Advertisers generally hope a banner ad will do one of two things. Ideally, a visitor to a Web site that posts a banner ad will click on the banner and go to the advertiser’s Web site. This is called a clickthrough. In this case, the banner ad has brought the advertiser a visitor they would not have had otherwise. The banner ad is a real success if the visitor not only comes to the site, but also stays and buys something. Clicks or Click-throughs are defined as the number of visitors who click on the banner ad linking to the advertiser’s Web site. Publisher sites sell banner ad space on a cost-per-click (CPC) basis.
Click fraud can be initiated through an automated click generation method, or by humans. A common method is by using online robots or “bots,” that are programmed to click on advertisers’ text links that are displayed or listed in search queries. Another method is to employ low cost workers (another way to outsource fraud offshore) to click on text links and other Internet advertisements. A third method is executed by employees of rival companies who click on competitors’ ads in the hope of exhausting the competitors’ marketing budget.
Although click fraud has been happening since the cost-per-click pricing model was implemented, it has only recently received a lot of attention. This is due to, among other things, online advertisers becoming more sophisticated with respect to the cost-per-click pricing model. Another reason for the increased exposure relates to the greater competition for desirable keywords, which has resulted in a marked increase in the price paid by some advertisers for certain keywords, which in turn has resulted in a substantial increase in the overall cost of per-click programs for most advertisers.
The problem is quite serious as the cost for advertisers can be relatively high in some sectors. In mortgage refinance or legal, it could cost advertisers several dollars per click.
Interestingly, some advertisers have not pushed the issue with search networks out of a fear of jeopardizing their relationship with them. It is impossible to measure with accuracy the extent of click fraud. However, some estimates put it as high as 50 percent of total ad clicks!
Technologies that measure click rates have been developed to curb the trend of click fraud. For example, http://www.whosclickingwho.com/ sells technology to examine click rates and sales that result from paid searches.
Another approach to fraud-detecting technology is a tracking system that analyzes Web traffic logs to detect consistent patterns of behavior over a period of time. For example, if a page is turned every 1.5 seconds over a period of time, the traffic might be flagged as suspicious.
With the ever-increasing amounts of money being spent on per-click advertising, and the great potential for abuse inherent in the system, it is no surprise that the anti-fraud click business is in its infancy, and will grow more sophisticated over time.