Battling Click Fraud

By Frank Watson

Seems everyone sees the presence of click fraud, but we're just disagreeing about the numbers.

Click Forensics published its numbers for click fraud during Q4 2008 and it appears the fraud numbers are climbing. They found that:

* The overall industry average click fraud rate grew to 17.1 percent for Q4 2008. That's up from 16.0 percent in Q3 2008 and from 16.6 percent reported for Q4 2007.
* The average click fraud rate of PPC advertisements appearing on search engine content networks, including Google AdSense and the Yahoo Publisher Network, was 28.2 percent. That's up from 27.1 percent reported for Q3 2008 and down slightly from 28.3 percent reported for Q4 2007.
* Traffic from botnets was responsible for 31.4 percent of all click fraud traffic in Q4 2008. That's up from 27.6 percent reported for Q3 2008 and 22.0 percent reported for Q4 2007.
* In Q4 2008, the greatest percentage of click fraud originating from countries outside the U.S. came from Canada (7.4 percent), Germany (3.0 percent) and China (2.3 percent).

Interestingly, Google quickly protested the numbers. Shuman Ghosemajumder, a well-known Google employee in the analytics area, has previously challenged the validity of Click Forensics' numbers in a personal blog. Well, I've been involved with the Click Quality Council and know the people at Click Forensics, and I have to think Google doesn't want to admit to click fraud.

The official AdWords blog suggests there is only .02 percent click fraud. Yeah, OK. But Shuman admits higher numbers when he states the numbers are inflated by 40 percent. That still leaves double-digit fraud, and not the double decimal place number pushed by the largest seller of clicks in the search space.

Shuman offers plenty of reasons for the inaccuracy: they don't count right, so numbers are inflated; they're counting wrong things, in the wrong places; and content is the largest place for click fraud.

This situation needs to be addressed. We hope that the search industry will do well in this poor economy, given its ability to measure ROI. If higher numbers of fraud are being published, maybe the change will take longer. People need to know that click fraud increases the cost of conversion. But so long as the CPA is acceptable, fighting it is just a way to make search even more profitable.

We need to understand click fraud exists and that it may have a bigger impact than Google suggests. Proactive actions, such as filtering and offline analysis, are definitely needed, and reactive investigations should be always done.

There's a market for people who analyze and argue to get money back for fraud and other issues from Google. Given the number Google suggests is that off, there's good money to be made in the double-digit discrepancy.

Shuman seems to use some conflicting logic to attack the click fraud industry:

Click fraud protection is something we take very seriously at Google, and it requires a high level of scientific rigor to do well. It's frustrating to see basic mistakes being made by firms selling "additional protection" to AdWords advertisers - in essence, charging them money for advice which can actually hurt their businesses.

I've spoken with many firms and a number of academics interested in this area, and the ones who are investing in serious R&D efforts recognize the limitations of their data and analysis and have not been focusing on publicizing unsupportable and flawed numbers such as the above. We're very supportive of those efforts (and in scientific research in this area in general) and we'll continue to work closely with them.

Google isn't alone in taking this situation seriously, and they're also not the only people able to bring the high level of scientific rigor to their examination. To suggest that people who monitor click fraud -- an added protection -- are deceptive by charging money is flawed. Google makes its money on the other end, and people are employed in the space, so they just write that expense against what is charged the advertisers.

I'd also like to know who are "the many" and how much is "a number." The "publicizing unsupportable and flawed numbers" comment is also questionable. The numbers are gathered and collated; obviously, they aren't as all-encompassing as Google's. But they're legitimately counted.

Google has a responsibility to be more transparent. The legal problems aren't likely to go away any time soon, and Google has to learn they aren't the final say -- they're a contributor to the conversation. As AdWords customers, people have the right to go to someone other than the Ad Quality Team.

Chris Boggs Fires Back

Search engines versus fraudsters is a long-raging battle. Click Forensics and Google is an interesting side story. Perhaps still the best panel I've ever attended at Search Engine Strategies pitted Tom vs. Shuman, perhaps the original "Rocky," to some who have followed this pertinent saga between Google and click fraud perps.

This situation is more like the "Terminator" series. Is Google, the largest and most important search engine, Skynet in this battle? Much like the series, the resistance (fraudsters) uses technology against its own inventor to a clip of over 30 percent. That's some serious firepower.

To many, Click Forensics and the Click Quality Council are a noble group of knights waging battle for transparency against the in-your-face "our-technology-works-and-your-basic-math-is-faulty" perspective that Google pushed out in the beginning and now seems to be angling toward again. The war definitely cooled for a while between Click Forensics and Google, as far as SES goes. The sessions lost a lot of pep.

It was refreshing to see Reggie Davis of Yahoo become the most Click Forensics-aligned "we'll work together" figure, however. They've painted themselves a little less evil in this story (again based on attending this topic's panel at SES over the years).

I respect Tom and other friends at Click Forensics and on the council. Using technology is the only way to ensure that advertisers have true protection from fraud.

