Click Fraud Research

We define the term "click fraud" as the practice of clicking on paid advertising links to either (1) harm a competitor, or (2) make money by "forging" clicks on web sites that show ads through content syndication. We use the term "fraud" when advertisers lose money by paying the search marketing firm (anywhere from a few cents to over $50) for each click without receiving any value. People engaged in performing the clicks have no interest in the product or service, but are simply motivated to make money by cheating advertisers.

At Click True we distinguish between various types of clicks depending on the source. Fraudulent clicks are clicks that you receive from sites that are developed for the sole purpose of generating revenue from content syndication networks such as Google's AdSense network. These are sometimes called "click farms" since they can generate a large amount of fraudulent traffic via a large group of individuals or programs designed to click on ads.

Another group of clicks that advertisers should be aware of are what we call "low value" clicks. We define these as clicks that come from sites that are not related to your business or the keywords you are using. Examples of these include community sites driven by users (such as youtube.com) and parked domains. These sites can also generate a large amount of traffic with very low or no conversion rate. Click True monitors both categories of low-value clicks.

Click fraud is clearly a large and growing problem, but nobody knows just how big. In 2006, both Google and Yahoo lost class-action lawsuits for allowing click fraud on their advertising networks. Estimates range from a little as 2% to over 25%, depending on the source. Our research and the experience of other advertisers suggest that the real number is anywhere from 10% to 25%, and depends very much on the keywords used within the online advertising.

Unfortunately, the organizations that are in the best position to know the real percentages are not encouraged to advertise these numbers. Advertising networks such as Google, Yahoo, MSN and others make over $8 billion annually in pay-per-click revenue.

For more information, visit our click fraud frequently asked questions.