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Old 09-29-2004   #1
sebastian
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Click-Fraud said to be 50% of clicks

i know i tend to ruffle some feathers...

but, the following article is very disturbing for me:

http://www.mediapost.com/dtls_dsp_ne...?newsId=271261

with both companies, (google and overture ...but not yahoo paid inclusion, ...yet), i am experiencing ridiculous click-thru numbers on events where i KNOW i am not only the least expensive, but carry the most inventory.

for example, i am getting hammered on certain keywords and not making the sales. i am the lowest priced in my market and carry more inventory than anyone. it makes no sense to experience this many clicks and not make a sale.

furthermore, on events that we are just "experimenting" with and have less competition, we will make 3 or 4 sales from a very small number clicks. ...many if these shows we don't even carry in-house, so they have a 40% markup associated.

these things just don't add up, and i believe these articles that scream click fraud is growing. it's the nature of the internet for unscrupulous business folks to try any tactic possible to degrade competition.

i also find it odd, that your companies (PPC search enigne companies) do not address this issue more often with your customers. it's an obvious problem, and one that is growing both in truth, fiction and media.

we are enhancing our tracking system to test IPs and the consistencies of certain ones; but how do we handle DHCP IPs coming out of large ISPs. i found one of these click programs and they will instantiate a session, click whatever you specify, then release the IP and ask for another one from the ISP. if it gets the same IP which by the nature of DHCP is quite common, it will release again and keep going until it gets a new IP.

how could you possibly protect against that?

Engine Reps: please advise as to what your companies are doing to protect us, beyond arbitrarily not charging us for all clicks...

thanks.
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Old 09-29-2004   #2
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Post Video + Documentation

There is a firm that you can hire to document what is happening to you + video of the browser activity you may not see with a clean computer.

Last edited by MrMackin : 09-29-2004 at 11:35 AM.
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Old 09-29-2004   #3
sebastian
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interesting ...however, it seems counter-productive to pay additional money to another comapny that babysits the engines.

the engines should NOT do their own fraud protection. it should be a third party company that has demonstrated quality integrity and functional superiority to tackle this problem. ...an "auditable" company that WOULD relase fraud statistics.

how can the engines be allowed to NOT release fraud statistics?

that information is very important to advertisers and could help advertisers work around it.

this overblown ego approach to business is wrong.

if i sold seed products, and periodically competitiors were coming into my stores, or my distribution partner stores, and cutting open my seed bags, i would demand to know "how many seed bags were being cut"

it's basic logic.
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Old 09-29-2004   #4
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The best defence from us - all the active advertisers - is to bid on ROI, not on CPC. If the click fraud goes up then our max CPC goes down. Money talks and this will make the engines prioritize it more.
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Old 09-29-2004   #5
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Click Fraud is sort of like chargebacks for CC processors. The only one with anything to lose is the advertiser/merchant.

They'll do just enough so they can answer the WSJ in the next conference call.

But clickfraud, just like chargebacks for CC processors, certainly does generate revenue. So it's almost certainly in their interest to maintain some level of clickfraud.

Also, think about it. The intention of most people performing the clickfraud isn't just to cost competitors money...
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Old 09-29-2004   #6
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Quote:
Originally Posted by bakedjake
Also, think about it. The intention of most people performing the clickfraud isn't just to cost competitors money...
mesothelioma, $100, click, try another, $100, click, try another, $100, click, etc. ... looking for a nice uptick in my porfollio next quarter
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Old 09-29-2004   #7
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Post

This issue is actually as old as PPC: I can remember it being discussed at
length way back in the times of GoTo (which, for the younger members on
this forum, was later renamed to Overture before Yahoo! finally gobbled it up).

Quote:
Originally Posted by sebastian
we are enhancing our tracking system to test IPs and the
consistencies of certain ones; but how do we handle DHCP IPs coming out of
large ISPs. i found one of these click programs and they will instantiate a
session, click whatever you specify, then release the IP and ask for another
one from the ISP. if it gets the same IP which by the nature of DHCP is quite
common, it will release again and keep going until it gets a new IP.

how could you possibly protect against that?
You could to some degree but even a fairly weak protection might possibly
cost you more than it would help you save. E.g. if someone's using an ISP
like AOL who will issue a fresh IP for every new browser window opened, it's
fairly easy to track combining a list of IPs and their owners plus time stamps,
etc. so that's fairly trivial.
However, the real fun starts when people resort to daisy wheeling clickbots
across a wide range of unrelated physical servers and IP blocks possibly
spread over several countries and continents.
(There's a legal angle to this as well, btw: if the culprits pick their
jurisdictions with care, it might even be quite legal for them to work this
scheme. To this very day, many countries still don't maintain any serious
checks and balances in their legal systems to combat IT related crime
effectively.)

