|The issue of click fraud became a hot one at the Search Engine Strategies conference at the New York Hilton.
Click fraud occurs when one company sets up an automated system to click on its competitor’s Web ad; each time a click occurs that isn’t from a legitimate customer, the Web site incurs a fee. Others set up fake Web sites as search-engine-network affiliates.
Costing $1 billion a year
Anecdotally, search vendors say fraud represents between 5% and 35% of clicks, depending on the industry, reportedly costing marketers up to $1 billion a year. Lawsuits are increasing, too. The most recent suit on the issue -- CLRB Hanson vs. Google -- was filed last August on behalf of a printing company in Santa Clara Superior Court in California.
The vendors charge that Yahoo and Google severely underestimate fraudulent clicks. And they caution that marketers should carefully monitor their click-through data to highlight potential fraud.
Troubles with tracking
Yahoo and Google have their own tracking and filtering systems set up, and say they refund money to clients when they have detected fraudulent clicks. Both also offer advertisers a way to submit questionable clicks for review and possible reimbursement.
But unless marketer-conversion data is married with search-engine data, an accurate accounting cannot be reached, vendors on the panel charged, and search engines do not have access to marketers’ conversion data. Search engines are saying they will protect their customers, while also saying that don’t have enough data to do so, said Jessie Stricchiola, founder, Alchemist Media, a search-engine marketing and optimization company.
“We’ve seen a pretty consistent downward trend in response to advertiser complaints,” Ms. Stricchiola said. She pointed out that Google changed a notice to advertisers on its Web site last year, from reading that “we detect most invalid clicks” to “our goal is to detect most invalid clicks.”
“I hope everyone knows we take this very seriously,” said Shuman Ghosemajumder, business-product manager, Google. He said that there is no set definition for fraudulent clicks. “People spend millions of dollars in TV advertising, but do they really know those people were sitting there watching that program?”
John Slade, director-product management, Yahoo Search Marketing, said that Yahoo offers free tools to advertisers to help them monitor their clicks effectively. “Our perspective on marrying our data with advertiser data is choice.”
‘Total crap Web sites’
Marketers say sham Web sites, set up for the sole purpose of collecting money by linking to the engines’ networks, present further headaches. “The number of total crap Web sites is ridiculous,” said Greg Boser, president, WebGuerrilla, a search-marketing consultancy. These affiliate partners “don’t convert,” he said. “When we remove all those links from engine partners, our clients’ conversion rate is the same. The affiliate partners just serve to line the [pockets] of the search engines.”
Mr. Ghosemajumder, defending the legitimacy of his network affiliate partners, said about the Google network: “AdSense wouldn’t be so successful if it didn’t work.”
Another problem, the panel said, is transparency. The search engines should be forthcoming about the way they collect click data and how they score it. At present, neither Google nor Yahoo explains to marketers how they determine if clicks are fraudulent. Ms. Stricchiola said that until lawsuits were filed, Yahoo and Google wouldn’t sit on the click-fraud panel. “Litigation is helping to increase communication,” she said.
“We would love to do more [to work with the industry],” Yahoo’s Mr. Slade said. “But a lawsuit says the search engines are conspiring, [and the litigation precludes participation]. We filed our first patent for counting clicks before the turn of the century.”
Google’s Mr. Ghosemajumder denied that participation has anything to do with litigation. “We are here because the entire industry has grown,” he said.