Click Fraud is a growing problem for Adsense and other Pay Per Click (PPC) advertising programs.
The challenge that Google has with Adsense and click fraud is that they’re at risk of it happening from a number of angles.
One of the potential fraudulent activities if obviously from publishers clicking on their own advertisements (a big no no). Many publishers have been banned from Adsense for this. However another emerging problem is coming from Advertisers themselves – some of whom are developing systematic program for clicking on other advertisers ads to drive up their bills. Google are currently taking legal action against at least one advertiser for this reason. The Washington Post reports:
”The problem, according to a lawsuit filed last year by Google, is that Auctions Expert began clicking on the ads itself, artificially inflating the number of clicks and driving up the bills sent to advertisers.
Auctions Expert allegedly recruited as many as 50 people to click on online advertising, generating about $50,000 in ad revenue. The self-clicking was “worthless to advertisers, but generated significant and unjust revenue for defendants,” the Google lawsuit said.’
The problem of Click Fraud will become a bigger and bigger problem despite PPC programs instituting more sophisticated methods to monitor it.
‘Jessie Stricchiola, a click fraud expert who frequently represents advertisers seeking refunds from Google and Yahoo, estimates that click fraud accounts for as much as 20 percent of the clicks in some industry sectors. The president of AlchemistMedia.com, Stricchiola said tens of thousands of advertisers, who pay Google and Yahoo by credit card, are being overcharged daily, adding that neither search engine has a large enough staff devoted to monitoring the problem or fielding complaints.’
How will Click Fraud impact us as honest publishers? It is really yet to be seen – however one could speculate that there will be a number of flow on effects including:
• less advertisers – one of the biggest worries for Google with click fraud is that advertisers will become more and more disillusioned with Adsense and will put less money into it. Less advertisers means less competition for the keywords you and I target – which in turn means small payments per click.
• smaller share of revenue – it is becoming more common for click fraud disputes to end up in court – either with Google taking legal action out against fraudulent publishers or advertisers or with them defending action taken by advertisers. Their legal bills must be on the increase for these types of cases and the money has to come from somewhere – lets hope its not from a decreasing percentage of revenue being shared with publishers.
• risk for publishers? – I have spoken with one or two Adsense publishers in the past few weeks who say that they have been innocent victims of of click fraud occurring on their sites. Whilst I have no way of verifying their stories – they claim that Google has banned them from Adsense for reasons of suspicious activity on their accounts (ie clicking on their own ads). They argue that they did not do this and that someone else (possibly advertisers like the one’s mentioned in the article above) was responsible for the abnormalities in clicks on their ads. Once again I have no way of knowing if they are just making excuses for their own stupidity or if they are innocent victims of the fraudulent activities of others – however I see that this might become an increasing problem for publishers.
Only time will tell what the impact of click fraud will be upon PPC publishers – lets hope Google and other PPC providers keep on top of things and that the increased competition that Yahoo brings with their entering of the PPC market will keep things on the up and up for us all trying to make an honest living from PPC.