Click fraud is a widespread issue in digital advertising, with estimates suggesting it costs advertisers billions of dollars annually. For almost as long as there have been pay-per-clicks (PPC), there has been click fraud, costing every business’s marketing budget that is supposed to go toward reaching the target audience. Every business must be cautious to avoid fraudsters seeking to exploit the pay-per-click or lead-gen system. These are the basics of what you need to know about click fraud.
- What is click fraud?
- How is click fraud used?
- How do you commit click fraud?
- Why are you being targeted for click fraud?
- How do you spot click fraud?
- What do you do if you discover click fraud?
- How do you stop click fraud?
What Is Click Fraud? Is It Legal?
Click fraud refers to the practice of artificially increasing the number of clicks on an online ad by using automated software or fake clicks from fake websites. This can be done to fool businesses into paying for invalid clicks or artificially inflate numbers making the site or app appear more popular than it is (to whatever means). Either way, intentionally committing click fraud, while not explicitly illegal, can be prosecuted under other laws related to wire fraud, data theft, deceptive business practices or even money laundering.
How Is Click Fraud Used?
Click fraud is used by fraudsters to either make money or manipulate how others spend their money. Regardless of their motivation, the impact on businesses can be substantial. The most common form of click fraud is in affiliate marketing where invalid traffic is sent in exchange for affiliate marketing dollars.
- Ad fraud profits – Fraudsters can inflate numbers in any part of the PPC process to increase their own profits.
- Harming competitors – Competing companies could target PPC ad campaigns to deplete marketing funds.
- Manipulating traffic – Boosting click-through rates will give the false impression that something is legitimately popular to anyone monitoring the traffic.
How Do You Commit Click Fraud?
Unfortunately, there’s no one way to commit click fraud – several different techniques and technologies are available to fraudsters. The most common include:
- Automated bots and scripts – Automated programs to generate large volumes of fake clicks on ads. These bots can mimic human behavior and use techniques like IP spoofing and VPNs to avoid detection.
- Click farms – Large groups of people are paid to manually click on ads or links. There are also automated click farms using networked devices to generate fake clicks.
- Botnets – Networks of infected computers controlled remotely by cybercriminals to generate fraudulent clicks without the device owners’ knowledge.
- Pixel stuffing – Placing tiny, invisible 1×1 pixel ads on websites that register as impressions or clicks without being visible.
- Malicious clicks – Typically done by competitors, deliberately clicking on ads to exhaust an ad budget.
- Invisible ads – Displaying ads that aren’t visible to real users but still register views/clicks with ad stacking or ad placement offscreen.
- Click hijacking – Also known as clickjacking, tricks users into clicking on hidden or disguised elements that trigger an ad.
Combining these methods with IP proxies and geo-masking allows fraudsters to create sophisticated click fraud tools making them challenging to detect and prevent. Additionally, fraudsters continually adapt their techniques to evade detection systems.
Why Are You a Target Of Click Fraud?
It’s important to note that being targeted for click fraud doesn’t necessarily mean you’ve done anything wrong. It could be a fraudster testing out a new click fraud technique or done on behalf of a malicious actor you have no control over. If you find yourself the target of consistent click fraud, you may have one of the following risk factors working against you.
- Industry norms – Some industries have higher rates of click fraud than others. The top five industries with the most click fraud include:
- Finance/insurance
- Real estate
- Legal services
- Health/medical
- Ecommerce/retail
- Level of competition – If you’re bidding on expensive keywords with high amounts of visibility, you may be more likely to be targeted as fraudsters can drain your budget more quickly and have more to gain from taking over that pixel space in front of consumers.
- Lack of protection – If you’re not using click fraud prevention software or closely monitoring your ad traffic, you may be an easier target.
How Do You Spot Click Fraud?
