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Airline company's latest PPC program flies past click fraud

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Nate McKelvey, CEO of private charter plane company Jets International, was engaging in pay-per-click advertising before anyone knew what to call it. By 2000, the Quincy, Mass.-based executive was buying keywords on Goto.com and Yahoo, and soon after added Google.com to his advertising mix. In the beginning, McKelvey said, he was buying keywords for "a cent or two each," and seeing ROI that boosted his revenue from $1.2 million in 2001 to $6.7 million in 2002.

"The jump was primarily because of search advertising," McKelvey said. "It was just amazing."

But in the following year—2003—a perfect storm gathered, affecting his ROI significantly. More of Jets International's competitors got involved in the PPC advertising world, causing keyword costs to spike up to $20 per click. At the same time, McKelvey's conversion rate started tanking. Soon after, he had a revelation.

"I was talking to a friend in the business and he was saying he got 3,000 clicks from one IP address. I asked him to give me the IP address, and sure enough, although I didn't have 3,000 clicks from it, I had several hundred," McKelvey said. "I looked over my logs and the clicks went back at least a year."

He did a little more research and discovered that the IP address originated from another competitor's server. That made him even more suspicious, so he started pouring over his logs. He didn't like what he found. More than 10% of his clicks were coming from the Netherlands, a country in which he doesn't have customers. He found other suspicious clicks, too. He reported his competitor's activities to Google and Yahoo, but they did not ban the company (they did refund a small portion of what he believes was fraudulent activity). Since McKelvey wasn't getting the response he wanted, he immediately slashed his paid search budget from $20,000 per month to $1,500, he said.

Since then, PPC advertising has taken a backseat. But this summer, McKelvey was approached by search company ClickFacts' CEO Michael Caruso, who told him that he could help boost ROI by analyzing Jet International's search traffic and blocking individual IP addresses and specific sites on Google's AdWords content network.

Within the first month, ClickFacts was able to uncover "quite a bit" of invalid clicks, McKelvey said. Since he knows what sites aren't converting, McKelvey has been able to block numerous sites on Google's content network, and his conversion rate has gone up by 500%. As a result, he's raising his spending again.

"I'm still not spending as much as I was. I'm up to $4,500 per month," he said. "I wish the search engines could clean up the content networks more, though. If they could bring back the original ROI I used to see it would be amazing."

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