How to Avoid PPC Scams

When we talk about PPC Scams we are referring to technology companies that charge for Pay Per Click (PPC) without giving you detailed information about where your marketing dollars are going. Unfortunately, this has become a very common practice. We are not sure whether it is due to the fact that customers don't have a general idea of how it all works, or if its because PPC Advertising is still relatively new (to most people) and is not regulated. Probably a combination of both..

Here is what you want to watch out for:

Set Rates: This is the biggest money maker for Internet marketing companies. They give you a set rate (I.e. - $500 per/month) for your PPC campaigns. Some will tell you that they are spending "X" dollars on the PPC and rest on the management fee. How do you know it's true? Others will even take it a step further and give you no information.

No Statistic Reporting: You hire a business to manage your Internet Advertising. They do it for a period of time and give you no indication of whether it is working. You don't know how much your clicks cost, how many clicks your getting, what geographical locations are being served, etc. The only checkup you can do is to perform a Google Search of your keywords and hope to see your ad.

Contracts: Most Internet marketing companies want you to sign a 12 month (or more) contract for their services. This locks you into Internet marketing [with them] for a year! What if your not getting your ROI? What if they're not doing a good job? What if anything?

All three of the items above are suggesting one thing; you will not know what is going on with your Internet marketing if you do not choose the right company.

In order to avoid the scams above (and many others), we recommend that you use Asset Technology's Internet Marketing Services. Our Internet marketing approach is like no other on the net and shows why we are becoming the leader in PPC Management Services. Here is our program and how it works:

Contracts: NONE
Cost: $89 per / month + $200 Setup Fee
Statistics: Monthly Reports

How it works:

Our Internet Marketing Specialists first look at your website to determine strategy of landing pages, content, etc. We then create professional campaigns through Google AdWords that cater to the needs of your potential customer. After determining keywords, cost per click, number of campaigns, etc., we recommend a monthly budget for your Internet Advertising. You (the client) then determine if you want to raise/lower that budget on a monthly basis when we provide our Statistic Reports. You are in complete control.

Example: You budget $250 per month on your clicks (that are billed directly to you from Google), you will then receive a monthly invoice of $89 for our management fee. You will also receive monthly reports that show statistics like visitors that month, avg. time on site, conversion [sales] rate, geographical location of where your clicks came from, avg. amount of pages they viewed on your site, etc, etc, etc. These statistics not only show you the that our marketing works, but will also give you detailed information on how to cater to your customer via your website.

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Report: Click Fraud At Record High

Report: Click Fraud At Record High

17.1% of all clickthroughs on web advertising are the result of click fraud - the act of clicking on a web ad to artificially increase its click-through rate - according to the latest report from Click Forensics, a company that specializes in monitoring and preventing internet crime. The level of clickfraud is the highest the company has seen since it started monitoring for it in 2006, dashing our hopes that it might hold steady in 2008. The company recorded a rate of 16.3% in Q1 2008.

Also alarming is the fact that over 30% of click fraud is now coming from automated bots - a 14% increase from last quarter and the highest rate Click Forensics has seen since it started collecting data. Click fraud for ads on content networks like Google AdSense and Yahoo Publisher Network was up to 28.2% from 27.1% last quarter, though that figure has decreased since Q4 2007, when it was at 28.3%. Outside of the US, Click Forensics reports that the most click fraud came from Canada (which contributed 7.4%), Germany (3%), and China (2.3%).

Click Forensics also notes that it has seen a reemergence with some old-hat tricks, like link farms. The company speculates that the increase may be tied to the poor economy, which has spurred a rise in activity like phishing and other cybercrime.




Website: clickforensics.com
Location: Austin, Texas, United States
Funding: $15M


Click Forensics offers auditing services to both advertisers and Web publishers who want to keep tabs on how many clicks on their ads are fraudulent.

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The Growth of Click Fraud

Pay-Per-Click Search Engine Marketing Excerpt Part 2
By: Boris Mordkovich and Eugene Mordkovich


Excessive clicking on links to websites and forms of online advertising not tied to a cost-per-click payment is nothing new to the online community. Ever since the beginning of the Internet as a commercial enterprise, excessive clicking on search engine listings was used to create a sense of “popularity” of the website. which often led to improved rankings on the search engine (Stefanie Olsen, “Exposing Click Fraud”).

It is partly because of this early type of questionable clicking that search engines began to explore different methods of ranking websites, leading eventually to today’s reliance on complex algorithms, robot crawls, the infamous Google Dance, relevancy ratings, related links, content, popularity, and so on.