Data and tools to handle the data will always be your best way to spot click fraud, the first step in stopping click fraud. You’ll want a good grasp on your analytics to be able to monitor user behavior and cross-check that with performance data while possibly utilizing fraud detection tools. More simply, you’re looking for anomalies in performance, either against expectations or historical averages, and looking into those further to see if you can identify patterns that reveal systemic fraud.
Monitor User Behavior
- Bounce rates – Compare bounce rates between PPC and organic traffic for the same landing pages. A significantly higher bounce rate for PPC traffic may indicate click fraud. Look for if clicks greatly outpaces visits – could mean bots are bouncing before the load.
- Click-through rates (CTR) – Look for unusually high CTRs compared to industry averages or your historical data.
- Time on site/pages per visit – Low averages for indicators of user engagement like time and further clicks could indicate click fraud occurring.
Review Ad Performance Data
- Conversion rates – Compare conversion rates across campaigns and historical performance and look for spikes or increases. If one campaign has a much higher conversion rate but lower overall conversion value, it could indicate fraudulent conversion actions.
- Traffic data – Check for consistency or trends developing in your traffic data and review the available demographic data on the traffic. Look for sudden increases in ad spend or clicks without corresponding increases in conversions or engagement metrics.
Use Click Fraud Detection Tools
- Detection software – Consider implementing specialized software that detects bot activity on your site or platform. Ideally, this solution would be real-time to deal with emerging threats.
- Monitor IP Addresses & Patterns – Tools can help identify repeated clicks from the same IP addresses, geographic locations or devices.
What Do You Do If You Discover Click Fraud?
If you suspect you’re click fraud is occurring in your digital campaigns your course of action is determined by where you suspect the fraud is coming from, the amount of fraud and the platform it’s occurring on. These are a few things you should immediately consider:
- Use platform-provided tools – Your ad platform should have some type of fraud reporting tool or protocol to follow. Make sure you have your documentation ready in case it’s needed and immediately reach out to the platform
- Adjust campaign spending – Stop or tamp down spending in campaigns that may have fraudulent clicks associated with them.
- Adjust IP settings – If possible, upload a blocklist of IPs you know to be participating in click fraud.
- Consider legal action – In severe cases, legal action or criminal charges may be involved, consult an attorney if you suspect this to be the case.
How Do You Prevent Click Fraud From Happening?
While click fraud can seem unavoidable, there are ways you can prevent losses to click fraud. Aside from closely monitoring your ad traffic for suspicious patterns to identify fraud in the first place, there are a few proactive things you can do to prevent it from ever happening.
Use Click Fraud Prevention Measures
You can stop fraudsters from visiting your site or lessen the impact they may have by using tools designed to prevent click fraud in the first place. These include things like:
- IP blocklists – You can stop fraudsters from visiting your site in the first place by implementing an IP blocklist that rejects traffic from particular addresses.
- IP risk scoring – Evaluate how safe or risky a visitor might be based on an IP address’s historic behavior and then treat them accordingly.
- Updated IP data – IP blocklists and risk scoring only work if the data is continually updated to reflect the new IP addresses that are suspect.
Evaluate Ad Networks/Platforms On Fraud Prevention
Some ad networks or platforms do a better job at preventing or handling fraud once it happens. Look for ad partners that can offer things like:
- Click quality filters – Automated systems filter out invalid clicks before advertisers are charged.
- Manual reviews – Suspicious activity flagged by automated systems is manually reviewed.
- Collaboration with advertisers – Platforms work with advertisers to investigate potential fraud cases reported by them.
- Third-party verification – Some platforms work with independent third-party fraud prevention companies to audit traffic and verify its authenticity.
Look into things like the company policies on fraud and how they work with advertisers on the platform if and when fraud occurs.
Click fraud is a growing threat to digital advertisers and requires their attention. With the increasing sophistication of fraudsters, it’s essential for advertisers to be proactive in protecting themselves. By taking the necessary steps, they can ensure that their ad spend is being used effectively to reach their target audience and not being wasted on fraudulent clicks.