Google's Click Fraud Analysis

Hey guys, just found out that Google has actually been checked up. It's in the Tuzhilin Report. Sorry about not updating. I'm going to try to do it every monday wednesday friday now.




A brief summary (the report is 47 pages) - not including the history of PPC and stuff.
(most of this is quoted/ paraphrased, but I got all this stuff from the Tuzhilin Report)

Some Definitions of Click Fraud:
Wikipedia: "Click fraud occurs in pay per click online advertising when a person, automated script, or computer program imitates a legitamate user of a web browser clicking on an ad, for the purpose of generating an improper charge per click."
Google's def. of invalid: "Clicks ... generated through prohibited means. and intended to artificially increase click ... counts on a publisher [or advertiser -AST] account"

Invalid Clicks can come from the following sources:
1. individuals deploying automated clicking programs or software applications (called bots) specifically desgined to click on ads
2. ad individual employing low-cost workers or incentivizing others to click on the advertising links
3. publishers manually clicking on the ads on their pages
4. publishers manipulating web pages in such a way that user interactions with the web site result in inadvertent clicks
5. publishers subscribing to paid traffic websites that artificially bring extra trafiic to the site, including extra clicking on the ads
6. advertisers manually clicking on the ads of thier competitiors
7. publishers being sabotaged by their competitors or other ill-wishers
8. various trype of unintentional clicks, such a doubleclicks or customers getting ocnfused and unintentionally clicking on the ad without a malicious intent.
9. technical problems, system implementation errors and coordination activities between Google.com and its affiliates resulting in double-counting errors
10. multiple accounts of AdSense publishers: some AdSense publishers illegally open "new" account under different names and using false identities; all the clicks originiated from these illegal accoutns are considered invalid.

Important note: it's impossible to deter with 100% certainty that a click is fraudulent.
There's a big problem with the click fraud detection and the advertisers because without giving out the tests, advertisers won't trust the click fraud detection, and by giving out the tests, the tests and inherently useless because people will learn to bypass them.

Google relies on prevention and detection, ie making it hard to create duplicate accounts,hard to register using fake ids, development of mechanisms that automatically discount fraudulent activities.

The detection tests are simple, so Google relies on:
1. Combination of tests
2. Complexity of few tests.
3. Simplicity of attacks.
4. Long tail of invalid clicks.

Problems with Google tests:
1. lack of deployment of data-mining methods.
2. Using conversion data in filters - hard to use because most don't purchase
3. More advanced filters.

Final note:
The amount of refunds given advertisers is minuscule when compared to the invalid clicks thrown out voluntarily by google.

The Google $90 Million Suit

Probably should clarify something about click fraud that I didn't mention before; Click fraud only happens to ads online that do PPC (Pay-per-click).

A little more on the dangers of click fraud.
Most search engines refuse to release their data on click fraud, for competitive reasons. This lack of information results in only advertisers getting hurt. How long will it be before online advertising starts to go down?

By the way, Google (R) settlement resulted in $30 million attorney fees and $60 million in payments. However, I heard that the $60 million in refunds is refunding by credit for Google's (R) adsense. Does anyone have any information on this?

here's another article by news.com about the settlement:

Google click fraud settlement given go-ahead

Anyone heard of click fraud?

I don't know about you people, but to me click fraud is a growing problem. Not only are big advertising like Google and Yahoo! affected, but the whole economy!

Some basic overview:
The PPC (pay-per-click) is an advertising system where advertisers pay middlemen to put ads up. Often, these middlemen pay others to put ads up. It's an interesting setup. Online advertising is expected to reach 18.9 Billion dollars by 2010 (jupitermedia.com)

So what's up?

Competitors, the "others", and people in it just for income do click fraud. What's that? It's when you click on an ad, maliciously, without intent of viewing the ad or buying the product/service. Companies do it to make their competitors lose a lot of money. Single people do it to get money from the middleman (and through the chain, the advertiser), or are paid to click on other people's ads through hourly wage.

Estimates put click fraud up to 20% of all clicks today (news.com). With a value of 3.2 Billion dollars, that's 640 million dollars this year. By 2010, it'll be 3.78 BILLION Dollars!!

I recently got on it when I heard that many of the major advertising middleman were sued by advertisers for the click fraud problem. Some of you may wonder why the middleman and not the actual fraud people, but it's the middleman's job to make sure that all the clicks charged are for legit hits.


Here's some articles for those interested:

Yahoo! Full Cash Refunds + at least 4.95 litigation

News.com Exposing Click Fraud

Google 90 Million dollar lawsuit