Identifying and tracking examples of click fraud is the first step to eradicating the problem. Click fraud is an enormous drain on the resources of advertisers operating on a national and international scale, estimated to occupy around 30% of all pay per click advertising spend. With so much at stake, its no wonder the search engines are investing so much time and effort into devising solutions.
One way in which Search Engines and other pay per click programme providers have attempted to curb the growing click fraud problem is through introducing IP address repetition algorithms. These formulae are designed to pick up on suspicious click patterns emanating from a singular IP address, which can help to uncover the existence of click farms and competitor-led sabotage, as well as identifying potential fraudsters at source.
However, there is an array of problems with this method of attempting to identify the fraudsters. Firstly, fraudsters logging on through a dialup modem, DSL line or cable modem can almost completely bypass this check, as with every new online session, a new IP address is generated. Furthermore, there is an extensive range of software available to alter IP addresses, which again can be used for 'cheating' the algorithm. Cookie and session tracking are other methods by which search engines can attempt to uncover potential fraudulent activity, but again there are ways around these for the fraudsters.
More comprehensive software is being developed which profiles and reports on the browsing habits of each click-through to enable companies to track and monitor suspicious behavior, although this could be seen by many as intrusive and ineffective as anything on a small scale is still likely to go unnoticed, based on the vast coverage of ads across the internet.
The problem of click fraud recently hit the headlines with a class action raised against Google, prompting Google to offer $90million as a potential settlement. Perhaps an acceptance of their responsibilities, Google's offer goes some way to suggest the extent of click fraud, and its vast costs to the internet economy.
There are a number of self-help remedies that can be implemented to keep an organization out of trouble. The first of these remedies is the reliance on search engine optimization and organic listings. If a site is well and fully optimized, it could eventually realize a ranking that another site is willing to pay $2.50 a click for. Similarly, with organically high rankings there are no clickthrough rates, therefore the costs associated with PPC are not applicable. Although the process is significantly more laborious and takes significantly longer to see results, the SEO process is much cheaper in the long run, and with an estimated 25-30% of all clicks being performed fraudulently, an organically high listing can save money which would otherwise be drained by click fraud for more beneficial reinvestment.
Year on year, as the pay per click advertising market continues to grow and expand, surely click fraud will follow suit. Unless an effective means of preventing click fraud is developed and successfully implemented, buyers will steadily lose confidence in the advertising medium and turn to more effective, less wasteful marketing methods, which would seriously hit the search engines and could potentially threaten the online economy as a whole.