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Click Fraud

Click Fraud

Click Fraud: Understanding the Danger

PPC advertising is a legitimate, cost-effective way to drive targeted traffic to a site. It can be profitable for merchants, but it can also be tempting for scammers. The “Judy” malware discovered earlier this year, for example, made millions for its creators by simulating clicks on Google ads. The virus was hidden in popular apps, and cyber security experts estimate it may have infected over 35 million Android devices.

Click fraud costs marketers billions of dollars every year, and the risk continues to grow. Despite increasing danger, however, merchants don’t have to be victims. Combining the right information and due diligence can mitigate risk and safeguard long-term profitability.

In this post, we provide an overview of click fraud and outline some of the ways you can safeguard yourself and your business.

What is Click Fraud?

click fraud

[noun]/* klik frawd /

when a third party deliberately clicks on an advertising link—a banner ad, for example—with no intention of doing business with the advertiser. It can happen with any sponsored ad or link, but it’s most prevalent (and most damaging) when done through affiliate marketing.

click fraud

[noun]/* klik frawd /

when a third party deliberately clicks on an advertising link—a banner ad, for example—with no intention of doing business with the advertiser. It can happen with any sponsored ad or link, but it’s most prevalent (and most damaging) when done through affiliate marketing.

click fraud

[noun]/* klik frawd /

when a third party deliberately clicks on an advertising link—a banner ad, for example—with no intention of doing business with the advertiser. It can happen with any sponsored ad or link, but it’s most prevalent (and most damaging) when done through affiliate marketing.

Click fraud wastes advertisers’ money and distorts targeting data. It also drives up online advertising costs, causing ongoing damage to the industry.

Fraudulent clicks fall into two categories: manual and automated. The former involves human beings clicking a link, while automatic click fraud employs automated tools to work on a larger scale.

Types of Manual Click Fraud

Manual fraud tends to be more limited in scope because it requires warm bodies to click the ads. Manual click fraud is also harder to prove, as a human being can always say the click was accidental.

So who are the human beings doing this clicking?

Rivals

When competitors click your link, they know you’ll have to pay and get nothing in return. For a small business, even one competitor hitting your link daily can blow your budget.

There are safeguards in place that keep it from being quite that easy. A more likely scenario would be a rival with a network of friends or employees. Each person in the network hits the same link at different times or from different devices.

Affiliates

Placement services such as Google’s AdSense match advertisers with established sites based on shared interests and demographics. You supply a banner ad or a text hyperlink to the placement service, and the service displays it on a comparable host site, or affiliate. If a visitor clicks on your ad, the affiliate gets paid.

It’s easy money for the affiliate, but the system can be abused, too.

For example, affiliates may click on ads themselves here and there. Or like the rival mentioned above, affiliates might have employees, friends or family members clicking for them. The result is the same: more revenue for the affiliate at your expense.

Friends

Not all click fraud is malicious. For example, if your mom wants to brag about your success, she may tell everyone in her gardening club to Google your company and click on your ad. Or you may have customers who can never remember your web address, so they do a search and click on the ad every time.

It's all innocent and well-meaning, but it’s still costing you money. Plus, you're corrupting your customer marketing data with each unnecessary click.

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Types of Automated Click Fraud

While manual click fraud can hurt, automated fraudsters do the real damage. These are almost always affiliates trying to generate traffic through fake clicks. “Automated,” in this case, can refer to anything that streamlines or accelerates the process, including:

Bots

An internet robot, or bot, is a device or a program that performs routine online tasks with minimal human support. Bots can mimic human actions, like generating a (fake) user click.

Fraudsters can create "botnets" by infecting thousands of unsuspecting devices with malware. Code is placed in each operating system without the device owner’s knowledge. This allows the fraudster to passively use those computers to produce fraudulent clicks.

Hit Inflation

Affiliates sometimes ask users for help; they entice users to click ad links to “support the channel” and help finance future content. It seems benign, so customers click on ads to other sites. They do the affiliate a favor, but do the advertisers a disservice.

A similar but more aggressive technique forces users to unknowingly click on ad links. Programming hidden in a legitimate link bounces the user to an ad page, then immediately on to a content page. The user being on the ad page even for a second can count as a click. But since the "ad page" can be as small as a single pixel, the user is unaware anything shady happened.

This practice is known as hit inflation. Like all click fraud, it’s used to artificially inflate the number of visitors coming to an advertiser’s site through the affiliate link.

Click Farms

Click farms are an interesting hybrid of manual and automatic fraud. Large teams of human workers are hired, typically in developing nations where labor costs are low. These teams manually click on links using different devices to boost click figures.

What makes the process “automated” is the assembly-line approach. Workers are in one dedicated location and may have as many as 50 or more devices (smart phones or tablets) within reach.

As an advertiser, you think you’re getting hits from many users, but they could all be generated by a single person. The clicks come from humans, but the humans are essentially performing the same function as a botnet.


How Can I Protect Myself from Click Fraud?

While click fraud is rampant, determining a firm figure for the number of attacks is almost impossible. Experts predict that as much as 50% of all advertising clicks are fraudulent.

But don’t let those frightening statistics scare you away from PPC advertising altogether. PPC is still an effective resource, and can be very profitable if you safeguard yourself.

As with other forms of fraud, your best strategy is to pay attention. PPC advertising is an important part of a comprehensive online marketing strategy, so establish goals and keep a close eye on your campaigns.

Don’t judge the effectiveness of your online investment by clicks alone: test everything. Sales and conversion figures are a better indicator of success. Whatever you do, make sure the system works for you.

If you suspect you’re the victim of affiliate fraud, talk to the experts.

At Chargebacks911, we use proprietary technologies and personalized analysis to identify and prevent affiliate fraud.

Contact us today for more information.


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