Pay-per-click (PPC) advertising is a legitimate tool that digital marketers use to help their clients reach their target audiences. Like any digital marketing tool, PPC advertising has its limits. One such limit is its propensity for fraud. Unfortunately, PPC fraud is big business. It is big business that is capable of killing any company’s marketing budget.
Not only is PPC fraud unethical and criminal, but it also costs publishers money. Publishers spend on what they believe are legitimate clicks on their PPC ads. But because those clicks are not legitimate, each one represents money down the drain.
How big a problem is PPC fraud? According to a 2016 report from the Wall Street Journal, more than 20% of all ad impressions from chrome browsers were generated by non-human sources. There’s little reason to believe such fraud has abated in the years since.
How It’s Supposed to Work
PPC advertising is not hard to understand. A publisher bids on certain keywords that will be used in their ads. Let’s say a publisher wins a bid at $0.25. The publisher creates and publishes ads with the desired keyword. Every time someone clicks an ad, the publisher is charged $0.25. Nothing is charged if the ad gets no clicks.
When PPC advertising works as it is supposed to, publishers buy ads in one of two ways: directly from first-party ad networks like Google AdSense, or through third-party ad networks that place ads on a variety of websites, in mobile apps, etc.
The first-party ad networks are pretty trustworthy for the most part. It’s the third-party networks publishers need to be careful of. These are the networks most likely to utilize tools like click farming, click bots, fake leads, etc.
How Fraud Is Perpetrated
PPC fraud can be pulled off in a variety of creative ways. Regardless of the method used, the goal is the same: to charge publishers for clicks despite those clicks not coming from legitimate users interested in buying products and services. Fraudsters are essentially charging for ads they know will not accomplish anything.
Fraud Blocker, a California company whose software products include fraud protection software, highlights some of the methods for perpetrating PPC fraud on their website. Here are just a few examples:
1. Pixel Stuffing
Fraudsters can put their ads on websites and in apps utilizing very small areas no bigger than 1×1 pixel. The ads cannot actually be seen by visitors. However, every time the page is loaded into a browser or phone, it registers as a hit for the ad. The publisher is then charged for that hit.
This particular form of PPC fraud is especially egregious because the fraudster isn’t just failing to deliver genuine PPC results, he is going the extra step to purposely defraud by designing ads that will never be seen.
2. Add Stacking
Add stacking is a cousin to pixel stuffing. When a fraudster stacks ads, he places multiple ads on top of one another in the same space. They are too small to see. Just as with pixel stuffing, every page load represents a hit on each ad. With this particular method, a fraudster can target multiple publishers on the same site or through the same mobile app.
3. Click Farms
Fraud Blocker says the most widespread form of PPC fraud is the click farm. A click farm is essentially a company that hires people to do nothing but click on ads all day long. Fraud Blocker says these sorts of companies prefer to set up shop in countries where labor is extremely cheap.
Knowing that companies utilize sophisticated algorithms to detect fraud, click farms need to equip their employees with the knowledge and skills required to remain undetected. It ends up being a cat and mouse game between the click farms and companies whose software is designed to find them.
4. Fake Views
Even videos can be subject to fraud. Consider that the most popular video platforms charge for advertising. They rely on actual views to determine their rates. It turns out that fraudsters can do the same thing with videos as they do with click farms. They can utilize hired employees or software bots to routinely play videos without actually watching them.
5. Click Bots
Perhaps the most egregious form of PPC fraud is the use of click bots. Click bots are a form of malware that fraudsters install on user devices without their knowledge. The bots then run in the background, going to the fraudster’s websites and apps, and clicking on ads that will never be seen. Fraud Blocker says it is possible for a single click bot to infect millions of devices before being discovered – if it’s discovered at all.
What Publishers Can Do
By now you are probably wondering what publishers can do to defend themselves against PPC fraud. Unfortunately, fraudsters are particularly good at what they do. They are also highly adaptable. Every time an organization comes up with a way to defend against them, they develop a workaround.
Nonetheless, there are things publishers can do. First and foremost is to be cautious about their chosen ad networks. PPC advertising budgets should be devoted to reliable first-party networks whenever possible. Should a publisher decide to go with a third-party network, plenty of research into that company is warranted.
Second, publishers can invest in fraud protection software. A well-designed platform can detect all sorts of fraud through constant monitoring and analysis. Not all fraud protection software is the same, so plenty of research is called for here as well.
Pay-per-click advertising is a common tool used by publishers to reach their customers. It is the digital equivalent of placing ads in newspapers and on TV. When it works, it tends to work very well. But it is subject to fraud. If you plan to use PPC advertising as part of your overall digital marketing strategy, keep your eyes open for PPC fraud. If you suspect fraud is happening, you have every right to demand that your ad network provider justify its charges.