Les Jones

E-commerce > Advertising Click Fraud

Most search engine advertising - such as Google Adwords and Overture - is based on a price per click model. As an advertiser, you don't pay unless someone actually clicks on your ad.

The model depends on visitors being sincerely interested in your product or service. However, because Google, Overture, and most other services have affiliate programs, there's an incentive for affiliates to cheat by faking clicks.

Search engines have basic protections against this sort of thing. For instance, they log the clicker's IP address and weed out repetitive clicks from the same address. They doubtlessly have other protections that they're reluctant to reveal. I've received credits from search engines that determined that clicks against my account were fraudulent, which shows that the problem exists and that they're making efforts to stop it, but it makes me wonder how many fraudulent clicks they didn't catch.

Click fraud has now attracted attention from Newsweek. There's a discussion over at Slashdot. The only advice I have is to stick with the bigger search engines that have more resources to catch this sort of thing, and avoid over-bidding for clicks. The $12 per click ads mentioned in the article are crazy. Assuming a 100 to 1 click-to-sale conversion rate, you'd have to make $1200 per sale to break even on a $12 bid.