Click Fraud Report


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This document covers research on how click fraud works, click fraud history and Google strategy towards click fraud.

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Click Fraud Report

  1. 1.       CLICK  FRAUD  REPORT   EXECUTIVE  SUMMARY   This  document  covers  research  on  how  click  fraud  works,  click  fraud  history  and  Google  strategy   towards  click  fraud.  
  2. 2. CLICK  FRAUD  REPORT   EXECUTIVE  SUMMARY   Competitors  of   AdSense  publishers     Click  Fraud  usually  requires  a  lot  of  IP’s  (spread  geographically)  to  fool   advertising  companies;  one  of  the  best  ways  to  stop  this  is  by  giving  IPs  to   requesters  with  strong  justification  regarding  utilization.    For  more  details   please  refer  Appendix  A.   These  persons  may  wish  to   Data  centers  are  not  giving  away  IPs  in  excess  of  8  or  10.    This  can  be   exceeded  based  on  personal  or  organizational  relationships.   AdSense  and  other  banner   For  any  additional  IP  request  one  needs  to  submit  form  to  ARIN  (For  USA)   explaining  in  detail  how  we  plan  to  utilize  these  IP’s.  One  needs  to  confirm   that  at-­‐least  80%  to  85%  of  all  IPs  will  be  utilized  and  will  not  be  misused.    For   more  details  please  refer  Appendix  B.   Google  overtime  has  improved  invalid  click  tracking  and  for  some  accounts  it   has  been  observed  that  a  good  number  of  clicks  were  marked  as  invalid.    For   more  details  please  refer  Appendix  C.   Google  uses  sophisticated  algorithms  with  a  high  degree  of  scientific  accuracy   for  protection  against  invalid  clicks.  For  more  details  please  refer  Appendix  D.   frame  online  website  ,  which   generate  revenue  through   advertising.  It  is  made  to  look   like  website  (Keyword)  owner   is  clicking  on  its  own  ads  to   make  profit.  The  advertising   network  may  terminate  may   then  terminate  the   relationship  with  that   particular  website.     Click  fraud  is  rising  and  so  are  Google’s  efforts  to  curb  the  nuisance.    For  more   details  please  refer  Appendix  E.                                   1
  3. 3.       HOW  CLICK  FRAUD  WORKS  (APPENDIX  A)   There  is  a  huge  pool  of  marketing  techies  who  have  mastered  this  art  of  click  fraud.  Normally  they  create  a   network  of  users  who  make  profits  by  clicking  on  ads.  There  might  be  hundreds  or  even  thousands  of  people   who  just  do  nothing,  but  click  on  sites.   Google  and  yahoo  have  been  trying  hard  to  cut  down  click  fraud,  but  it  is  virtually  impossible  for  them  to  nullify   click  fraud.   It  is  estimated  that  10%  to  15%  of  all  clicks  are  fake,  and  300-­‐500  million  dollars  of  advertising  budget  get   exhausted  each  year  into  click  fraud.   However,  there  are  various  benchmark  tests  which  you  can  follow  to  detect  fake  clicks.   These  are  as  given  below:-­‐   • • • • If  you  observe  an  unusual  click  trend  or  CTR  (Click  through  Rate)  in  your  ad  words  account  then  it  could   be  an  indication  of  click  fraud.   You  should  manually  monitor  your  ad  words  account  to  detect  click  fraud.  In  case  you  observe  a  sudden   increase  in  no  of  clicks  within  shot  timeframe  of  15-­‐30  minutes  during  a  day,  then  it  could  an  indication   of  unusual  click  trend.  Moreover  if  none  of  those  clicks  actually  convert  into  lead,  then  it  could  be  an   indication  of  click  fraud.   You  are  receiving  5000-­‐15000  clicks  from  AdSense,  but  none  of  those  clicks  actually  get  converted  into   lead.  Moreover,  if  you  observe  sudden  drop  in  conversion  rates,  then  it  could  be  an  indication  of  click   fraud.   Normally  fake  clicks  originate  from  1  or  2  particular  locations  (depending  upon  your   competitors/industry).If  you  observe  a  regular  pattern  of  several  clicks  from  one  geo  location,  but  none   of  those  actually  converting  into  lead,  then  it  could  be  an  indication  of  click  fraud.  You  should  keep  tabs   on  clicks  from  suspicious  or  untraceable  IP  addresses.   There  are  business  sectors  like  online  marketing  website  development  where  click  fraud  is  really  high.  Click  fraud   is  also  evident  in  other  business  fields                     2
