Click Fraud – Don’t be a Victim!

Some StatCounter members have recently shared with us their stories about they used StatCounter to help identify and prevent Click Fraud. You can read about one case here read about one case here.

As a result of this, we decided to put together this guide to Click Fraud and explain how StatCounter can help you too…

First let’s explain Pay Per Click (PPC) advertising…
PPC advertising is offered by many ad networks. With this type of advertising you pay each time your advert is clicked. The cost of PPC advertising can vary considerably from less than 10 cents to over $25 per click.

Advertisers often have a budget per month for PPC advertising.

For example, if you have a budget of $500 per month for PPC advertising and pay $1 per click, this means that in any month, you can pay for a maximum of 500 clicks on your adverts.

If you get 500 clicks on Day 1, then your budget is spent and your site will not receive any more advertising for the remainder of the month.

What is Click Fraud?
Click Fraud occurs when individuals or automated computers click on an advert without having any interest in the product/service advertised. Click Fraud is performed, instead, simply to generate a cost for the advertiser (without any chance of making a sale) and consume the advertiser’s budget.

Who would commit Click Fraud and who benefits?
Here are some examples of the people who might commit Click Fraud:

The Competitor

    • It’s possible for your competitors to search for and click your adverts in order to use up your advertising budget.

If you have a budget for 500 clicks per month, for example, one of your competitors can “use up” any number of these clicks. Your competitor is hoping that this will mean less business for you and more for him. The end result is that you pay for 500 clicks per month, but only some of these are valid. The earlier case study case study we mentioned is a prime example of this kind of Click Fraud.

The Publisher
When you sign up with an advertising network, your adverts may be shown on numerous different websites. These websites are known as “publishers” as they “publish” adverts. These publisher websites are often paid more if they can secure more clicks on the adverts they display. This can entice some publishers to (dishonestly) click on the adverts they display on their sites or even employ third parties to click the ads on their behalf. They do this in order to boost the advertising revenue that they, the publishers, earn. The end result is that you are paying for adverts that are NOT going to bring you any sales – instead your hard earned cash is being fraudulently obtained by the publisher.

Disgruntled Employee
Unfortunately, some people who find themselves dissatisfied with their job/working conditions/salary look for ways to “get back” at their employer. One way they can do this is to continuously search for and click your adverts in order to use up your advertising budget. The end result of this is that you are again paying for advertising that can never bring you any sales. You may be paying for 500 clicks per month in the hopes of reaching 500 potential customers… but, taking out the fraudulent clicks, you may only be making contact with a much smaller number of potential clients.

Click Fraud – what YOU can do about it
If you use PPC advertising, it is vital that you monitor the visitors to your website and watch for indicators of suspicious click activity. Otherwise, you may be spending your hard earned cash on advertising that won’t be of any benefit to your business.

The first step in trying to identify Click Fraud is to understand the usual stats that you can expect from your visitors. Get to know the normal level of activity on your site by frequently reviewing your StatCounter stats and watching for patterns and trends. When you know what to expect in general from your stats, it becomes much easier to identify any unusual activity.

Here are some important points to watch if you are worried about Click Fraud, together with examples of how you can use your StatCounter stats to protect yourself from this cybercrime.

    • Repeat Visits from Same IP Address
      This is the FIRST thing to look for if you are trying to identify Click Fraud. Repeated visits from the same IP could be legitimate e.g. several visits from different people in the one organization… but they could also be indicative of suspicious activity e.g. a competitor repeatedly clicking your adverts.Use the Recent Visitor Activity information from your StatCounter stats to identify repeated instances of the same IP hitting your site.

      When you review your Recent Visitor Activity, keep the following points in mind.

      (1) Look at the Number of Entries for each visitor. This tells you the number of times that this IP appears in your detailed log file. If one visitor regularly takes up an unusually large portion of the slots in your log file, then this may be an indication of suspicious activity.

      (2) Look at the number of Returning Visits. An unusually high number of returning visits may indicate suspicious clicks on your site.

      (3) Look at the information about the IP Address of your visitors. Depending on their computer/internet set-up, you may be able to identify what corporation or organization your visitors are from. Repeated visits from a competitor may signify Click Fraud.

      (4) Use the StatCounter Label IP Address function to label any IP addresses about which you become suspicious. This will help you to keep track of future activity from this same visitor on your site.

 

    • Time Spent on Site
      Looking at the time visitors spend on your site can also help you identify instances of Click Fraud. For example, automated bots designed to commit Click Fraud will generally only spend a very short time on your site. If you establish how long the average visitor spends on your site, then you can identify and monitor suspiciously short visits. Use your StatCounter Visit Length stat to track the time visitors spend on your site.

 

  • Country Breakdown
    As we mentioned earlier, some unscrupulous publishers have outsourced the task of committing Click Fraud to fraudulently increase their profits at your expense. Many of these third party Click Fraud operations are located in countries such as India, Ghana, Morocco, Nigeria, Romania and Russia. If you get an unexpected number of clicks from any of these countries, this could mean that you are a victim of Click Fraud. Use the StatCounter Recent Visitor Map to identify the geographical breakdown of your visitors.


