Is Confidence in Paid Search Slipping?

    October 3, 2006

Click fraud, a term that describes when a paid search ad is clicked on by someone other than an interested consumer (e.g., a third-party who profits from the click because they get a percentage of the ad revenue), is the 1000 lb gorilla in the jungle that is paid search. How’s that for a metaphor?

Click Fraud awareness is growing as traditional media sources such as Business Week, which just published a cover story on the topic titled, “Click Fraud, The Dark Side of Online Advertising,” begin to pick up on the this very real problem at the core of Google and Yahoo’s payment model.

One disturbing quote from the article cites that, “A BusinessWeek investigation has revealed a thriving click-fraud underground populated by swarms of small-time players, making detection difficult.” That certainly sounds daunting and although the extent of the problem is unclear (BusinessWeek indicates that Click Fraud has a one billion dollar price tag and comprises 10-15% of all paid search clicks), there are a few take aways we want to leave you after you read the article that can help you manage your paid search campaigns and minimize click fraud.

  • Use a click fraud detection tool that provides documentation for fraudulent clicks – submit any disputes to the search engines as soon as you discover them. KeywordMax, for example, is a bid management tool that has built in click auditing which reports clicks by geographic location and IP address and will compare conversions from one time period to another to detect any variances in pattern.
  • Opt out of the content network if you fear click fraud – Both Google and Yahoo allow you to opt out of their content network and only advertise on the search engine results pages. This will eliminate click fraud from affiliate sites that display search ads alongside content (many of these “content” sites are just repositories for ads that people click on fraudently).
  • Pay close attention to your conversion metrics. It may be difficult or impossible to detect or prevent click fraud entirely, but if you watch your conversion metrics and stay within your CPA and/or revenue goals, then at least you won’t lose your shirt from fraudulent clicks.

Paid search is still an extremely effective and targeted form of online advertising, but click fraud is not acceptable. Unfortunately, we may need to live with it for a while longer until Yahoo, Google and other search engines step up and make a serious commitment to preventing it.

If they don’t, then CPA models that charge advertisers only when a coversion has been made may nudge search out of the online marketing spotlight. Organic search engine optimization may also see a resurgence of popularity due to the threat of click fraud.

Even CPA models have their flaws, however, with rogue affiliates using fraudulent practices to inflate the number of leads they get paid for. As advertisers, it’s important that we remain vigilant to these issues and absolutely get the message out to Google, Yahoo and other media vendors that fraud will not be tolerated.



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Michael Pedone is the President / CEO of, a search engine optimization and website marketing company <> located in Clearwater, Florida that specializes in getting targeted, eager-to-buy traffic to your site. You can catch him blogging at: <>.