  4. 4.       ARIN  (APPENDIX  B)   ARIN  provides  services  related  to  the  technical  coordination  and  management  of  Internet  number  resources.   The  nature  of  these  services  is  described  in  ARIN's  mission  statement:   ARIN,  a  nonprofit  member-­‐based  organization,  supports  the  operation  of  the  Internet  through  the  management  of   Internet  number  resources  throughout  its  service  region;  coordinates  the  development  of  policies  by  the   community  for  the  management  of  Internet  Protocol  number  resources;  and  advances  the  Internet  through   informational  outreach.   These  services  are  grouped  in  three  areas:  Registration,  Organization,  and  Policy  Development.   Registration  Services   Registration  Services  pertain  to  the  technical  coordination  and  management  of  Internet  number  resources.  They   include:   • IP  address  space  allocation,  transfer,  and  record  maintenance   • ASN  allocation,  transfer,  and  record  maintenance   • Directories   • Registration  transaction  information  (WHOIS)   • Routing  information  (Internet  Routing  Registry)   • DNS  (Reverse)   • Who  Was           3
  5. 5.     GOOGLE’S  TOP  PRIORITY:  (APPENDIX  C)   The  security  of  Google  Ad  Words  advertisers  is  a  top  priority  for  Google,  and  Click  Fraud  is  a  growing  concern  for   small  business;  with  research  showing  a  rise  of  click  fraud  by  almost  20%  in  2010.   Some  competitors  will  deliberately  generate  and  click  on  your  ads  repeatedly  in  an  attempt  to  exhaust  your   daily  budget  sooner  and  bump  up  the  costs  of  running  your  Ad  Words  account;  this  is  click  fraud.   Certain  patterns  in  your  Ad  Words  account  can  be  observed  to  determine  if  you  are  experiencing  this  type  of   fraud,  for  example,  you  may  notice  a  sudden  and  large  increase  in  Impressions  and  Clicks  for  a  keyword  of  high   cost  and  competition.   There  are  ways  to  ensure  that  a  competitor  isn’t  able  to  perform  this  fraud;  which  you  can  do  yourself.  Google   Ad  Words  account  holders  have  the  option  to  exclude  up  to  100  Internet  Protocol  (IP)  addresses  from  seeing  Ads   within  their  campaigns.  All  Ads  in  the  campaign  are  prevented  from  being  displayed  for  users  with  the  IP   addresses  that  you  specify,  so  choose  your  list  carefully.   An  important  note  about  IP  address  exclusion:  Some  large  internet  service  providers  (ISPs)  use  a  range  of  IP   addresses  for  all  their  users.  If  you  exclude  an  IP  address  that  is  a  proxy  for  many  users,  you  could  be  blocking  a   large  amount  of  legitimate  and  potentially  profitable  traffic.  Google  takes  no  responsibility  for  this  action.   In  saying  all  this,  Google  does  have  its  own  measures  in  place  for  preventing  click  fraud.  Each  click  you  get  is   examined  by  a  system  of  theirs  that  looks  at  the  IP  address,  time  of  click,  any  duplicate  clicks  and  a  few  other   click  patterns.  These  factors  are  then  analyzed  by  their  system  to  isolate  and  filter  out  any  patterns  that  appear   to  be  deliberately  driving  up  the  costs  of  advertisers’  clicks/impressions.       4
