Table of contents
- 1 What is Click Fraud?
- 1.1 And how to stop PPC fraud.
- 1.2 Mechanics of PPC and Paid Campaigns
- 1.3 How Click Fraud is Executed
- 1.4 Who clicks your ads?
- 1.5 Who is affected?
- 1.6 Dealing With Invalid Clicks on Campaigns
- 1.7 What is AdWords Doing About This
- 1.8 Legality
- 1.9 Are you a victim?
- 1.10 How to Manually Block Click Fraud
- 1.11 How to Automatically Block Click Fraud
What is Click Fraud?
And how to stop PPC fraud.
The rise of digital marketing, specifically PPC campaigns, has done incredible things for companies. It lets them target specific demographics. It also puts them in front of consumers in a way that was never possible before. Since consumers have moved online, as that is where most purchasing decisions are made today, PPC has become a necessity for companies of all sizes and industries. A quick overview and then I’ll dive into what’s on your mind, click fraud.
But as incredible as PPC is for companies, it has its downsides. It exposes companies to competitors and makes them easy to target. This has led to an increase in click fraud, practice competitors use to run companies out of the marketplace. Click fraud can be perpetrated manually or automatically. Its main purpose is to rack up clicks on competitors’ ads for the purpose of draining their ad budget.
Are you affected by click fraud? Read on as we guide you through the basics of click fraud and how to protect yourself.
Mechanics of PPC and Paid Campaigns
PPC (pay-per-click) advertising, is a digital marketing model. It’s where advertisers pay to promote their brand or product through ads, and pay a small fee each time their ad is clicked.
Search engine advertising is one of the most popular forms of PPC advertising. It can be done on any of the various advertising networks. The most popular advertising network is Google AdWords. Using AdWords lets companies create and place ads on the Google search engine and Google’s other properties.
PPC lets advertisers bid and pay for ad placement in the search engine’s sponsored links. So if a picnic basket company bids on the keywords “outdoor picnic basket”, their ad will likely show up at the top spot of the search engines results page for that query. Every time the picnic basket company’s ad is clicked, they have to pay the search engine a fee. Paying a fee to the search engine may seem absurd, but if you’re running your PPC campaigns correctly, it’s worth it. Think of spending $5 to get a customer through your doors. You would probably spend that money and more, as it has the potential to lead to a sale. With this in mind, that $5 investment becomes trivial in the face of the expected benefits arising from the transaction.
PPC is a great way to increase profits in a company, but it’s like handling a weapon. Used correctly, it can do wonders; but used incorrectly, it can drain an ad budget with little to show for it.
How Click Fraud is Executed
A quick Google search of the words “buy clicks”, is all you need to understand the vast and nasty world of click fraud. Clicks can be purchased, bots can be created, and fraud can be executed by a person, a bot, or a click farm.
When a person is hired to perpetrate click fraud, they’re often from a developing country and may charge as little as $5 for 100 clicks. The hired worker will sit at a desk and click a specific ad or ads over and over again. Because it’s such a tedious task, developers have created automated tools, referred to as “bots”, to carry out the fraud.
Bots are let loose to rack up clicks on a particular ad and can be programmed to be relatively simple or really advanced. Not all bots are bad or created with bad intentions. But because click fraud is a tedious task that simply requires an ad button to get clicked over and over, bots are the perfect tool. The third way that click fraud can be executed is through click farms. Click farms have gained people’s attention because they’re rapidly growing in number. A click farm is the digital equivalent of a dairy farm, only instead of rows of cattle attached to machines, workers. They are often in developing countries and get paid a pittance to sit at desks. These farms click on ads for their living.
However click fraud is executed, it’s a growing problem. It’s gotten so bad that an estimated 90% of all campaigns suffer from click fraud. And the general consensus is that up to 20% of a company’s total advertising budget gets wasted on fraudulent clicks.
So let’s take a deeper dive into who might be clicking your ads.
Who clicks your ads?
Click fraud has many faces. Every industry suffers from a different type of click fraud. While industries like casinos and gambling may suffer from large-scale click fraud operations other industries like locksmiths and plumbers may suffer from manual competitors clicks. It is also important to keep in mind that not all forms of click fraud are malicious. Click fraud may be executed unintentionally by your current customers or even by friendly bots.
Here are the main forms of click fraud. We divide them into 2 groups. Malicious and non-malicious click fraud.
