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Click Fraud Making Headlines Again

Nick Wilson
Expert Author
Published: 2005-03-03

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Two major headlines today on click fraud, the first comes from Mediapost reporting from SES NY who say ...

Marketers need more info from search engines ...

FOR SMALL SEARCH MARKETERS, CLICK fraud can pose major problems by decreasing conversion rates and ratcheting up ad costs. But, while the challenge is well-known, finding a solution isn't so easy--and, in some instances, might actually be hampered by search engines themselves, said industry experts at a panel discussion Wednesday at the Search Engine Strategies Conference in New York. "People are losing money--money is, in effect, being stolen," said Reed Smith attorney Peter Raymond. Click fraud occurs when a competitor, affiliate, or disgruntled employee creates fake traffic to a site though pay-per-click ads.

The second comes from the NYT who headline, Web marketers fearful of fraud in pay per click ...

There is evidence that at least some scammers are clicking away at the ads, or having programs called hitbots or clickbots do it for them, with the knowledge that each click costs an advertiser money. Some of the troublemakers are disgruntled employees; some are companies trying to force competitors' ad spending up; some are even Web page operators who let search engines deliver ads to their sites and then collect a cut when people click on those ads.

Ad buyers worry that "click fraud" could become rampant, if unchecked - a development that could undermine confidence in the fastest-growing segment of Internet advertising.

and staci at PC asks ...

Does that mean it's prevalent or on the rise? I'm not sure anyone really knows how much click fraud is going on. But it is a matter for concern on a couple of fronts -- one, it's a sign of some backlash toward a hot commodity and could play a role in slowing growth or lowering projections; two, it's another reminder of how results can be manipulated. Inflation isn't an online-only phenomenon but automation and other aspects of online operation make it easier to perpetrate frauds.

This stuff has been going on for a looooong time, but with all the attention Search is getting these days, the SE's may just have to been seen publically doing something about it...

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About the Author:
Nick Wilson is the publisher and founder of Threadwatch.org.

Threadwatch is a group blog, or forum if you prefer, focusing on Marketing and Related Technologies - News and discussion for those that make their living on the WWW - Register here to participate.

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