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Click Fraud: Coming Soon to an Advertiser Near You

On 18th April 2017

They say that experience is the best teacher…

Let’s say you run a bike tour company who’s just hired Google to place ads on relevant mobile websites, as determined by keywords. One of the sites that your ad appears on appears to be a flight search aggregator. Almost immediately, this site starts generating clickthrough for you, but no conversions. Day after day, this continues – a quickly growing pile of clicks for which you’ve agreed to pay, yet still no conversions. With all you’ve got on your plate as the owner of a small business, you don’t realize what’s going on until you receive a bill from Google and see that you’re deep in the red with respect to your monthly ad spend. Congratulations! You’ve been had by a click fraud operation posing as a flight search aggregator!

Click fraud in the advertising ecosystem

Having had years to develop and thrive on the desktop Internet, click fraud predates mobile advertising by some time. Nonetheless, on desktop or mobile, it assumes one of two common forms:

  • Fraudulent affiliate publishers (like our flight search aggregator in the above scenario) run click-generating software on their own sites or create zombie networks using botnet code, taking a cut of the CPC revenue paid by the advertisers.
  • Companies (or more likely, their off-the-books proxies) target the inventory of rival publishers in a similar fashion; this generates no revenue directly, but it does weaken the competition by depleting their resources – and may even frame them for committing click fraud on their own sites. Nasty stuff!

For the sake of inclusion we should mention that click fraud can also be carried out manually – either directly by the perps themselves or by armies of hired clickers in low-wage countries. In any case, regardless of the motive, the chief characteristic of the practice is that it maliciously forces advertisers to pay for ad clicks in which there is no genuine interest on the part of an end user. This has the more-than-just-a-little pesky result of compromising the reliability of web/mobile advertising, which raises questions about the industry’s viability and growth prospects into the long term. Not an ideal situation given the unprecedented reach and personalization made possible by mobile!

The extent of the problem and its meaning for mobile

As mentioned above, click fraud is nothing new. Invalid ad clicks have been on Google’s radar as a metric since 2006. Now, however, in 2013, mobile presents its own set of challenges in this regard. According to Gartner, mobile advertising will be a US-$20.6 billion per year industry by the end of 2015. It’s a fast-growing industry, and yet its defenses with respect to debasing phenomena like click fraud are still in their infancy.

What does this mean for mobile advertisers? An exhaustive summer 2012 report by Trademob concluded that 40% of all mobile ad clicks are invalid – meaning either fraudulent or accidental. (Accidental ad clicks result from programming, design and navigation errors and are perhaps the subject of a future blog post, but they still cost money!). This is naturally a thorn in collective side of advertisers, who are shifting greater portions of their budgets into mobile, yet are still getting a feel for the “right” amount of mobile ad spend. Any decline in ad support as a result of “fraud spook” would mean contraction in the mobile ecosystem. Nobody wants that.

Addressing mobile click fraud

Depending on the extent to which ad-related mobile traffic can be monitored, there are some general flags that can be watched for as indicators of suspicious activity. With a good reporting system and the availability of reliable data, corrective actions can then be taken. Signs that click fraud might be underway include:

  • A concentration of ad clicks that don’t reflect a campaign’s target market. Trademob gives the example of an ad campaign targeting iPhone users in Western Europe getting a lot of clicks from Android devices in India.

  • Suspicious ratios: Lots of impressions, nearly as many clicks, disproportionally few conversions.

  • Spikes of ad clicks generated by a single IP address, a single publisher, or from devices in a concentrated geographic area

Solutions are being developed to combat click fraud, but “buyer beware” should still very much be a mantra among mobile advertisers – even while accepting the risks and rewards of the current mobile advertising environment. It never hurts to request clickthrough data publisher by publisher, and to expect that reputable ad networks will blacklist suspicious publishers. With an appropriately vigilant ad network partner, advertisers should feel more and more confident that their mobile ad spend is a worthwhile investment. Not only should this result in mobile ads generating increased ROI as click fraud becomes less viable, but observations of campaign performance should also become more accurate, enabling better planning and more effective advertising into the future.

ClickAttack goes to great lengths to reassure advertisers of its scrupulousness. As Southeastern Europe’s premier mobile ad network, it thoroughly vets its publisher partners and monitors ad click metrics to minimize the risk of loss due to click fraud. Contact us today to learn more about gaining a stronger foothold in our local and regional markets.

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