The Whats, Whys, and Hows of Click Fraud

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Anyone buying Internet ads should be fully aware of click fraud. Known as a one of the most prevalent online crimes on the web, click fraud occurs when a person, bot, program, or automated script manipulates clicks on CPC or PPC ads, by generating false clicks or traffic to drive up advertiser costs.

How it occurs

Sophisticated forms of click fraud usually involve people setting up bots, programs or writing scripts in order to click on ads or links repeatedly. However, click fraud can also be as simple as a publisher or their friends manually clicking on ads numerous times to generate revenue. Some people even take this to another level by using click farms to hire individuals to click on ads.

Why are people committing click fraud?

Eliminating the competition, personal gain, and malicious intentions are some of the most common reasons for click fraud. The crime is becoming increasingly common. In fact, according to Freakonomics, in the fourth quarter 2007, the click fraud rate increased from 14.2% to 16.6%. That's a staggering number, considering that there are billions of clicks on the Internet. That's why advertisers and online ad networks and continuously finding more and more ways to fight it.

So why do people commit click fraud? Eliminating the competition, malicious intent, and personal gain are the most common reasons. Those that wish to harm their competitors commit click fraud by targeting a competing company's ads to generate fraudulent clicks. These clicks then inflate that company's advertising bill and force them to pay for false clicks. Doing this depletes the competitor's funds and prevents them from running more ads. Competitor click fraud is especially harmful to small businesses, since they usually don't have huge advertising budgets.

Publishers have also been known to commit click fraud. Since they stand to gain a profit when people click on ads on their website, publishers can sometimes click on the ads themselves or tell their friends and relatives to "help" them click on the ads.

At times, competing publishers have been caught committing click fraud for the purposes of attacking competing websites. However, not all cases of click fraud are brought about by competition or greed. Sometimes, those with malicious intent commit click fraud to simply harm another advertiser or publisher. Reasons include personal vendettas, political motives, and more.

The fight against click fraud

Click fraud is considered a crime and has serious consequences for those that are caught. At the very least, click fraud will cause you to get banned from an ad or publisher network. There have also been arrests related to click fraud as it is considered a felony in several jurisdictions.

Advertising networks are also diligently working hard to fight click fraud. Since online advertising networks want to preserve the quality of their publishers and advertisers, they continuously monitor clicks and record the IP addresses, time, and date when the clicks occurred. This data is then used to filter our fraudulent clicks. Click patterns and various activities are also monitored in order to identity invalid clicks.

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