Click Fraud Reaches Historic High: 6 Ways to Prevent It

Marketers in the U.S. may wonder what in the world bauxite mining efforts in Vietnam have to do with their online efforts. Plenty, according to a new click fraud report from Mountain View, Calif.-based Anchor Intelligence. The click fraud and traffic quality solutions provider says “invalid traffic” reached a historic high worldwide during the first quarter of 2010, thanks in part to alleged efforts to squelch political dissenters opposing proposed bauxite mining in Vietnam. (Malware aimed at Vietnamese-language speakers compromises their machines, making the computers vulnerable to cybercriminals who then perpetrate denial of service attacks, spam campaigns and click fraud, according to Anchor.)

From January through March 2010, attempted click fraud reached 29 percent across Anchor’s network of search engine, ad network and advertiser customers, according to the Anchor Intelligence Traffic Quality Report: Q1 2010. Innocuous invalid traffic, which can include consumers double-clicking on ads, totaled 7 percent. The resulting 36 percent “is the highest invalid rate recorded by Anchor Intelligence since the company began publishing traffic quality across its network last year.”

U.S. customers saw an attempted click fraud rate of 35 percent and innocuous invalids were 5.6 percent; Canada’s rates reached 30.4 percent and 2.9 percent, respectively.

Anchor found the main sources of the attempted click fraud: New customers entered the network with higher-than-average attempted click fraud rates; and the scale and volume of botnets increased.

One of the botnets, for instance, was disguised as a Vietnamese language keyboard driver for Windows users. (The Anchor report cites Google and McAfee, which confirm this.

Anchor notes that machines compromised by malware that is designed for denial of service attacks “are also commonly used in other nefarious online activity, such as committing click fraud and distributing e-mail spam.”

The study concludes: “Until the international community steps up its efforts to counter the proliferation of malware, click fraud and botnets will remain a threat to global advertisers.”

Anchor provides Target Marketing Tipline with the following suggestions regarding how marketers can address the problem:

1. Prevent competitive click fraud. Search your keywords online to compile a list of competitors. Ping each competitor’s domain to determine the IP addresses associated with that company. If the IPs are registered to the company, and not the hosting provider, add them to your account IP exclusion lists (when available).

2. Use location targeting. If you do not sell products outside of the United States, be sure to target your ads to the United States. If you do sell products abroad, monitor the performance of your internationally targeted ads. If you find that your ads perform poorly in certain locations, remove those cities/countries from your targeting preferences accordingly.

3. Watch for anomalies in campaign performance. Monitor and analyze your reports to identify sudden, suspicious peaks in your daily traffic and costs. If the peaks do not correspond to improved performance and you cannot ascertain the cause, consider either stopping your campaign or asking the ad network to investigate the issue.

4. Watch high-dollar cost-per-click terms closely. Keywords with high CPCs are more likely culprits for click fraud than those with low CPCs. So pay particular attention to your high CPC keywords and the referrers that generate high volumes of traffic to your site through these keywords. If you fail to see a positive ROI for specific keywords, consider reallocating your spend away from those keywords in favor of higher-performing keywords.

5. Block low-converting referrers. Review referral and conversion information within your reports and analytics to see which referrers drive high volumes of ad traffic and which fail to drive conversions. If you notice that your ads/keywords are performing poorly on particular sites, reduce your bids for those publishers. If you notice any high-volume sites that don’t generate any conversions, selectively use the domain-blocking feature to prevent your ads from appearing on those sites in the future.

Heather Fletcher is senior content editor with Target Marketing.