Malicious click fraud:
Competitors are clicking on each other’s ads. That is a fact. Why would they do that? Here is the obvious reason:
Every business has its advertising budget. Some businesses set a daily budget, others set it monthly. Either way, if your budget gets depleted your ads will go offline and your potential clients will not be able to see your business online. Your competitors know that so they will try to find the most creative ways to click you out of their way. It is a known fact that the higher you rank on Google ads the more leads you get. Everyone wants to be positioned at #1 or #2 in Google search results. This is what fuels the click fraud industry.
Manual Competitors Clicks:
This click fraud method is most common in small and medium businesses. You wouldn’t expect Coca-cola to be clicking on Pepsi’s Google Ads, because the advertising budget is huge for these guys but you can expect the local locksmith to click on his competitor’s ads. Imagine a local business who clicks its competitors’ ads 4-5 times a day over a month, every month. These clicks almost never get detected by Google ads filters and result considerable loses for the local advertiser.
When CPC is high, and each potential client worth a lot of money (industries like Casinos, plastic surgeons etc) companies tend to spend some of their budgets on bots in order to automate the click fraud process. Instead of manually clicking their competition they set up a bot to search for the most expensive keywords and click on specific ads.
Imagine hundreds of clickers sitting behind desks that each contains dozens of different devices. Click farms are a scaled click fraud operation. In the past year we have detected smaller groups of clickers (4-10 individuals) offering small businesses to click their competitors out of business. Such groups were detected in Miami and LA.
Ex-employee? Disgruntled customers? It isn’t always your fault. Anyone with a reason can click your ads and waste your ppc budget. The good news is that such clickers usually tend to stop clicking your PPC ads within a few days.
Non Malicious click fraud:
You should bid on your brand name. You probably know that by now. The downside of that approach is that also your current clients will be clicking your brand ppc ads. A Google ad is so similar to an organic ad that more than 60% of users will not notice they click an ad and not an organic result. This, of course, will cost you, unless you use ClickCease to block such unintentional click fraud.
There are countless companies which scrape the internet in order to find out which companies advertise for which keywords. Some of them click your PPC ads in order to collect some extra information from your website (information such as address, phone number, emails etc). Each of these clicks cost you. These bots which scrape the internet aren’t targeting your ads specifically but once the ad is clicked the damage is done.
Who is affected?
Click fraud affects businesses of all types and sizes.
If you think of a local service provider such as a locksmith or a plumber, their whole business strategy in terms of digital marketing lies in PPC advertising. Imagine getting locked out of your house, or having a plumbing problem at 9 pm with no idea what to do. The first place you turn to is the internet. You would likely search, “locksmiths around me”, or, “plumbers in area code:x” and click on the first ad you see. On the other hand, consider large companies that run huge PPC campaigns to attract the attention of customers.
There are 3 industries in particular though, that are more vulnerable to click fraud than others. According to a 2015 Bloomberg click fraud report, the 3 most affected industries or categories of business, are finance, family, and food. The reason for this is that they all have a relatively high cost-per-click (CPC) and search volume. An industry with a huge amount of traffic and expensive keywords means more room for fraudsters to hide. It also means less risk of getting caught, and a higher payout. Here at ClickCease we see that the most affected micro industries are: Locksmiths, DUI Lawyers, Water damage repair and… dentists. It seems that local service providers are prone to a higher rate of click fraud due to the competition, high CPC and the knowledge of the market.
No matter how little or how much money gets spent on campaigns, one thing is for sure. Every company that’s using PPC networks like Google AdWords or Bing Ads, is either vulnerable to click fraud or has been a victim of click fraud.
Dealing With Invalid Clicks on Campaigns
With click fraud being a massive (and growing) problem, you probably assume that the ad networks are taking serious steps to prevent it. Fortunately, the most popular one, Google AdWords has an Ad Traffic Quality Team. They work to detect and handle invalid clicks, but unfortunately, the steps have not been significant enough.
In order to filter out invalid interactions, the AdWords Ad Traffic Quality Team examines every interaction on an ad. The team looks at various data points, including time of the interaction, IP address, if there are duplicate interactions, and other patterns and trends.
What is AdWords Doing About This
AdWords retention teams and support agents are constantly receiving complaints from advertisers: “A Competitor is clicking on my AdWords ads. ”
The normal response these advertisers will receive is a template answer which basically says that the clicks are from normal user behavior.
After invalid clicks are detected, AdWords will filter out clicks before they reach your account reports, if they are considered invalid. Additionally, if you think AdWords missed fraudulent clicks on your account, you can have the team investigate. They will process your request within a few days. If the clicks are in fact found to be fraudulent, AdWords will reimburse your account, but only 2-3 weeks after the fraud took place, and only if you notice it and claim it.
