Media Analysis: Click Fraud Rears Its Head
Bogus clicks are costing US advertisers millions - and have the potential to do the same here.
Could there be rot lurking behind the glimmering faaade of search marketing, one of the fastest-growing media and the internet's advertising backbone? That is the question some US marketers are asking following the publication last week of a survey that estimates that online advertisers laid out dollars 800m due to fraudulent clickthroughs in 2005.
Although there is no comparable research on the UK's pounds 750m search market, those involved in the sector contend that it isn't a major problem - yet.
Click fraud - or bogus clicks on search links or advertising - is generated either by infected computer programmes or by hired operators, who are sometimes even outsourced to 'click-shops' in India, Russia or South Africa. The activity is funded by companies wanting to waste their rivals' online ad budgets.
In some cases, website owners have been know to engage in click fraud to inflate their advertising revenue, as brand owners often pay them for each click on a search-engine link or banner ad.
Supporters of search marketing say click fraud is easily detectable, and both media owners and agencies can track it by monitoring their advertising campaign web logs and websites.
Amanda Jones, head of search at digital agency i-level, says: 'The majority of brands using paid-for search are looking for a tangible return - orders, requests and so forth. If you see a spike in clicks going up when you are not used to seeing user activity - often in the middle of the night or weekends, say - and if you don't see the same spike in your post-click analysis, then you know that something is wrong.'
Major online media owners in the UK, such as Google, Yahoo! and MSN, are on the trail of the cyber fraudsters. Google UK recently said, in a written statement: 'We have sophisticated technology that detects click fraud. We have many ways to look at the data to help us surface abuses quickly. While we cannot promise that we will be able to prevent all instances of click fraud, we are pleased with the results to date. We take the issue very seriously. We have devoted significant resources to managing the problem, believe we manage it well and believe it is a small problem.'
Richard Firminger, regional sales director for northern Europe for Yahoo!, says that though click fraud in the UK is relatively small, it is a problem Yahoo! is treating seriously. We have been doing lots about it for a long time,' he says. 'What is a good click and what is not a good click is always difficult to identity. What we look for are certain kinds of behaviour - repetitive clicks from the same IP address, for example, as we often work with advertisers on their web logs.'
Yahoo!, MSN and Google all reimburse advertisers with credits or discounts for clicks that they identify as fraudulent. Clients can query click patterns with media owners within 60 days of them occurring. But none of the media companies are willing to discuss the scale of the problem.
Jones says that in her five years of search marketing at i-level, there have been fewer than a dozen cases of click fraud, a view backed by Jim Brigden, managing director at The Search Works, who says: 'From our perspective, 90% of clicks are genuine. Last year, we spent pounds 25m on search in the UK and we got back pounds 250,000 in credits. …