Still, if there's one thing you can learn from the past as well, it's that PPC
companies seem to react fairly wimpishly if you take a strong stance of
disputing their claims to unique, non-fraudulent traffic generation and the
costs accrued.

In other words: get your stats right, hire a team of good lawyers and go in
for the kill - five will give you twenty that they'll buckle up if only because
their fraud protection tech is so low grade, it simply won't stand up in court.
After all, this is a generic technical problem inherent to all PPC setups:
there just is no 100% secure protection against PPC fraud, so this is the
engines' softest spot by default. (Consider: if push comes to shove, you
might even consider sueing them in criminal court as accessories to the fraud
perpetrated.)

In tandem, none of them are too keen on the PR repercussions such a case
can have. It's happened before and the only surprising thing is that it's not
happening far more frequently. (If it did, you can be sure it would be heavily
publicized at some point.) Once advertiser start getting seriously worried
about this issue (as they well should), down goes the PPC companies'
revenue and ROI.

Mikkel's quite right: money talks - so why not engage in some truly
interesting conversation.
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Old 09-30-2004   #8
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What Mikkel said

You can't get rid of click-fraud, but if you manage to ROI you can keep it from costing you more than the industry average.
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Old 09-30-2004   #9
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CPA vs. CPC

ROI is the most important metric. For that reason, I would consider doing a CPA(cost per acquistion) program through one of the affiliate marketing companies. That way your publishers bare the risk of click fraud, and you only pay commissions when you make sales.
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Old 09-30-2004   #10
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If you track the incoming IP's you will see when the same user is clicking through again and again. You then take this to G or O and get real loud. They should play nice and give you an adjusted bill.

At least G should since they "Do no Evil"
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Old 10-01-2004   #11
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I think i ruffled some engine feathers ...if i don't post anymore you know i've been 'eliminated'.



seriously, though - this topic is important. fantomaster's post made me even more frightened as i thought of the possibilities within his scenarios.

point is - more and more technical people are getting involved in marketing. while marketing people can say, "Judge it all on ROI", the technical, analytical folks (like myself) balk at this. Just because i am making money doesn't mean it's a fair assesment. Just because the campaigns are CURRENTLY driving more sales than it's costing doesn't mean the problem will not grow. If anything, success with PPC will make the problem grow faster and to further lengths...

Here's the facts:

- click fraud is a huge problem

- ppc comapnies will not address the issues with clients (stating that sharing protection methods would allow frauders to enhance activity)

- due to the nature of the internet, it is possible to make 'click fraud' undetectible ...not saying all fraud is undetectable - BUT IT IS POSSIBLE and worse, not too difficult it seems.

- there are companies out there designed to do nothing more than click ads. they exist as you read this...

will i stop advertising? NO.

will i charge back every odd circumstance i see? NO.

Am i mad at the Engines or think there is a conspiracy? NO.

But i do believe that an approach is being taken by the engines to be quiet about it, thus hoping it will go away. ...but the higher-up techies know deep down that it won't. I wonder how often they actually *think* about it.

i bet a lot.
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Old 10-02-2004   #12
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Quote:
Originally Posted by sebastian
But i do believe that an approach is being taken by the engines to be quiet about it, thus hoping it will go away. ...but the higher-up techies know deep down that it won't. I wonder how often they actually *think* about it.

i bet a lot.
naturally a companiy is going to stay a bit quiet about fraud happening on their system. companies stay quiet about shrinkage in retail. Credit Card companies stay quiet about chargebacks and fraud on their system.

your point is valid and taken, but you are only inflaming the issue, which is easily done and is being done very well. what we need to do is propose solutions or understanding.

i made the point earlier that you should be able to check the log files for repeating IP's coming to your system from the various PPC programs you are running. This is called evidence. if you take this to Google or Overture they will look at it (if they dont you could probably start putting together a nice lawsuit).

this will continue to be a problem based on the open nature of the internet. you can deal with it or not.
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Old 10-03-2004   #13
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Quote:
Originally Posted by halfacat
i made the point earlier that you should be able to check
the log files for repeating IP's coming to your system from the various PPC
programs you are running. This is called evidence. if you take this to Google
or Overture they will look at it (if they dont you could probably start putting
together a nice lawsuit).
AFAIK, PPC companies are indeed watching out already for same-IP clicks
within an inordinately small time span in order rule out click fraud. It's a fairly
low tech protection but at least it seems to have been implemented across
the board already.

So offhand I would expect this to be an advertiser's least worry. Rather, it's
the many ISPs assigning dynamic IPs to their users (including every new
browser window) that tend to escalate the issue, one major example being
AOL/CompuServe. I'm not at all sure that PPC setups are protected against
this sort of thing even though it would be fairly easy to achieve.