The immediate result of this is that your ad budget would be exhausted prematurely, resulting in missing critical opportunities. Your ad would also not be online for a few hours or days. Additionally, Google’s click fraud criteria are identical for each and every advertiser. So while 10 clicks from the same IP address in a period of a day is completely normal for one advertiser, another might see it as click fraud.
Though Google has practices in place to protect your PPC campaigns, they’re often just not enough.
(Read more about what AdWords is doing about this HERE).
With click fraud costing companies billions of dollars every year, you have to ask yourself: “who is responsible for stopping it?”.
Who should be the “police” and reprimand the fraudsters, or serve them penalties like fines or jail time? And are there laws in place protecting you?
In terms of click fraud and the legal system, there is currently no law in place to protect you. Since click fraud happens so fast, and attacks can come from around the world at once, it’s hard for legislators to create a body of laws that pinpoint the act of click fraud and claim it as illegal. Additionally, a click is only fraudulent if it is done with a fraudulent intention. This makes it really tough to decipher fraudulent clicks from legitimate ones. Click fraud is hard to identify and even harder to tackle.
There is a US law called the Wire Fraud Act. It was established to prosecute financial fraud using telecommunications. The law comes with a 20-year sentence. But it’s used in very limited cases. And nobody that’s been accused of click fraud has gotten this kind of sentence.
Are you a victim?
The best ways to check for click fraud in your accounts is to:
Monitor account activity: Check your analytics often and look out for strange trends, spikes, or patterns. One spike that should set off alarm bells is a sudden spike in your CTR. This is a telltale sign, as someone is purposely looking for your ads and clicking on them repeatedly. Also be aware of the locations your clicks are coming from. If you’re in the US and you see lots of clicks coming from Ukraine, something is up.
Measure engagement: Analyze your data and determine if it’s suspicious. Check your KPIs and look for red flags like abnormally high CTR with few conversions. If you’re getting a large number of clicks that don’t equate to more conversions, you may be a victim.
The more competitive an industry, the more click fraud it will see. Local service providers such as locksmiths, plumbers and lawyers see an extremely high amount of fraud. These campaigns will normally see manual click fraud.
Big brands and highly visible campaigns will see more bot click fraud.
How to Manually Block Click Fraud
Manually blocking click fraud and protecting yourself from future fraud is labor intensive, but it’s possible.
Here are some actionable steps you can take to decrease or negate invalid clicks on your ads:
1. Set Up IP Exclusions: Take the time to identify the IP address that’s associated with the fraudulent clicks you’re getting. You’ll then want to set up an exclusion to block your ad from the IP address that’s receiving your ad.
2. Run Remarketing Campaigns: With remarketing campaigns, you’re only showing ads to people who’ve visited your page in the past. Running remarketing is great for two reasons. 1. They ensure you’re staying clear of click fraud, and 2. They ensure your ads are only visible to relevant audiences.
3. Adjust Your Targeting: If you suspect your ads are receiving invalid clicks, it’s time to adjust your targeting. If you’re getting clicks from a certain geographic location, you should exclude those regions and their languages. Most click farms are in developing countries. That’s why you would see a large number of clicks from one specific place. Additionally, try to avoid targeting large groups of people. Target niche sites and demographics that you know well and are familiar with.
4. Use Smart Techniques to Throw Off Bots: One of the most popular ways of avoiding bot clicks is with a captcha security system. Many companies frown upon using captchas. They feel it annoys customers and disrupts the user journey. That’s what makes a honeypot field a great solution. A honeypot field is an invisible field that only bots can see. A bot will often mistakenly fill in the honeypot field instead of the real field, alerting you to fraudulent clicks.
Protect yourself from click fraud with DIY techniques is a good idea. But many advertisers lack the time or resources to be checking each and every click for validity.
How to Automatically Block Click Fraud
The damage and loss that click fraud can cause you and your business is significant. But that doesn’t mean that you need to lose hope. Luckily for you, there are solutions out there that can automatically protect you, and block fraud. When Google AdWords and the other ad networks aren’t doing enough to protect you from click fraud, you can count on ClickCease.
The ClickCease solution integrates with your campaigns to stop click fraud automatically. The algorithm monitors each and every click to collect valuable data. It also detects real potential customers from fraudulent ones and blocks fraudulent clicks. Even better? The smart system will hide an ad from a fraudster if and when it detects a fraudulent click. It’s not just a solution to augment your campaigns, it’s crucial to your business’s success.
When you want to get the most out of your ad budget and campaigns, turn to ClickCease, the company that protects over 274,000 campaigns in 181 countries.