Auditing Paid Listings & Click Fraud Issues

The moderator begins by introducing the people on the panel. It is a wide group of people that expertly represent those that are doing something about or with paid search and click fraud issues. He also talks about the things that have gone on since the last time they conducted this session. There is a lawsuit that is going on against Google (CLRB Hanson Industries vs. Google). The S&P have downgraded Google in part due to click fraud issues. There is rumblings of click fraud on the “SEC radar” and is looking into click fraud. The firms Fair Issac & Alchemist Media announce “most rigourous study ever of click fraud”. Greg from WebGuerilla clickbots his clients in the name of science. Click Forensics launches the Click Fraud Network.

They go into various types of click fraud. The type of fraud for Financial Gain such as contextual ad affiliates clicking for dollars. The competitive advantage such as clicks to drain competitors PPC advertising budget. Revenge is also a type of click fraud. Blackmail or exploitation of a network is possible and finally Anarchy is a type of click fraud. Any type of malicious activity under click fraud should be under consideration. One of the speakers mentions that sometimes the search engines get it wrong that there are cases where real clicks are counted as fraudulent. Greg Boser next goes into competitive sabotage and the example of Mesothelioma on area that has been exposed to random sabotage. He says the clickbots are running rampant in Google’s domain parking system. I wonder if the same thing is happening with Yahoo? He goes onto explain an example of someone going to a domain by typing in url, doing a search, and then click on an advertisers ad 200 times, and the search engine giving credit for those clicks as real.

So is there too much paranoia with click fraud? Not necessarily some of the speakers say. It’s a big threat to Google’s business model and it’s a serious issue. However it can be difficult to look at a lot of data and Yahoo mentions they want to partner with firms to compare data. In the last 2-3 years there has been a big rise into the click fraud sanitation industry, there are more options and more companies offering click detection techniques.

There are several click fraud detection methods.

• Manual clicks (from individuals or “armies”) – this is not an efficient method however as its easier to catch as dozens of IP’s are needed and lots of people.
• Fake or masked IP (core of using proxies)
• Non-successive clicks
• Destroyed referrers
• Click bots

They next go into talking about proxies. Greg mentions that the highest risk click fraud is those potential malicious people that use a system of spyware in combination with a clickbot. The spyware or virus installs and infects thousands of machines and then uses a clickbot to click on ads all day. The person who got infected has no idea what is going on. He said its very difficult to track, and is not sure what the search engines will do about it.

There are some tactics that search engines are using into combat click fraud. They are:

• Dedicated fraud departments
• Click filters
• Pattern recognition software
• ROI analysis
• Human intervention
• Review of advertiser documentation

Yahoo mentions that they evaluate clicks along 20 to 50 data points. Some of the data points include: IP address, user session information, user cookie information, looking at the network an IP belongs, user’s browser information, search term requested, time of click, rank of the advertisers listing, bid of the advertisiers listing, time of the search, time of the click. Both Yahoo and Googe do offer advertisers a process by which they can submit questionable clicks for review and verification. I will insert here that I have used these systems and they are very disappointing. It can be rather painful in order to get refunded for potential click fraud as various processes in order to contact Google/Yahoo are inane and tedious. One of the best ways to avoid the long process of trying to get money refunded for click fraud is to establish an effective click fraud detection tool from the start. Some of the search engine reps go into refunds that happen automatically for click fraud that can occur. I have discuess with some clients that even though they may get refunds, they don’t seem logically enough, a $20 dollar refund for a $60K a month spend is less than satisfactory. However there are many that do get probably funded and the search engines are becoming better on working with advertisers.

There are some ways that advertisers can track and document click fraud on there on. Some of those methods include:

• Referring IP address
• Successive clicks
• Click volume variance
• Odd traffic referrers
• Geography of clicks
• Seasonality
• Bills
• Credit notices

One of the speakers mentions a change to the terms of service Google did last Q2 in 2004. That before they said “Google states we detect most invalid clicks” to “Our goal is to detect most invalid clicks”. What!? She says that is rather broad, and they could be trying to cure world hunger for all they knew. There was criticism thrown at Google for this aspect, and if they would be more forthcoming then they probably wouldn’t be facing litigation and criticism. The Google rep responds with rebuttal to that. He says he does not know what the FAQ said that year, but that their network of advertisers has expanded a lot and the various policies of their advertisers are different.

Some possible solutions for combating click fraud:

• Greater Data Disclosure such as network/advertiser sharing, PPC network provided tools, and great advertiser control over contextual distribution.
• Industry Intermediary such as independent, cross-ppc networls
• Cost Per Acquistion (CPA) models

Greg next goes into to talk about some litigation issues and some of the stuff I mentioned below with low refunds for click fraud. He said he mentions a case where a lawyer from here in New York spent 2 million dollars and got a total of $325 refund. He says that is very insulting and unacceptable.

The Google rep counters to the argument that the reason for litigation against the search engines is that they have not been more forthcoming and gave disclosure. He disagrees with the responses from the other speakers. Yahoo counters that they have been tracking click fraud since the turn of the century. He is pretty fired up and defensive in his position.

The session was very good, and a lot of discussion going on. Some heated replies and overall you could feel some of the frustration of regular advertisers and search marketing firms in dealing with click fraud. The search reps seems to be rather defensive as well insistent that adsense returns good ROI and so on. This session was more about click fraud then auditing paid listings.

SES NYC Tag: sesny2006