Deprecated: mysql_connect(): The mysql extension is deprecated and will be removed in the future: use mysqli or PDO instead in /home/a26f9f83/public_html/articles/includes/config.php on line 159
Is Click Fraud Really a Problem? > NetSparsh - Viral Content you Love & Share

Is Click Fraud Really a Problem?

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.

For instance, a book retailer may pay $1.00 per click based on internal metrics. These metrics dictate, for example, that on average 30% of clickers purchase a book and the average profit per sale is $4.00. So, for every 100 clicks ($100 cost), they make 30 sales ($120 revenue) and generate a $20.00 (20%) profit. Note that years ago, the same retailer may have been able to pay only $0.50 per click, but as the market matured and more retailers began advertising, competitive bidding forced the price up to $1.00 where the highest return the most advertisers can make is 20%.

The key point is that click fraud is already taken into effect when advertisers select the highest amount they will bid. For instance, there is no difference whether an advertiser pays $0.83/click for 121 clicks with 21 being fraudulent, or $1.00/click for 100 clicks when there is absolutely no fraud. In either case, the advertiser pays $100 and generates a profit of $20, and Overture and/or Google make $100. What changes is the advertiser's yield (e.g., the percent of clickers who purchased the book) which in turn effects their highest bid price. That is, with fraud, 30 out of 121 clickers (24.8%) purchased the book, and without fraud 30 out of 100 clickers (30%) purchased it. Without fraud, the bid price in an efficient market will rise from $0.83 to $1.00.

In summary, online advertisers must focus on analyzing and improving their internal metrics (e.g., conversions) and not worry about click fraud as it is already incorporated into keyword bid prices. Hopefully, the frivolous lawsuits and refund requests spawned by apparent click fraud will end as those in the industry recognize this undeniable fact.

About The Author:
Tommy Maric is the manager of TopPayingKeywords.com. TopPayingKeywords.com is designed to help webmasters maximize their profits using Google's Adsense? program. Through extensive research, TopPayingKeywords.com develops up-to-date databases of the most popular keywords and their accompanying bid prices. For more information, please visit http://www.toppayingkeywords.com.

Contact:
877-TOP-WORD
(877-867-9673)
[email protected]

In The News:

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news

VRM Intel

Making the Most of Your PPC Ad Spend
VRM Intel
When it comes to PPC (pay-per-click) advertising, marketers are always looking for ways to improve performance. The goal is to optimize the account continuously, finding ways to save money and spend more efficiently. Anyone with PPC experience knows ...


10 Tips to Create an Effective PPC Advertising Campaign for Your Law Firm
The National Law Review
When setting up PPC advertising campaigns for your law firm, it is imperative that you know and follow best practices for PPC advertising, since the legal space is the most competitive — and the costliest — on Google. Here are 10 tips that, if ...


Business 2 Community

'Tis the Season for PPC Advertising
Business 2 Community
Increasingly, marketers and brands must merge their organic content effort with paid advertising offers. Whether you're looking to get Facebook views or dominate the search engine results page, combining a natural content effort with PPC ads is ...


Digital Marketing/Advertising Internship (SEO & PPC)
Pedestrian TV
We are an expanding online media agency based in Sydney. We help companies to improve their presence on the web. Our services include; SEO (search engine optimisation), PPC (Google AdWords), content marketing and web design. What We Offer. – Office In ...

and more »

Business 2 Community

Get the Most Out of Your Google Pay-Per-Click Advertising
Business 2 Community
When is it Smart for a Small Business to use Google Pay-Per-Click (PPC) Advertising? As a marketing agency that works primarily with small and medium sized businesses, we are often asked, “is Google Pay-Per-Click an effective strategy for my small ...


Search Engine Land

Which PPC metrics matter? Lessons from half a million keywords
Search Engine Land
In other words, you want your ad spend to produce sales. As obvious as this statement is, actually determining how different factors in your AdWords campaigns affect sales can be fairly difficult. To try to shed more light on the subject, we recently ...


