| Is Click Fraud Really a Problem? |
| by: Tommy Maric |
Click fraud is currently a major topic in online advertising. Many argue that it presents a threat to the stability and viability of pay-per-click (PPC) advertising, the key revenue generator for both Google and Overture. In actuality, click fraud is not a significant issue at all. Click fraud occurs when ads are clicked for reasons other than a genuine interest in learning more about the product or service advertised. Click fraud occurs in two forms. In one instance, fraud arises from competitors trying to sabotage each other. One competitor clicks on the ads of another just to drain the budget of that company. The other instance occurs when webmasters (or people associated with the webmaster) repeatedly click Google AdSense ads (which are syndications of others’ ads) on their own web pages in order to generate more revenue. While both Overture and Google have developed sophisticated technologies to detect click fraud, their systems are, and may never be, foolproof. The real question is how much does click fraud actually damage the PPC industry? Gross fraud, i.e., when one person or technology consistently and repeatedly clicks on an ad, aside, which Overture and Google can easily detect, we believe that click fraud has no real impact on the industry. The following explains why. Efficient market theory says that it is impossible to “beat a market” because prices already incorporate and reflect all relevant information. As the PPC industry has matured, efficiency has begun to take root. That is, the price of each keyword has been driven up to the point where it reflects the highest price an advertiser is willing to pay for a click. |
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Empire Realty - Upland, CA
Empire Realty Upland, CA - Full Service at a Discount
Click on Wayne, click fraud is everywhere and your right it is factored into the pricing. I click on competitors PPC advertising when I am surveying their info.
Take care!
RJH
Dec 12, 2007 03:49 PM
Coldwell Banker Residential Brokerage, Lancaster PA - Lancaster, PA
Lancaster County PA RealEstate Expert 717-951-5552
Jennifer, I suspect that click fraud ends up costing advertisers a similar percentage to what shoplifting costs retail customers...
Dec 12, 2007 03:56 PM
KELLER WILLIAMS BATON ROUGE - Baton Rouge, LA
Baton Rouge Real Estate
I does!
I spend a couple of hundred a month on adsense and Im sure a few of the clicks are not legit.
Dec 12, 2007 04:02 PM
Rainer
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Jennifer Dazet
Baton Rouge Real Estate
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