The Great Click ‘N’ Fraud Swindle

    February 28, 2006
    WebProNews Staff

A variety of scams, fraudsters, and software tools could contribute to as much as a billion dollars of fake click activity each year.

Worse, the Googles and Yahoos of the world may not care as much about fraudulent click activity, a BusinessWeek report contended. That article recounted the experience of consultant Greg Boser, who set up a clickbot to begin hammering away at advertisements leading to his clients’ websites. Boser informed his clients of the plan, gained their approval, and promised to repay charges associated with his testing.

The problem exists because of a lack of transparency of the pay-per-click business model. Users have no way of seeing the data collected by Yahoo or Google to know just how much activity is due to click fraud. Both companies have stated they are addressing the problem, but will not provide any specific data.

That has led to the need to address the problem outside of the search engines. Recently, ClickTracks introduced software to help clients tell whether advertising clicks for their sites are simply problem campaigns that need to be tweaked, or if activity is more likely due to click fraud.

The lack of transparency from the search engines proved itself during a conversation I had with a ClickTracks spokesperson, who declined to even estimate how much click fraud could be taking place in the marketplace. All that industry insiders and observers can do is guess at a figure, and some sources claim that to be as high as 20 percent, or even more, of the click activity going on today.

Click fraud will be an issue for the two new players in contextual advertising. Amazon has been testing an ad network in controls with some third-party publishers. MSN debuts its adCenter services this summer, when its existing contract with Yahoo’s Overture ends in June.

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David Utter is a staff writer for WebProNews covering technology and business.