Internet ‘Click Fraud.’

When Mice Attack–Internet scammers steal money with ‘click fraud’ (Newsweek)

Assaf Nehoray’s online ad campaign bogged down in Germany. The European businessman runs a Web marketplace for cargo firms; for the last two years he has attracted customers to his site by putting ad links on the major search engines. The model worked perfectly—until last summer. When he tried to expand into Germany, Nehoray found that his site was getting lots of new visitors but unusually few paying customers. Nehoray (who prefers we don’t name his company) analyzed his Internet logs and made an unsettling discovery. Someone—perhaps a competitor—had written a simple software program that relentlessly clicked on his ads, burning up his ad budget and pushing his links off the search sites by lunchtime each day. After spending weeks complaining to Google about the problem and getting a partial refund, he finally yanked the ads. “It was really bad,” he says, estimating that he lost $50,000 in potential business. “Nobody knows how to solve this problem.”

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Last month Google CFO George Reyes conceded that click fraud was a significant threat to his firm’s burgeoning bottom line. “I think something has to be done about this really, really quickly, because I think, potentially, it threatens our business model,” he told an investors’ conference.

Such fraud is indeed lousy and something that’s potentially of serious consequence to small entrepreneurs who use such advertisements as well as to the provider companies. The irony, though, is that this is a double blind business. Google and other sites zealously safeguard their business secrets, even to the point of making it a violation of their terms of service for people to disclose how much money they make a month from their GoogleAdsense strips. Their system is far from transparent: Google tells me how much I earn a day and from how many clicks but gives me no indication of what keywords were clicked, on what pages, and so forth. Apparently, it’s blind on their end as well.

In the last few months, I’ve noticed an increasing number of bogus sites showing up in my referral logs. These were sites clearly not linking to me but nonetheless showing up with 100-odd “referrals” apiece. I wonder if that is a function of click fraudbots hitting my GoogleAds or something else entirely.

Via Les Jones, who links an interesting discussion of the subject at Slashdot.

FILED UNDER: Economics and Business, Science & Technology
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Zed says:

    I’ve got bogus sites on my logs as well, I hate it, I did some research and read that it is a robot spam program, the same which fills your comments with tons of “deep thoughts” or porn. I’d love to know how to stop it.