Pay-per-Click Fraud
No discussion of pay-per-click is complete without a discussion of pay-per-click fraud. Opinions vary on how preponderant this practice is. No search engine willingly publishes statistics on so touchy a subject, and all claim to combat it.
Most SEO experts believe that between 20% and 35% of all paid clicks generated on pay-for-click engines are fraudulent, even on such established players as Google, MSN and Yahoo.
Since this has grown in 2005 to be a $5 billion industry, over $1 billion of that is going into the pockets of those abusing the system. That a lot of incentive for mischief...
Those indulging in click fraud range from amateurish wannabe's who see overnight riches flowing from a $12 Adsense acccount - soon to be caught by Google and kicked out of the program, to ruthless competitors driving up your cost of advertising, to professional criminal organizations armed with sophisticated software and employing low-cost labor from third world countries.
How does this affect me?
- Accept the fraud as the "cost of doing business" and factor it into your overall return on investment. If the ROI is still positive, don't sweat it. This really only makes sense for small advertising budgets. If you're not sure of how much money you may be losing, try using ClickSentinel's Fraud Impact Calculator.
- Get a superb click management system - whether self-administered or as as subcontracted service. We like the services offered by ClickSentinel, because it not only detects the fraud, but also helps you automated the process of reporting the fraud to the pay-for-click engine. At an average cost of less than a fraction of a penny per click, it is well worth it.
- Use one of the newer pay-per-click services, such as Blowsearch, whose build-in click fraud avoidance system was recently featured in a Wired magazine article.