Michael Bradley, recently arrested for his boneheaded attempt to extort money from Google, is a wake up call to the PPC industry.

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Arresting PPC Fraud

He claimed to have developed software that would roam the web and click on AdSense ads, potentially costing both Google and their advertisers millions.

Once he’d developed his software he offered it to Google for $100k. When he didn’t hear back from them he threatened to release the program to 100 spammers and the public at large. He also offered his services as a click fraud consultant.

The FBI has him on tape, in Google’s offices, making his “pitch.”

Now consider a smarter click fraud engineer. His software allows fraudsters to type in competitor’s names and then crawl the web clicking on AdSense ads where his competitor’s ads appear. Perhaps it even clicks on AdWords ads for your competitor’s search terms.

Instead of trying to extort money from Google, this click fraud engineer sells his software to unscrupulous marketers, allowing them to steal their competitors’ ad budget.

Well, click fraud software already exists. I found some discussed in this WebMasterWorld thread. While I’ve never seen any advertised, I’m sure if you know the right people, or search terms, it would not be hard to find (I couldn’t find any when I searched on “click fraud software”).

How widespread is the use of PPC fraud software? I don’t have any numbers. How widespread is manual click fraud? Again, not much talk from Gooogle and Overture regarding the percentage of fradulent clicks.

Because of this lack of information advertisers have to rely on anecdotal evidence from forums to determine the rate of click fraud, and the problem with this type of information is that it’s only the most upset and indignant advertisers writing in, and is often biased against PPC.

I read an article recently from an organic SEO firm that argued against using PPC ads. The author pointed to click fraud as the main reason marketers should (pay him to) organically optimize their sites.

So if you’re using PPC what can you do?

First off, watch for paid clicks that don’t have corresponding page views. Be sure you’re tracking everything separately, down to the keyword.

If you have to make a fraud claim, be sure that you’ve documented everything – including emails to whoever’s hitting you with drive by clicks and emails to and from your PPC provider.

Finally, consider click fraud prevention software. Here are a couple I found but have not tested (and really, what more could they do than analytics software? The best defense is a good offense.)

http://www.keywordmax.com/click_auditor.html
http://www.whosclickingwho.com/

So here’s what I’d like to see from PPC providers – more information on click fraud prevention, both what they’re doing and what advertisers can do. Documented click fraud percentages would be nice too, and bring some much-needed transparency to the PPC industry.

I used this article on CPC Click Fraud for research.

Garrett French is the editor of iEntry’s eBusiness channel. You can talk to him directly at WebProWorld, the eBusiness Community Forum.