Click Fraud It’s Stealing
Joining already thousands of merchants is this woman who thought that she was going to make it big when she had a lot of visits to her Web site by people who clicked small Internet ads which she had purchased from a popular search engine. She believed that the $20 she was spending for each click done was justified by a potential new business. Her happiness died when she found out that those who were clicking on the ads did not care at all about her products.
This woman is a victim of click fraud, a scam which aims at stopping the source of income for search engines and their business partners, the online advertising boom. When someone just repeated clicks an advertiser’s Web link without planning to buy anything, they create traffic that merchants are billed for. This fraud just drained her budget and pointed potential customers to a competitor, making her lose $100,000 in sales, she claims after spending 200 hours to document it.
Click fraud is getting too tough to control nowadays, said the victim who also makes a living selling computer software to doctors. No one is really sure just how much click fraud is going on in the advertising market of search engines. Click fraud is a problem, but it’s making too many people paranoid. Others say that around 10 to 20 percent of clicks made online are done falsely.
We can say that the presence of click fraud is like the presence of an elephant in a living room. Everyone can see it and no one can deny its presence, but no one knows how to handle the situation. The big two among the search engines are very particular with the problems that click fraud brings, but claim that with improved internal controls and an increase in vigilance on the part of advertisers, the problems could be avoided. This scam, though immaterial at the moment, is something that many worry about already. A search engine’s chief financial officer explained to analysts that they were able to put to a stop a particular scheme responsible for making false transactions after including more staff members whose responsibility was to patrol click fraud.
There’s some serious positioning and politicking going on. The industry may not be destroyed by click fraud, but the scam is still remaining. A former employee, she said, formed a rival firm and repeatedly clicked on her ads, and this was the only time she found out that such a problem existed.
Her ads were removed from the display rotation because the clicks that were made were so frequent that it went past the limits of what she wanted to spend. The victim has received payment from the search engine to cover the costs created by the bogus clicks, but it will not be enough, she says, to compensate for missed sales opportunities.
The fact that search engines can’t even trust their own advertising partners was proven in November, when a particular search engine filed a lawsuit. The claims of receiving $50,000 in illegitimate commissions through click fraud were never responded to by this Houston based search engine. The site became inoperative already and so a default judgment against on the principals was won by the search engine. The legal representative of the company claims that this suit is only the beginning of others being done to combat click fraud.
Click fraud would very well exasperate advertisers before long and drive them to file a class action lawsuit against any of the major search engines. Once widely ridiculed, the idea has turned into a fast spreading craze as more merchants realized substantially higher returns on search engine ads than on more traditional marketing campaigns conducted through the yellow pages, direct mail and newspapers.
A prediction has been made by an industry research firm in 2008 that money spent on search engine advertising would reach $7 billion. Because search engine advertising became very successful, prices have gone higher. An industry wide average of $1 dollar was paid by advertisers for the tracking of hundreds keywords by the end of last year.
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