And on the receiving end, any evidence you can collect within that scenario
will be circumstantial at best. (You cannot actually prove that traffic
generated via different IPs is actually the same person or clickbot, only the
ISP could do that. You can, however, make it seem highly plausible.)
That's why it's generally better to take an assertive stance and create a
stink with the PPC engines before going for litigation: as long as they
cannot be sure that they'll win their case, they will generally negotiate a
settlement with you. Which is a lot safer for both sides than running the risk
of losing in court.
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Old 10-03-2004   #14
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Quote:
Originally Posted by bakedjake
Click Fraud is sort of like chargebacks for CC processors. The only one with anything to lose is the advertiser/merchant.

They'll do just enough so they can answer the WSJ in the next conference call.

But clickfraud, just like chargebacks for CC processors, certainly does generate revenue. So it's almost certainly in their interest to maintain some level of clickfraud.

Also, think about it. The intention of most people performing the clickfraud isn't just to cost competitors money...

When CC chargebacks and bogus CC transactions are the result of PPC traffic, they add another dimension to PPC fraud. There was a time when I could get a small ROI from retail sales using PPC, if I managed my campaign effectively. Now, I don't believe that is even possible. IME CC fraud has been the direct result of PPC.

Since we are in the Wild Wild West days of the World Wide Web, there is very little accountability or law enforcement. Unless you are a big company like Google or Amazon, you can't make your own rules and enforce them. So,
you are at the mercy of the whole system.

I am wondering how long it will be before the small companies and individuals finally decide "enough is enough" and pool resources to demand and exact
accountability. The only reason PPC search engines make money off our misfortune is because we allow it. The only reason there is identity theft and the CC companies make money off our misfortune is because we allow it. We need accountability from the gatekeepers. This big fat web is run by some big fat monsters, who thrive off our vulnerabilities. The PPC search engine empire is no exception.
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Old 10-04-2004   #15
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SE have a stake in controlling click fraud but not eliminating it. Keep the numbers under the radar and it stays quiet.

The solution is quite simple:

Give advertisers right of refusal via redirect of the click into the trash bin in your CP. The concept of returns is not new, if you don't like the looks of a 10 cent or ten dollar click, you simply refuse it in real time via re-direct.

Server side solutions to click fraud puts the harmed party in control and I would venture to guess it would take a very short time for some highly effective solutions to develop, click fraudsters would be brought to their knees.

Last edited by hardball : 10-04-2004 at 10:56 AM.
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Old 10-04-2004   #16
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Do the large PPC companies do a good job of detecting click fraud? I mean, do you always have to bring it to the PPC's attention or will they bring it to the customer's attention?
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Old 10-04-2004   #17
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We were the victims to over $5,000 worth of click-through fraud in one month with Google. After requesting a teleconference with their support department we also discovered that eliminating our advertisment for their affiliate sites was the best way to alleviate this occurence.

When we inquired what would happen to the culprit, a vendictive competitor we assume, we were given an extremely vague answer. I agree that an unbiased third party should be in charge of monitoring the fraud occurences so that Google does not overlook these actions. It is our opinion that if the culprit is a substantial advertiser no repercussions will await him and he'll be free to continue to plague our account in addition to others.
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Old 10-04-2004   #18
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Back when Overture began we had problems with huge click spikes with one of our clients. To make a long story short it was never resolved and we ended up eating the excess charges. As said earlier with all of the dynamic IP's out there I'm sure if you intend on committing pay per click fraud it not very hard to do.

All that remains is achieving ROI with your campaign, and in some industries it becomes harder than others. On the positive side it's still cost effective to use PPC for small to medium size web sites advertising on the web than traditional advertising campaigns which can be more expensive and not provide as good of a return.

I look forward to a time when the PPC industry can provide more intelligent software that does a much better job of catching this fraud.

Last edited by hiero : 10-04-2004 at 08:55 PM.
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Old 10-04-2004   #19
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Quote:
Originally Posted by shorebreak
You can't get rid of click-fraud, but if you manage to ROI you can keep it from costing you more than the industry average.
Lol... you can trim the fat if you monitor for it... but there are always the few who get away with it.
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Old 10-04-2004   #20
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FWIW, i hope everyone is noticing that none of the "engine reps" have responded to this post. it's an obvious attention-getter with the number of people reviewing it; yet, the engines see no reason to comment?

i really am not trying to bash 'em as it's important to me to work in tandem with them; however, this lack of ability to step up and share their opinions and what they think should be done is kinda lame. ...but very typical of corporate mentality.

i'd love to see one lone rogue who would jump in here and say, "we know click fraud is a problem, and here is what we intend to do:" ...blah blah blah - and proactively suggest ideas and strategies to help protect against it. i'm sure it would be the same old things we already know or do, but some attention to this matter is just expected.

they won't and they will hide behind the excuse that they are "giving away tactics" ...but in reality, time goes on ...click fraud grows ...and a couple of stanford dudes sit fat-n-happy in cali-forn-i-a.

...maybe i'm just jealous.

cheers.

sebastian "christian"
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