The Wikipedia defines ‘click fraud’ as “a type of Internet crime that occurs in pay per click online advertising when a person, automated script or computer programme imitates a legitimate user of a web browser clicking on an ad, for the purpose of generating a charge per click without having actual interest in the target of the ad's link.’’ It further says click fraud is the subject of some controversy and increasing litigation due to the advertising networks being a key beneficiary of the fraud.
As most Internet advertisers are using Google Adwords for online marketing, the advertising expenditure is entirely dependant on the number of clicks the text ad receives. The amount of each click is determined by a continuous auction of the keywords (the word that is being searched). The highest bidder gets his ad placed on top followed by the rest.
There have been instances of per-click cost of keywords even touching $50 each.
When contacted, a Google spokesperson had this to offer: “Google takes this issue very seriously and has devoted top engineers and significant resources to it. The result is a sophisticated automated system that proactively filters invalid clicks before advertisers are charged and, thus, Google does not realise these clicks as revenue.”
A survey conducted by Sempo (Search Engine Marketing Professionals Organisation) has found that this so-called “network click fraud” affects 78 per cent of advertisers and 59 per cent of agencies. Just over half of all advertisers and 41 per cent of agencies admit that they experienced “competitive click frauds,” where competitors drive up an advertiser’s costs by clicking on an ad multiple times.
Explaining that the advertising cost is charged to advertisers only after they are filtered for ‘invalid clicks’ or ‘click fraud’, the Google spokesperson added, “The percentage of invalid clicks that may escape detection -- and for which advertisers may have been charged and subsequently refunded -- is very small. And that consultants reporting 15 per cent fraud does not equal to 15 per cent of Google revenues, because we are already filtering clicks and not counting the revenue.”
However, Indian advertisers are yet to see this a major threat. Sharing her thoughts on this trend, Makemytrip.com’s Associate VP-Marketing & Alliances, Gayatri Buddha, said, “There has been no high volume click frauds reported for us. There have been minor instances which Google has taken care of proactively and it has been reflected in the financial transactions with them.”
eBay India Marketing Head Rathin Lahiri agreed. “It’s a nascent market with only a few expert practitioners around currently. Therefore, there can be only some incidents of click frauds. eBay has an affiliate programme under which the remuneration is decided on the value of the business the affiliate partner brings in and not a CPC (cost-per-click) model. Hence, we are not really affected by this.”
Elaborating on the methods employed by Google to counter this, the Google spokesperson said, “There are many things we do to detect invalid clicks, including looking at duplicate IP addresses, user session information, network information, geo-targeting and browser information. These are all important signals for detecting invalid clicks. The technology we use to detect invalid clicks is highly sophisticated and was developed by some of the world's leading experts in artificial intelligence, machine learning, and statistics.”
As to some of the efforts taken by Google, the spokesperson said, “We offer free tools to advertisers so that they can monitor their return on investment, which is a helpful way to determine whether too many clicks coming through aren’t resulting in sales. Those free tools help advertisers manage a bottomline value of their ads.”
Buddha also agrees with Google. She said, “We have been forewarned by Google about this activity, so we are prepared to face it.” Lahiri added, “Any sort of advertising has some amount of wastage. As the amount is highly negligible, it’s fine with us.”
At present this phenomenon is not being considered a major threat in the country, but only time will tell how this issue impacts Internet advertising in India.