  6. 6.     DETECTION  OF  INVALID  CLICKS  –  EXTRACT  FROM  GOOGLE  ADWORDS  WEBSITE  (APPENDIX  D)     The  systems  and  processes  that  Google  uses  to  detect  and  filter  invalid  clicks  can  be  divided  into  three  types:   Proactive   1.  Filters   • • Automated  algorithms  which   filter  out  invalid  clicks  in  real   time,  before  they  are   charged  to  advertisers’   accounts   Analyze  all  clicks  on  Ad   Words  ads   • Automatically  discard  clicks   and  impressions  from  known   sources  of  invalid  activity   • Reactive   2.  Offline  analysis   • • • Automated  algorithms  and   manual  analysis   Focuses  on  the  AdSense   network,  but  also  includes   Google  sites  and  those  in   other  networks   Accounts  for  a  much  smaller   proportion  of  invalid  clicks   than  that  detected  by  our   automated  filters   3.  Investigations   • Relatively  rare   • All  advertiser  inquiries  about   invalid  clicks  are  investigated   by  Google  and  taken  very   seriously   • The  number  of  invalid  clicks   detected  by  investigations  is   negligible  relative  to  the   number  detected  by  filters   and  offline  analysis   Account  for  vast  majority  of   invalid  click  detection     How  Advertisers  are  protected:   The   Ad   Traffic   Quality   Team   helps   protect   advertisers   against   click   fraud   by   working   to   isolate   and   filter   out   potentially   invalid   clicks   before   they   ever   reach   your   account   reports.   Although   the   intent   of   a   click   is   difficult   to   determine  with  a  high  degree  of  scientific  accuracy,  we  try  to  identify  suspicious  clicks  as  often  as  possible  and   to  exclude  additional  clicks  which  we  know  will  perform  poorly  for  advertisers.  By  casting  a  wide  net,  we  try  to   maximize   the   amount   of   invalid   clicks   that   we   exclude,   which   helps   us   to   deliver   consistent   and   high-­‐quality   traffic  to  advertisers.   Undoubtedly,  some  portion  of  the  invalid  click  activity  is  not  detected  by  our  proactive  systems  and  processes.   However,   we   are   able   to   effectively   minimize   that   proportion   through   our   proactive   monitoring   of   both   advertiser  and  publisher  networks.  Our  belief  in  the  quality  of  the  sites  in  our  network  and  the  accuracy  of  our   automated   filtering   is   supported   by   the   reactive   investigations   we   undertake   on   behalf   of   advertisers   who   contact  us  with  concerns.  We  have  found  through  reactive  manual  reviews  that  our  proactive  monitoring  misses   only  a  fraction  of  all  potential  invalid  click  activity  and  our  team  continually  works  to  improve  this  even  further.   5
  7. 7.   How  we  Help  Protect  Publishers:   The   relationship   between   Google,   advertisers,   and   publishers   is   based   on   trust.   As   a   result,   Google   treats   any   instance  of  invalid  activity  very   seriously.  In  order  to  help  protect  advertisers  and  publishers  from  invalid  click   activity,   Google   carefully   monitors   all   clicks   and   impressions   on   ads.   With   a   clean   network   we   preserve   the   advertisers’  trust,  which  means  better  earnings  for  publishers  with  clean  traffic.   We  understand  that  sometimes  a  third  party  may  generate  invalid  activity  on  your  ads  without  your  knowledge   or  permission.  We  know  that  these  clicks  are  not  the  result  of  genuine  interest  in  your  products  and  services,   and   regularly   work   to   improve   our   system   to   detect   these   clicks   and   filter   them.   Not   only   does   this   help   protect   publisher  accounts  from  sabotage,  it  also  ensures  that  advertisers  are  not  charged  for  the  filtered  clicks.   However,   AdSense   publishers   are   ultimately   responsible   for   all   of   the   traffic   to   their   ads.   As   a   publisher,   we   recommend   you   follow   our  policies  and   diligently   monitor   your   traffic   to   minimize   invalid   activity.   We   also   encourage  publishers  to  report  any  suspicious  activity  which  they’ve  detected  on  their  site.         6