Business 2 Community

Why PPC? – The Advantages of Pay-Per-Click Marketing Explained
Business 2 Community
Everything about pay-per-click is measurable, from the amount that you're paying to the number of hits your website receives. This makes it a useful tool for testing different campaigns, strategies or landing pages allowing you to evaluate which are ...


Entrepreneur

So, You've Created a Website: Now, What?
Entrepreneur
Paid advertising. Your first option is to pursue paid advertising, such as through Google AdWords, a pay-per-click (PPC) ad platform that charges you based on the actual click-throughs you get for your site. This is usually a good method to start with ...


Search Engine Journal

10 Tips to Get the Most Out of Google AdWords Express
Search Engine Journal
ADVERTISEMENT. Originally launched in 2011, AdWords Express (AWE) set out to provide an accessible entry to pay-per-click (PPC) advertising for small businesses. The target market is the large number of merchants who may not have the expertise or the ...


TNW

3 Widespread PPC Myths You're Mistakenly Falling For
TNW
Many people mistakenly think PPC is a short-term strategy. They want to inform customers about a sale or other time-dependent event, so they advertise. If their ad gets 30 clicks at $2 each, they simply want to ensure that they receive one or more $60 ...

Google News

5 Top Tips for Maximizing Your Adsense Profits

1: The ideal Google AdSense page should have great content... Read More

Organic Natural Search Engine Optimization versus Pay-Per-Click Search Engine Advertising

When you purchase visitors or "clicks" from a search engine,... Read More

3 Tips For Adwords PPC Management

Adwords PPC Management Tip No. 1Setting up an accountIf you... Read More

Adsense ? The Powerful Passive Income Generator

Webmasters have a revolutionary new method of collecting income from... Read More

How to Waste Money and Annoy Potential Customers

Why do some companies bid on keywords for products they... Read More

Pay Per Click Advertising Can Be Very Risky Business

Click fraud is an unfortunate byproduct of the pay per... Read More

Pay-Per-Click Marketing & Natural Search Engine Traffic

PPC advertising has many great benefits. First of all, you... Read More

Local Business Advertising & Google Adwords

"I don't need the Internet to advertise - I'm a... Read More

Free Pay Per Click-PPC Search Engine Advertising

Did you know that there are actually pay per click... Read More

How to Make More Money from the Google Adsense Ads on Your Blog

Numerous bloggers these days are looking to earn extra cash... Read More

Pay Per Click 2005: Very Expensive Without Expert Help

Despite being online using email since 1995, at the start... Read More

So You Want Big Profits From Your AdWords PPC Advertising Campaigns?

So You Want Big Profits From Your AdWords PPC Advertising?... Read More

Pay Per Performance Advertising : What is it?

Pay Per Performance Advertising is when the advertiser pays a... Read More

Adsense Secrets

Pst! Wanna know some Adsense secrets? The only secret is... Read More

What is Google AdSense?

In the mid 1990's websites used to earn income by... Read More

Finding The Cheap Clicks

As anyone who uses Pay Per Click (PPC) advertising in... Read More

Wheres the Best Place to Put Google Adsense Ads?

Why, on your web pages of course. Ok, just kidding.... Read More

Find Powerful Keyword Phrases in Five Easy Steps!

You may not realize it, but in the next few... Read More

Web Advertising: Its All About the Click Thrus!

Working in research and development for a large infomercial company,... Read More

Can I Make Money Online with the Adsense Program?

Sure you can. If you will learn how many other... Read More

Pay Per Click Search Engines - A Fundamental Overview

Forbes magazine reported that pay per click ads accounted for... Read More

5 Ways To Make Your Adwords Ads Outshine Your Competitors

Google Adwords is a very good place to promote your... Read More

Replacing AdSense Defaults with Paying Ads

Many online ad programs, including AdSense, will sometimes show default... Read More

Expand Your Horizons - Sell Your Professional Services Through ClickBank

ClickBank allows its merchants to sell many different types of... Read More

How To Find Your Own Valuable Adsense Keywords For Free

There's tons of money to be made from the Google... Read More