Click FraudClick fraud has been around since the beginning of internet advertising and fraudster’s methods have become more advanced over the years, leading to sophisticated Battlestar Galactica-like internet bots that mimic human behavior with false clicks.

Whether you know it or not, your brand is shelling out money for clicks that did not come from humans, and the problem is endemic. In 2014, click fraud cost advertisers $11 billion and unfortunately, it is easier to get away with than cross checking in hockey, or late hits in football.

What is Click Fraud?

Click fraud is a method used by competitors who are frustrated with seeing a certain company’s ads appear above their own. By employing people (or bots) to commit click fraud on their behalf, their aim is to spend your daily budget before the day has even begun.On the other side there is the commission that advert display networks pay to website owners who allow advertising on their sites. In a just and fair world, they would be paid commission through natural clicks by their website’s visitors. But by using bots to collect data about the adverts, and then getting other bots to click on these adverts, a large amount of false revenue can be generated.

In both cases, this leaves the advertiser seeing loads of clicks but no conversions.

Preventing a Bot Invasion

Fraud bots are hard to detect because they look like real people, using real cookies and legitimate computers. The good news is that solutions exist that have the ability to detect and identify bad bots and block them from clicking on your ads.

3 critical ways you can you minimize the impact of click fraud?

Whilst it’s probable that fraudsters will always be one step ahead of the industry’s security brigade, measures can be taken to minimize the impact of online fraud:

1. Frequency caps on clicks

Ask the PPC company if they use frequency caps and what the cap is. A frequency cap or filter is a set of rules that will prevent duplicate clicks originating from the same IP address.

2. Limit daily click spends

Not many of us have unlimited budgets and we’ve heard all too often of ecommerce site owners investing thousands of dollars on a PPC campaign, only to find it totally depleted within a very short period of time. Only invest what you can afford to lose, and then bump it up slowly. And monitor it every day.

3. Country filtering

Think about your target market - do you really need coverage in North Africa for example? Bear in mind that a great deal of fraud has its roots in Eastern European, African and some Asian countries.

Topics: Click Fraud, Data Analytics, Online Advertising, Bot Traffic

Tim Nichols

Written by Tim Nichols

Tim Nichols is a founding partner at ExactDrive, a digital media buying agency with white label, reseller and managed service options available. ExactDrive plans, manages, and optimizes online advertising campaigns with the objective of delivering measurable value and empowering clients to find precisely targeted audiences. ExactDrive has offices in Minneapolis, MN and Milwaukee, WI.

Tim Nichols is also a contributing author on Forbes.com.