Click Fraud is not bad as you might think?

Posted on 26th April, 2006

ClickFraudIndex.com which is backed by click fraud auditing company Click Forensics has recently published a finding that says click fraud that inflates the cost of online advertising is actually lower than expected.

The average click fraud rate across the industries is 13.7 percent which is much lower than what the industry had expected which was 20 percent to 35 percent.

Click Forensics also reported that click fraud on tier one search providers such as Google and Yahoo was 12.1 percent, which was far less on tier two (21.2 percent) or tier three (29.8 percent) providers.

The problem with this data is that it comes from a limited pool of advertisers who are part of the Click Fraud Network. This figure alone is not enough to represent the entire state of the industry.

Danny Sullivan points out in his blog:

The big caveat to keep in mind is that this rate only takes into account data from those who are part of the Click Fraud Network, which is backed by click fraud auditing company Click Forensics. The company does say this one the Click Fraud Index page, but despite this, some might assume the figures represent an industry-wide estimate.

The company says it has hundreds of advertisers enrolled, but who exactly these are isn’t listed. If many advertisers are in competitive, high risk areas, that could potentially drive click fraud rates higher than the industry norm (whatever that is — no one really agrees on a figure). Or it could drive the figure lower, depending on the make-up. But without having a good breakdown of the network, it’s hard to take this figure alone as proof of the state of the entire industry.

In response to that Tom Cuthbert, president and CEO of Click Forensics emailed to provide some explanations.

The company claims to have more than 400 advertisers using its service. Apparently more than 90 percent of click fraud originated within the United States and Canada. Outside those two countries, China and France were the biggest originators of click fraud.

Read more: Click Fraud is not bad as you might think?

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