Google AdWords is a powerful marketing tool that can significantly enhance web traffic to a vendor’s website and dramatically boost revenue. Unfortunately, Google AdWords campaigns are often vulnerable to abuse. This exploitation of AdWords—click fraud—occurs when a person(s) or automated computer scripts (bots) impersonate a legitimate user and effect multiple, insincere clicks on advertisements. This creates an inflated click-through-rate (or CTR) and can severely limit the number of genuine clicks from potential customers, even down to zero. Sometimes the culprit is a third-party ad host website, trying vicariously to boost revenue. However, more often than not, click fraud is the work of competitors, attempting to drive up an advertiser’s marketing expenses. The final result is that Cost-per-click (refered to as CPC) increases while conversion rates plummet. Campaigns can also be forced offline by maxing out budgets. Even if it’s temporary, that’s a lost chance to reach your target audience.
Click Fraud and Google
While Google does police AdWords campaigns, it is also highly secretive about how it goes about it. Over the past decade, there have been a number of high profile lawsuits filed against Google (as well as other search engines) citing overall negligence in protecting advertisers’ interests. The ongoing saga of these struggles highlights the acknowledged inadequacy of internal monitoring, as well as strong preference on the part of Google to settle, rather than reveal anything about their internal algorithms.
Back in 2005, three lawyers from Texas, Dean Gresham, Joel Fineberg, and Stephen Malouf, launched a (now defunct) website to seek out plaintiffs and evidence against Google and other major search engines. This coalesced into a significant class action suit against Google and other major search engines, primarily on behalf of the primary plaintiff: The Lane’s GIfts. The suit, filed in an Arkansas court, accused the defendants of overcharging advertisers for pay per click advertising, as well as attempting to conceal these overcharges. Their website, LostClicks.com, was to serve as an online platform to meet advertisers facing problems with adwords and people concerned and affected by this fraud.
Shortly afterwards, Click Defense filed a lawsuit against Google in the U.S. District Court in San Jose. The suit claimed that Google was significantly overcharging advertisers for the keywords it sells, without adequately publicizing the existence and effect of click fraud, or providing compensation for losses or additional expenses incurred. Fundamental to the suit was the assertion that “Google has an inherent conflict of interest in preventing click fraud” given that Google’s own earnings are unaffected by it.
The end result was a $90 Million dollar settlement, in which Google committed to reimbursing victims of click fraud. (http://www.cbsnews.com/news/google-settles-fraud-case-for-90m/)
Of note here, is that Google preferred to settle, rather than have its specific detection methods for click fraud revealed. Also, this money was not a payout, but simply credit to the accounts of advertisers who were defrauded. It would be interesting to see how Google would respond, were it to be potentially liable for actual costs.
As part of the settlement, the court ordered a third party commission to study the issue of click fraud further. The result was the research and findings reported by Dr. Tuzhilin, a computer scientist at NYU. (https://googleblog.blogspot.co.il/pdf/Tuzhilin_Report.pdf). The report concludes that while Google benefited from advertisers’ losses, and waited too long to respond (page 30), the current measures to prevent click fraud are, to some extent, apparently reasonable. However, this “reasonability” is reported as highly tentative, as the report asserts that there is still a number of weaknesses (listed pg.34-35). In Dr. Tuzhilin’s words:
[Regarding the claim that] Google’s invalid click detection methods “work well” and remove “most” of the invalid clicks – the provided evidence is simply not hard enough for me, and I am used to dealing with much more conclusive evidence in my scientific work…. measures [provided by Google] are only statistical measures providing some evidence that Google’s filters work reasonably well. This does not mean, however, that any particular advertiser cannot be hurt badly by fraudulent attacks, given the evidence that Google filters “work.” (pg.43-44)
Dr. Tuzhilin asserts that while we cannot generalize based on the fact of these advertisers being hurt, it is only due to lack of evidence, not a mitigating protection offered by Google.
Some tech bloggers accept the reasonableness of Google’s measures on face value and conclude that click fraud is now rare (despite there being no evidence to support that claim and significant evidence to the contrary.) The basic sentiment is that “If the clicks sell enough to justify their cost, the channel still works.” (http://www.rimmkaufman.com/blog/comments-on-the-lanes-gifts-v-google-report-by-alexander-tuzhilin/06082006/)
We find this to be a pretty callous attitude towards the losses that click fraud brings to advertisers. It’s a sad state of affairs when malicious activity is simply the “cost of doing business”.
The most obvious demonstration that click fraud exists, and gets past Google’s filters, is that they (and others) have a method of claiming for reimbursed credit for clickfraud after the fact. (http://www.searchmarketingstandard.com/getting-your-click-fraud-refund). Naturally, this requires the advertiser to “become a detective”, which means taking the time to sit down, analyze the data, collect evidence, and submit for review.
There is a Better Way
The alternative to having to police your own campaign and file for credit from Google, is using third party software. However, not all software is created equal. Some are premium services that cost tens of thousands of dollars per year, and are suitable only for the large corporate clients who can afford them. For small to medium sized advertisers, your best option is ClickFrauds.com.
There are other third-party services aimed at this demographic, but they typically work by comparing IP addresses and notifying you via email. ClickFrauds.com goes way way past such basic measures. Using proprietary machine-learning algorithms, the ClickFrauds system gathers and analyses a diverse set of data including device type, geo-location, browser, click patterns, and more. The system continues to learn and fine tune its exclusions based on sophisticated analysis of the data it collects. A graded system for assigning risk allows for an unprecedented level of predictive power in preventing click fraud. In this way, you have the freedom to focus on your work, not agonize over your AdWord accounts. To learn more about this product, .