Click fraud consists of web site owners clicking on their own ads (network click fraud) so as to generate higher revenue fraudulently. It also consists of competitors clicking on each other's ads (competitive fraud) to ensure that the competition pays higher bills for PPC advertising; this is done in an effort to reduce competing bidders. The current pay per click model, based on Overture's PPC system, includes several layers to protect advertisers from fraudulent clicks. One filter screens out known fraudsters in real time, then statistical analysis is done by human reviewers to check for possible fraudulent clicks; finally, there is correspondence with the advertisers (reporting). Google's method of screening is similar to this model.
Google Says
Shuman posted on Google's fight against click fraud after giving Andy Beal over at http://www.marketingpilgrim.com/ an exclusive interview during an SES conference, where a two percent click fraud percentage was seemingly inferred. The error made by Beal (www.marketingpilgrim.com/2006/12/google-click-fraud-rate-two-percent.html) has since being corrected.
Ghosemajumdar implied that Google has exact figures on click fraud percentages and on invalid clicks, but that the company would be unwilling to share the information over fears that it will reveal secrets about its competitive advantage in PPC. However, he said the figure for click fraud is not two percent, but that the figure is LESS than two percent. Actually the exact word on his blog was "negligible." When pressed by questions posted on his blog, he repeated "single digit" figures. For his articles and comments check out www.shumans.com/articles/000044.php and www.shumans.com/articles/000045.php.
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