Click Fraud – The Conclusions

No-one is immune to Click Fraud and, although the advertising networks can and do screen out some instances of this practice, they do not catch all illegal activity. It’s up to all of us who pay for PPC advertising to make sure that we don’t fall victim to this crime.

The methods employed to commit Click Fraud are becoming ever more sophisticated and it probably isn’t even possible to identify all instances of this activity, but using the suggestions in this article you should be able to better protect yourself from this fraudulent practice.

Please feel free to share any other ideas about how to detect and prevent Click Fraud in the comments section below!

UPDATE: How NOT to be a Victim of Click Fraud

Further to some questions posted in the comments below, we want to emphasize that it’s almost impossible to stop people fraudulently clicking your adverts… but it IS possible to minimize your financial loss because of this activity. See the case study we mention in the first paragraph of the article.

You only become a VICTIM of Click Fraud IF it ends up costing you money. If you can identify it and report it to your ad network you can claim a refund. This means that you don’t lose any cash because of this deceitful practice.

Also, if you can identify that a competitor is committing Click Fraud, then make direct contact with them. The possibility of legal action is usually enough to prevent them from engaging in Click Fraud at your expense in the future.

123 comments on “Click Fraud – Don’t be a Victim!

  1. Awesome information. Definitely good ways to help track click fraud. Plus it will get people checking their stat counters more… which is good for people advertising on statcounter. 🙂 Anyhow, I don’t know why you wouldn’t be checking your stat counter often, as statcounter.com rocks! Thanks for all the good work you do!

  2. No umaianime, you are wrong. at the end of the day its all about ROI, you have to be really very competitive in order to justify the ppc spending. instead of running whole 100% of the ad budget it makes sense to give 10% of it to a professional company who will manage it for you.

    As far as click fraud is concerned, we all know it is going to be there as after all no one can measure the “intention to click”.

    As in our industry of dui and mesothelioma lawyers , keywords cost more than 90$ per click to google for 1 click and so you can imagine the click fraud in the lawyers industry. But what we have experienced is that once a competitor clicks our ads, yes we get charged for that but for any click(s) after that Google does a very smart job of validating them based on their behaviour

    Remember, Google has recorded their mac address +ip address + cookies + ctr signature and their behaviour on clicking the Google adsense ads while browsing from day 1. So since we know that competitors are trying hard to deplete the budgets of competitors (remember some of our industry keywords are more than $90 per click), Google does a very smart job and does a behaviour analysis of those competitors and not credit invalid clicks to advertiser.

    But think of it like this, if its costing us $600 (4 valid + 2 invalid clicks) to win a client that will get us 12,000$ , Does click fraud then really matters?

  3. Thanks for the very informative post on Click Fraud…….I agree with some of the other comments in that pay per click advertising is not worth the effort…..it may have worked in the past but today its a waste of time and money………..

  4. One of the better overviews of PPC. Regardless of what the big three have to say about it, they’re only in it for them. They won’t curb it nearly as much as someone in your organization that actively monitors the traffic.

  5. My business has been killed by click fraud. I quite a lot of research on the issue and click fraud is big business that is perpetrated by well organised, very sophisticated and determined criminal organisations.

    Google has long stopped repeated clicks from the same IP. More likely the clicks are coming from compromised computers (botnets – of which there are millions in the world) or click farms, etc.

    To identify click fraud look for spikes in Click through rate and especially Cost Per thousand impressions (CPM). However, these are less useful as indicators as there is now large scale impression fraud (as I say, the people who do this are very sophisticated).

    If you find your company being killed (as I did), Google (which profits from click fraud and therefore has no incentive to do anything about it) will do absolutely nothing to help you.

    Pay per click is one of the biggest frauds the world has ever seen.

  6. Hi,

    Useful article about click fraud and how statcounter is useful in finding the activities.
    I’ve visited the site.
    The admin posts that google returns the fund for the clickfraud activity.

    🙂

  7. I will take the opportuinity of this post to send my message to Google accounts who disabled my Adsense account recently for invalid clicks without any explanation or warning. After they disabled my Adsense account it occured to me to check my Adwords accounts only to discover that I paid $ thousands for click fraud so I stopped all my ads. I lost 2 months revenue in Adsense and Google would not discuss or tell you why, because as they say, this would help people learn how Google detects click fraud. Let me tell you that any techniques based on IP address and cookies they are using are useless. These things can be reset every second these days and I can give you simple software that can do this. IN FEW WORDS, PAY PER CLICK ADVERTISING DOES NOT WORK ANYMORE. The solution for this would be pay per result advertising. No body is going to click on an ad who is not interested in the product and going to pay for it.
    This reminds me of a small incedent years ago when I started Adsense on my site, I clicked on a Google ad I was honestly interested in it and followed the pages untill I bought the product and paid for it with my Master Card. Moments later I received an email from Google accounts telling me NOT to click on my own ads. That was a first warning and if it is repeated my account would be disabled. years passed by since then and my adsense account was making only few dollars a day. recently my account started making more, and of course Google keeps 2 months revenue unpaid at anytime. and this was the right time to disable the account.

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