraud." It's a great place to start. And keep an eye out for the latest news regarding the problem.
* Implement tools. Click Auditor and WhosClickingWho are two.
* Hire an expert. Companies such as Alchemist Media and ClickAssurance.com help you audit SEM campaigns to identify evidence of click fraud. The same sort of triggers they look for in SEM campaigns can be extended to other media.
ClickAssurance is an Internet security firm specializing in preventing click fraud. It audits SEM campaigns on contingency. If it finds evidence of fraud, it negotiates a rebate with the search engines. ClickAssurance is compensated with a percentage of what it gets back for you and your client.
I met with ClickAssurance's Jorge Zuniga for a short lesson on what click fraud means to our industry. His message can be summed up in one of the first things he shared, "Click fraud is a much bigger problem than people think. It's unlikely that we can prevent it altogether. But it can be controlled."
ClickAssurance hasn't yet addressed performance-based advertising beyond the search realm. Yet Zuniga assures me it's something his technical team has taken a keen interest in.
Ideally, big third-party ad servers will buy companies that specialize in the detection and prevention of click fraud or build the capability in-house. It would be so convenient if all the auditing necessary to prevent click fraud could be done in one place. For example, when this problem is detected on a campaign and the advertiser is owed a credit from the publisher, it could be handled in much the same way we currently handle other discrepancies.
Click fraud is something of a ticking bomb and carries the same sort of reputation-besmirching potential as pop-ups and spam. If we address the issue now, we can get a handle on it before the industry panics. The last thing we need is yet another issue that causes people to lose confidence in online advertising.
There's a lot to learn about click fraud and how to control it. The good news is there's a lot of information out there on the topic. The best places to start are affiliate and search marketing sites and forums. The important thing is you be the one to bring the issue to your clients' attention, as opposed to them asking you about it.
BY Pete Lerma | January 11, 2005
http://www.clickz.com/experts/media/agency_strat/article.php/3456371
Posted by Hans A. Koch at 04:22 PM | Comments (0)
January 07, 2005
SEM ORG holds panel discussing Click Fraud
Search Engine Marketers in Dallas/Fort Worth Educate Businesses on Click Fraud in Paid Search Marketing
DFW Search Engine Marketing Organization holds panel discussing click fraud and its business and industry implications
Dallas/Fort Worth – Anyone involved in search engine marketing knows that click fraud, or the fraudulent “clicking” of paid search advertisements, is a big deal. Click fraud could threaten the success of any search campaign – and could potentially threaten the industry as a whole.
The Dallas/Fort Worth Search Engine Marketing Association (DFWSEM) will be hosting a panel featuring some of the top click fraud detection and click auditing firms in the business. Those who attend the panel will learn:
- how click fraud occurs
- how it will impact the industry
- what the search engines are doing to fight it
- who is perpetrating the fraud
- how you can prevent the fraudsters from depleting your search budget
Attendees will also hear an how a Dallas agency recently received a credit after discovering fraudulent clicks on their client's PPC search marketing campaign.
If you have any interest in paid search advertising for your company or your clients, don't miss this discussion on the most pressing issue in search engine marketing today.
FEATURED PANELISTS:
Click Assurance
[link]
Click Assurance is a Dallas-based Internet Security Company whose aim is to educate the PPC industry about the risks of click fraud and provide industry leading technology and service to our clients.
Who's Clicking Who
[link]
Who’s Clicking Who is an ASP-based PPC audit firm based in Santa Clara, California.
Question and Answer session to follow panel.
MEETING DETAILS:
Seating limited - to reserve your place, please RSVP to 972.831.2124
Date:
Monday, January 17, 2005, 6:30 PM
Cost:
DFWSEM Members: Free
Non-members: $10 at the door
Meeting Place:
Romano's Macaroni Grill in Addison / North Dallas, on
Beltline Road between Midway and the Tollway.
4535 Beltline Rd., Dallas, TX 75001
Phone: 972-386-3831 Dallas, TX 75001
Phone: 972-386-3831
[link]
ABOUT DFWSEM
The Dallas/Fort Worth Search Engine Marketing Organization is dedicated to educating businesses in the Dallas/Fort Worth area about the benefits of search engine marketing. The group meets once a month at various locations throughout the Dallas/Fort Worth Metroplex. To become a registered member of DFWSEM email info@dfwsem.org. Individual DFWSEM memberships are $75 for the first year. Corporate memberships are $175 for the first year and include 3 seats to monthly DFWSEM meetings. Additional seats for a Corporate membership are $50/year. All annual memberships receive a link from DFWSEM to your company web site, and a complimentary subscription to Revenue Magazine. MasterCard, Visa, Amex, and checks are accepted. DFWSEM meets the third Monday of every month at various locations around the Metroplex. For more information, visit [link]
Posted: 01/07/2005 08:39 am
http://searchengineforums.com/apps/webmaster.forums/action::thread/thread::1105115946/forum::conferences/
Posted by Hans A. Koch at 08:39 AM | Comments (0)