Repeated clicking on pay-per-click advertising is not a recent development, but it has become a major problem for all parties involved.

This phenomenon, now referred to as “click fraud,” has been a part of the Internet for quite some time. One of the earliest successful strikes against this type of fraud was conducted by Jessie C. Stricchiola, President of Alchemist Media, Inc., who identified and successfully procured a refund on behalf of the national corporation Chase Law Group against Goto.com (now Yahoo! Search Marketing) late in the year 2001.

It wasn’t until later in 2002, however, that many companies began to discuss the issue in online articles and forums. One of the main problems with combating click fraud seemed to be that there were so many different interests involved.

Or course, advertisers were concerned that their ad dollars were being wasted. Yet, if they were also affiliates, they saw the potential of making back some of their own click fraud losses by practicing click fraud themselves.

Search engines were interested in maximizing ad revenues (which click fraud accomplished for them), yet realized that if they didn’t help control click fraud, eventually they would lose those very advertisers and their ad revenue.

In addition, some people who were involved in click fraud didn’t understand that what they were doing was wrong. This was particularly true if they were not very computer literate or had themselves been a victim of click fraud. In some cases, they had even been told they were helping the very people whose ad dollars they were depleting, because clicking on their ads increased the popularity of the website.

However, click fraud didn’t really become a huge problem until pay-per-click advertising became more prevalent. Logic dictates that if there is nothing to practice click fraud upon, it is unlikely to be a large problem. Unfortunately, the increased popularity of pay-per-click advertising has concurrently revived the practice of fraudulently clicking on paid advertising.

Although many suspected fraudulent clicks were depleting their ad accounts, it wasn’t until a few landmark cases came to light that the online advertising industry began to react to the growing problem.

Estimates of the extent of the problem today vary widely, and this is a subject of much discussion among advertisers and PPC search engines. Estimates range from a low of 10% to as much as 50% of clicks falling into the fraudulent category. The search engines usually claim that, although it is a significant problem, it falls toward the lower percentage. Developers of tools and software to counteract click fraud, however, lean toward the higher figure.

However, everyone does agree that click fraud has been a problem in the past and that it is becoming an even greater problem now. Left to flourish on its own, click fraud ultimately could bring the entire pay-per-click industry grinding to a halt, with advertisers losing enough money on their ad campaigns to drop their ROIs to negative numbers. This, in turn, could lead them to withdraw from this type of advertising altogether.

The domino effect from such a retreat could have a massive effect on search engines in general, most of which now rely on paid advertising as a prime source of income for growth in the marketplace. Both sides have a great stake in controlling and ultimately bringing click fraud statistics down to the lowest possible percentage.

As long as there are people willing to commit fraud, however, click fraud will never be completely eliminated. Advertisers and search engines agree, however, that the issue needs to be addressed now, before it gets completely out of hand.

Probably the most infamous and audacious click-fraud case, which caught the attention of the industry and alerted them to the potential danger of click fraud, involved an individual named Michael Anthony Bradley. Mr. Bradley developed a software program that he called “Google Clique.” He claimed that the program allowed clicking on pay-per-click ads in such as way as to be virtually undetectable to search engines.

Bradley told Google that if they were not interested in purchasing his software at a reported price of $100,000, he would send copies of it to at least 100 spammers worldwide. This would result in fraud in the neighborhood of at least $5 million in the course of six months. Bradley was charged with extortion and wire fraud in March of 2004.

Later in the year, another significant lawsuit brought to the forefront another type of click fraud, this time involving affiliates. On November 15, 2004, Google sued one of the advertisers on its AdSense program (which involves websites including a PPC ad on their site in return for a portion of the income earned by Google when someone clicks on that ad).

The lawsuit claimed that Auctions Expert International, a Houston, Texas-based company, “ flagrantly abused (Google) by artificially and/or fraudulently generating ad clicks…. These clicks were worthless to advertisers, but generated significant and unjust revenue for defendants.” Key to the lawsuit was the claim by Google that the site itself was set up specifically for the purpose of click fraud and was never intended to be a legitimate auction website.

Experts in click fraud are of two minds concerning these two significant cases. One side believes that businesses need to accept the fact that a certain amount of click fraud is inevitable, just as offline businesses accept the fact that they will be subject to a certain percentage of loss due to shoplifting and other means.

Those who adhere to this view generally believe that the search engines are doing all they can to identify the culprits and rectify the situation via refunds to their advertisers. They also believe that advertisers need to consider click fraud part of the cost of doing business online and that they should take whatever steps are possible to detect it (more on this later in the chapter).

