Are You Losing Your Marketing Budget To Click Fraud?

If you’re in the business of advertising online, you might have heard of click fraud. This awareness of this practice has been growing over the past few years, and more and more people are becoming aware of how click fraud affects their bottom line.

You might have heard of click fraud, or even seen the terms ad fraud or invalid traffic, and wondered exactly what it means. So, we’ll quickly explain what are these terms.

What is Click Fraud?

The practice of clicking on paid ad links for vindictive purposes is known as click fraud. For example, you might see the sponsored search result for your rival’s website and click this, just because you know it will cost them money.

Click fraud can also apply to any form of non-genuine click on a paid link, for example from an automated bot.

What is Ad Fraud?

The practice of ad fraud is usually more organised and includes the use of large automated bots and complex software to create fake websites. By using these bots, developers are able to click on links or view paid videos in bulk to collect a large payout. Often ad fraud is run by criminal gangs who leverage the power of existing botnets (networks of bots).

Ad fraud is the more damaging cousin of click fraud and is estimated to cost the online advertising industry around $35 billion a year as of 2020.

Examples of famous ad fraud networks include 3ve, Methbot and HyphBot.

What is Invalid Traffic?

Also known as IVT, invalid traffic is the term that the search platforms use to refer to any form of non-genuine human traffic. So, for example, you’ll never see Google or Facebook mention click fraud in the details of their advertising packages, but you might see mention of invalid traffic.

Put simply, invalid traffic includes anything from vindictive clicks on your ads to accidental clicks from users, or from web scrapers. In short, it’s any click on your ad that does not have the possibility to be a real customer.

All About Internet Traffic

It’s estimated that around 60% of all internet traffic is automated, that is, not a human user. Most of this automated traffic is doing genuine work, for example, Google’s web scrapers which examine the internet for the data needed to present search results. There are many types of bot and automated traffic, some of which are used for malicious purposes.

For example, some bots can be used to automate activity on social media, or to perform actions such as building email lists, or collecting traffic data.

As for people, there are nearly 5 billion internet users as of 2020. That’s 60% of the global population. Many of these perform many searches on Google or the other search engines every day. In fact, there are around 6 billion searches on Google alone every day.

So, for digital marketers, paying for search engine results is one of the most effective ways to reach an audience, whether local or global.

How Does Click Fraud Affect My Business?

If you run a pay per click ad campaign, you probably have a target demographic and a budget. Let’s assume you’re spending $100 a day to target people to visit your website and buy your product.

For every four clicks on your paid ads, it is estimated that 1 of those is from a fake or fraudulent source. This might be your rival paying for clicks on your ads, it might be from organised criminals stealing ad budgets en masses, or it might be any other fake traffic source.

So, if you’re paying $100 a day, you’re paying $25 of that for nothing.

Data from click fraud prevention software company ClickCease suggests that in some industries, this volume of click fraud can be up to 60%. For example, they found that locksmiths, photographers and pest control services saw fraud levels well over 50% on average.

Put simply, if you’re using pay per click marketing, or any form of paid link online, you could be paying between 20% to 60% of that to fraud.

Don’t the Search Platforms Protect Us?

You’d think with this huge volume of fraud that the search networks such as Google or Bing would do something to stop this. And, yes, actually they do. Google maintain that they have a huge department working to prevent IVT.

But the truth is, their efforts seem to be failing. Click fraud has been growing every year, despite the efforts of the search giants.

Recently an initiative known as ads.txt was launched to prevent website publishers from fraudulently displaying ads. The plan was that this would help advertisers identify legitimate websites. However ads.txt has not been the success it was hoped, and it has even, in some circumstances made the matter worse.

Some botnets, such as HyphBot and 404Bot, have been able to exploit loopholes in ads.txt and are estimated to make millions of dollars a year.

What Can I Do To Avoid Click Fraud?

Currently the best way to avoid click fraud is to use click fraud prevention software such as ClickCease or Cheq. Both of these offer a method of blocking obvious invalid traffic sources such as bots, VPNs and known bad actors such as click farms or other sources reported for ad fraud.

If you’re spending money on PPC ads, it is most definitely cost effective. A simple search for ClickCease reviews will highlight how effective a solution it is.

We also recommend that publishers should use ads.txt, and if you’re advertising with a website, check their ads.txt list to ensure they are genuine.

You can find out more about click fraud and ad fraud here.

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