  8. 8.     LITTLE  HISTORY,  HIGH-­‐PRICED  KEYWORD  CLICK  FRAUD  RISES  (APPENDIX  E):   The  Click  Fraud  Index  did  something  a  little  different  with  its  second-­‐quarter  report  on  click  fraud,  as  tracked  by   the  over  1,300  advertisers  and  agencies  participating  in  Click  Forensic’s  research.  They  split  out  the  click  fraud   rate  for  higher-­‐priced  search  terms,  priced  at  $2  and  higher.   Overall,  their  research  for  the  period  found  that  industry-­‐wide  click  fraud  had  increased.  The  first-­‐quarter  figure   of  13.7  percent  was  outpaced  by  the  second-­‐quarter’s  rate  of  14.1  percent.   Breaking  out  the  higher-­‐priced  keywords  showed  an  even  higher  increase.  Companies  participating  in  the  index   reported  click  fraud  at  a  20.2  percent  clip  for  those  keywords,  which  frequently  comprise  the  bulk  of  an   advertiser’s  spend.   “For  the  first  time,  we  have  industry  data  that  clearly  shows  what  many  have  expected  –  organizations   purchasing  higher-­‐priced  search  terms  are  significantly  more  vulnerable  to  click  fraud,”  said  Tom  Cuthbert,   president  and  CEO  of  Click  Forensics,  in  a  statement.     The  top  key  terms  averaged  $4.51  across  what  Click  Forensics  identified  as  the  top  five  search  advertising   industries:  Retail,  Financial  Services,  Health  &  Fitness,  Technology,  and  Entertainment.  That  was  down  from   $4.75  in  the  first  quarter  of  2006.   Rates  of  click  fraud  increase  dramatically  the  farther  one  gets  away  from  Google  and  Yahoo  for  search   advertising.  Click  Forensics  identifies  that  duo  as  Tier  1  search  providers.  For  the  second  quarter,  the  click  fraud   percentage  of  12.8  for  Tier  1  providers  was  a  little  higher  than  the  12.1  percent  reported  in  the  prior  quarter.   Tier  2  search  providers  (Ask,  MSN,  Lycos,  and  others)  had  a  click  fraud  rate  of  20.3  percent,  while  Tier  3  ones   (niche  sites  like  Dogpile)  racked  up  27.1  percent  for  the  second  quarter.  Both  figures  were  lower  than  their  first   quarter  percentages  of  21.3  and  29.8,  respectively.   Over  88  percent  of  click  fraud  takes  place  from  within  the  US  and  Canada,  the  report  noted.  Outside  the  US,   India  led  all  other  nations  with  unwanted  click  activity  rising  26  percent  during  the  quarter.   • • • Disputes  over  the  issue  have  resulted  in  a  number  of lawsuits.  In  one  case,  Google  (acting  as  both  an   advertiser  and  advertising  network)  won  a  lawsuit  against  a  Texas  company  called  Auction  Experts   (acting  as  a  publisher),  which  Google  accused  of  paying  people  to  click  on  ads  that  appeared  on  Auction   Experts'  site,  costing  advertisers  $50,000.  Despite  networks'  efforts  to  stop  it,  publishers  are  suspicious   of  the  motives  of  the  advertising  networks,  because  the  advertising  network  receives  money  for  each   click,  even  if  it  is  fraudulent.   In  July  2005,  Yahoo  settled  a  class-­‐action  lawsuit  against  it  by  plaintiffs  alleging  it  did  not  do  enough  to   prevent  click  fraud.  Yahoo  paid  $4.5  million  in  legal  bills  for  the  plaintiffs  and  agreed  to  settle  advertiser   claims  dating  back  to  2004.  In  July  2006,  Google  settled  a  similar  suit  for  $90  million.   On  March  8,  2006,  Google  agreed  to  a  $90  million-­‐settlement  fund  in  the  class-­‐action  lawsuit  filed  by   Lane's  Gifts  &  Collectibles.  The  class-­‐action  lawsuit  was  filed  in  Miller  County,  Arkansas,  by  Dallas   attorneys  Steve  Malouf,  Joel  Fineberg,  and  Dean  Gresham.  The  expert  witness  for  the  Plaintiffs  in  the   case  was  Jessie  Stricchiola,  an  internet  search  expert  who  first  identified  instances  of  PPC  click  fraud  in   2001.   7
  9. 9.   REFERENCES­‐keyword-­‐click-­‐fraud-­‐rises-­‐2006-­‐07­‐adwords/preventing-­‐google-­‐adwords-­‐competitor-­‐click-­‐fraud/­‐click-­‐protection.html               8