PPC Advertising (Pay Per Click)

   Pay per click advertising or PPC advertising is when webmasters
(operators of web sites), acting as publishers, display clickable links from
advertisers, in exchange for a charge per click. The two main players in the
PPC industry is Yahoo and Google Adwords. Each time a (believed to be)
valid web user clicks on an ad, the advertiser pays the advertising network,
who in turn pays the publisher a share of this money.

However, a pressing issue that affects PPC advertisers and publishers is
clickfraud, which is the primary focus of this article.

Click fraud occurs in pay per click online advertising when a person,
automated script or computer program imitates a legitimate user of a web
browser clicking on an ad, for the purpose of generating an improper charge
per click.

Click fraud can be as simple as one person starting a small web site,
becoming a publisher of ads, and clicking on those ads to generate
revenue. Often, the number of clicks, and their value, is so small, that the
fraud goes undetected. Often publishers will claim small amounts of such
clicking is an accident, which is often the case. But over time those clicks
add up.

Much larger scale fraud also occurs. Those engaged in large scale fraud will
often run scripts, which simulate a human clicking on ads in web pages.
However, huge numbers of clicks appearing to come from just one, or a
small number, of computers, or single geographic area, look highly
suspicious to the advertising network and advertisers. Clicks coming from a
computer known to be that of a publisher, also look suspicious to those
watching for click fraud. A person attempting large scale fraud, alone in their
home, stands a good chance of being caught.

Organized crime can handle this by having many computers, with their own
internet connection, in different geographic locations. Often scripts fail to
mimic true human behaviour, so organized crime networks may employ
people to do it manually. Often they pay workers in low-wage-countries such
as China and India to sit and click on ads.

Impression fraud is an insidious variant of click fraud where the advertiser is
penalized for having an unacceptably low click-through rate for a given
keyword. This involves making numerous searches for a keyword but
without clicking of the ad. Such keywords are disabled automatically,
enabling a competitor's lower-bid ad for the same keyword to continue while
several high bidders (on the first page of the search results) have been
eliminated.

It's very difficult for advertisers, advertising networks, and authorities to
pursue cases against networks of people spread around multiple countries.
But prosecuting someone click fraud is difficult in general since very few
prosecutors or judges know about click fraud. Fortunately, click fraud is rare,
but it is more common with competitive high traffic keywords.

Proving and stopping click fraud can be very difficult, since it's hard to know
who is behind a computer and what their intentions are. Often, the best an
advertising network can do is to identify which clicks are most likely
fraudulent, and not charge the account of the advertiser. This is often done
with complex algorithms that can filter suspect clicks.

Related Topics:
Internet Affiliate Marketing
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