I really hope this works out for Bigreds. I am a small business (very) and I tried PPC ads. I never even had one sale converted and it wasn't because my pricing was'nt competitve, it is. Even $500 in a month when there are no conversions is still too much for my blood. I believe it was click fraud and after 4 months of it I decided to never do ppc again.
Bigreds filed suit in US District Court in the Eastern District of New York over what they believe was Overture affiliate click fraud. Yahoo acquired Overture, formerly known as GoTo, in 2003.
InformationWeek noted the filing of the suit, performed on April 2nd. Yahoo has not responded to the accusation yet.
The court document shows Bigreds believes a lucrative affiliate program run by Overture led to the alleged click fraud. Affiliates earned up to 12 percent commission per click, with Bigreds sometimes paying over $3 per click.
"Affiliates of Overture used software programs, employed people, and/or directed people other than actual consumers to click on plaintiff's links from keyword search results," the suit said.
Only after learning about the existence of click fraud as a problem in the online ad industry did Bigreds seek a refund from Overture. A credit of $17,082.80 was offered for the period of April 28 to June 28, 2006.
Bigreds believes click fraud took over $204,000 of its ad budget during the period. They want that reimbursed, plus the same amount from the unknown people who clicked its ads. The company is also seeking a punitive damage claim of over $614,000.
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Yahoo and click fraud
Yahoo's search engine partner model is wide open to click fraud. I've got a very good example that I've submitted to WebProWorld. It involves a very small engine that generated 50 times more traffic for a specific term than Google. Google 80% market share. The Yahoo partner engines less 0.1% market share. So far I've just had the usual excuses.