Other experts, most notably Jessie Stricchiola from Alchemist Media, who is one of the earliest analysts to identify and deal with click fraud issues in paid advertising, see the problem slightly differently. They tend to view the public actions by Google against click fraud activities as a means of deflecting advertisers’ concerns. To these analysts, search engines appear to be either unable or unwilling to commit the resources needed to combat click fraud. Instead, they place the onus on the advertiser to detect and report it; then the advertiser must rely on the search engine’s judgment as to whether or not the incident is true click fraud, or not.

As for the search engines, many have begun to institute click fraud detection programs. Google itself claims that both the Bradley case and the Auctions International lawsuit show that Google is sending a warning to all who participate in click fraud that they “…have sophisticated technology that detects and eliminates fraud…. This lawsuit … demonstrates the success of our antifraud system and that we will take legal action when appropriate.” (Steve Langdon, Google spokesperson.)

These high-profile legal cases are, however, just the tip of the iceberg in terms of click fraud in general.

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Click Fraud and How to Counteract It in Ad Campaigns

Pay-Per-Click Search Engine Marketing Excerpt Part 1
By: Boris Mordkovich and Eugene Mordkovich

Unfortunately for any advertiser or businessperson, whether they are online or offline, fraud is a component they must all deal with, in one form or another. With offline businesses, it’s usually in the form of shoplifting or mysteriously disappearing inventory. With online business, however, the fastest-growing type of fraud concerns a phenomenon called “click fraud.”

On its most basic level, click fraud is defined as any click that is maliciously made on an advertiser’s PPC ad with the intent of depleting the amount of money in the advertiser’s account.

As a simple example, let’s assume you have a pay-per-click ad set up on Google and your keyword bid is $1 per visitor. Therefore, each time someone clicks on your ad on the results page for that specific keyword, your account is charged $1. If the amount of money in your account equals $1,000, then you can have 1,000 clicks on your ad before your account is depleted of funds.

If someone decides to target your ad via click fraud, they can use various methods to arrange to have your ad clicked on repeatedly until your $1,000 is gone. This can occur within a matter or minutes, or over a number of days or weeks, depending on what method is used and how blatant the fraudsters are about the process.

Obviously, this is an incredibly destructive type of fraud, especially since it occurs online, where many people feel they are acting anonymously. Some click fraud campaigns do not even try to hide their location or identity if they make a lightning attack on your ad; instead they wait and change their online “identity” after they had made a significant dent in your account, if not having drained it altogether.

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Click Fraud is a Internet crime

Click fraud is a type of Internet crime that 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 a charge per click without having actual interest in the target of the ad's link. Click fraud is the subject of some controversy and increasing litigation due to the advertising networks being a key beneficiary of the fraud.

Use of a computer to commit this type of Internet fraud is a felony in many jurisdictions, for example, as covered by Penal code 502 in California, USA, and the Computer Misuse Act 1990 in the United Kingdom. There have been arrests relating to click fraud with regard to malicious clicking in order to deplete a competitor's advertising budget.

A secondary source of click fraud is non-contracting parties, who are not part of any pay-per-click agreement. This type of fraud is even harder to police, because perpetrators generally cannot be sued for breach of contract or charged criminally with fraud. Examples of non-contracting parties are:
Competitors of advertisers: These parties may wish to harm a competitor who advertises in the same market by clicking on their ads. The perpetrators do not profit directly but force the advertiser to pay for irrelevant clicks, thus weakening or eliminating a source of competition.
Competitors of publishers: These persons may wish to frame a publisher. It is made to look as if the publisher is clicking on its own ads. The advertising network may then terminate the relationship. Many publishers rely exclusively on revenue from advertising and could be put out of business by such an attack.
Other malicious intent: As with vandalism, there is an array of motives for wishing to cause harm to either an advertiser or a publisher, even by people who have nothing to gain financially. Motives include political and personal vendettas. These cases are often the hardest to deal with, since it is difficult to track down the culprit, and if found, there is little legal action that can be taken against them.
Friends of the publisher: Sometimes upon learning a publisher profits from ads being clicked, a supporter of the publisher (like a fan, family member, or personal friend) will click on the ads to help. This can be considered patronage. However, this can backfire when the publisher (not the friend) is accused of click fraud.

Advertising networks may try to stop fraud by all parties but often do not know which clicks are legitimate. Unlike fraud committed by the publisher, it is difficult to know who should pay when past click fraud is found. Publishers resent having to pay refunds for something that is not their fault. However, advertisers are adamant that they should not have to pay for phony clicks.

Article taken From Wikipedia, the free encyclopedia.

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