The real step that needs to be taken is for Shuman and Tom to kiss and hug, and join forces against the "resistance," which isn't as romantic as it sounds. Fraud costs everyone.

The analytics and business intelligence being performed by top advertisers is a hedge, and the prevailing undetected fraud rate is probably closer to Google numbers for organizations able to better protect themselves. Remember also that many advertisers are willing to give up a small percentage of "shrinkage."

This battle won't be over any time soon. Hopefully the relationship between Click Forensics and Google warms to a serious affair sooner than later in order to save advertisers sooner than later.

Local Search Tactics for Tough Economic Times

From Gregg Stewart, Search Engine Watch

In tough economic times, small business owners tend to be better at targeting their marketing and advertising expenditures to tangible sales results more so than the large brands. Size and scale of their trading area and local market expertise certainly plays an important role. However, small business owners skillfully micromanage budgets and are able to match dollars to opportunities better than their fortune 500 CMO brethren.
What tactics and best practices can we glean to improve our local search campaigns in these challenging times of credit crunching and receding sales opportunities? Before we get there, you should ask:
• On a high level, how are your expenditures allocated?
• What percentage supports branding, promotional and direct response?
Allocating Expenditures
Small businesses tend to allocate their promotional dollars more heavily toward direct response and directional marketing, as branding is usually of secondary consideration. If you envision a sales funnel, these folks appear right at the purchase decision. It's a lot easier to grab consumers who are in the "where do I buy" mode, rather than the "what do I buy" mode (which is harder to convert, as it is higher up on the sales funnel).
Branding/Direct Response Mix
OK, before you hit the comment button to ask if you should stop spending on branding, the answer is no. I only ask you to consider the priority of your spending based on the ability of that spend to produce a sales conversion.
Marketers should be able to scale back their brand awareness investments with little to no impact to their overall business, allowing marketing efforts to focus more around ensuring you're the one chosen when that question of "where to buy" arises.
To yield these "bottom of the funnel" consumers, it's all about being in the right place at the right time. Local search, and the arsenal of tools associated with local online marketing, can help deliver these prospects and customers.
In looking back through all my Search Engine Watch articles, I realized it might be helpful to organize the topics into a checklist of tactics in order of priority to help your firm weather today's economic environment:
• Local Listing Management: Google Maps, Yahoo Local, and thousands of other sites utilize local directory listing information to direct searchers to physical brick-and-mortar locations. Because of the nature of how this information is captured and updated, it's important for businesses to proof the listing information (name, address, phone number) to ensure accuracy.
• Internet Yellow Pages: With highly desirable conversion rates, advertisers want to ensure Internet yellow pages (IYP) are maximized from a sales lead generation standpoint. Unlike other media sources, IYP users don't scour these resources for rich robust content. Instead, they seek location information and telephone numbers because they're at the moment of purchase.
• Local SEM: A correctly executed SEM program will yield highly desirable sales leads at a very efficient cost. For national or regional advertiser looking to incorporate local SEM into your mix, check out this local search "how to" guide. Local search, and search in general, suffers from one problem: it may be too efficient and provide advertisers with such a desirable ROI that we grow complacent. Make sure you review your landing pages and employ landing page optimization techniques to maximize sales conversion from your SEM leads.
• Local SEO: Local SEO is a vital marketing strategy for businesses that sell products locally to a specified geographical area. The goal of local SEO is to increase your listing position to the top of the natural or organic search page results. Sounds easy, but it's complicated and requires a steady progression of work to get (and stay) on top. "Getting to Know Local SEO" can get you started.
• Mobile/Directory Assistance: The free directory assistance area has grown rapidly since I wrote about it in "Voice Search: Mobile Tactic Here. Now. 2DAY." Several new advertising supported offerings have emerged as this segment has developed.
Our advertising and marketing efforts must be cost efficient and convert to desirable sales. In today's atmosphere, it's important to question everything. Make sure you measure and validate to ensure historic media efforts continue to deliver meaningful ROI from the investment allocated.
Taking a "business as usual" approach probably won't deliver the magnitude of sales leads necessary to survive and prosper in this tough economic environment. If you have expenditures that you can't value through measurement of actual business created, then reallocate those funds to media types that can provide you with proven results. Remember, that which can be measured can be optimized.

Google Image Search Text Ads assumes the reins of goverment

Google announced that it would begin experimenting with display ads on Image Search on August 2008. Until recently, after servral month's test, this services had been brought out from the laboratory. In 2006 the company estimated that it was missing $200 million a year because the ads was not included into image search results. It was said that Google has previously tried to incorporate text ads into results, but abandoned the practice after seeing a marked decline in traffic(From techcrunch.com). Anyway, it appear again and hopefully the traffic will not drop this time. Different with the Ads that was found by other internet surfer(image shown below),

the Ads shown now are purely written in text just like the Ads shown on web search results.

We can't doubt that there will be more and more useful or no-use ads shown on Google image search results soon.