Techcrunch just posted an interesting article on a huge click-fraud operation based in China that confirms my recommendations to clients to restrict their PPC advertising to search engines only, and not their content network.
Apparently this ring of fraudsters numbered over 1,000 people, 10,000 websites and 200,000 IP addresses and clocked up USD$3 million in advertising fees from over 2,000 advertisers in just 2 weeks.
This click fraud ring was identified by Anchor Intelligence, shut down and no payments were made, but they are the first to admit that this ring is only one of many, the perpetrators have not been stopped and have likely set-up another ring by now.
4W have always advised avoiding search engine’s content networks with regard to PPC advertising precisely because of click-fraud. This particular scam may have been operating in China but there are likely many smaller scale operations in existence in countries in which our clients do advertise (including the UK).
Unless the client wishes to indulge in a lot of experimentation and analysis (time consuming and costly) then their budgets are best spent with the search engines themselves, and not their content partners. While there may be some form of smaller scale click-fraud on search engines there is a much less obvious benefit to fraudsters and likely much less of it.
It has been a long-held view here that Google Adsense (paying website publishers to display Google PPC ads) has been very detrimental to the internet as a whole. Websites are quickly set-up just to grab some traffic and earn a few dollars with little concern for the quality of the content and relevance to the user – this dilutes the internet, uses up valuable domain names that legitimate businesses would like to use, and encourages spam and click-fraud on a massive scale. “Don’t be evil” – yeah right!
Until the online advertising industry moves to a cost per acquisition (CPA) model then cost per click (PPC/CPC) and cost per page impression (CPM) will be subject to widespread fraud.
