Google's Click Fraud Problem - Part 2

We saw what is click fraud and who does it in the first part of this article series. Disgruntled employees can click on their company ads to vent out their anger. Unsatisfied angry customers could do it to take revenge on any company. Why is click fraud important? It is very important because it causes loss of revenue to the advertiser. The advertiser does not get expected results from his ad campaign and may refrain from using adwords next time. This may in turn harm google. The 2 techniques of doing click fraud are manual and automated. Either some one can sit on his pc and start clicking anyone's ad randomly or someone may use an automatic bot to click on ads again and again. One can do it to harm the competition. Political activists can do it to harm another party's campaign or against any company.

What Is Google Doing?
Google has a click quality team to maintain quality control over the adsense and adwords programs. They ask advertisers to report click fraud if they feel it is happening and also submit data from their server logs. Internet Protocol (IP) address exclusion can be done so that users from a particular IP are not able to see the ads. Invalid click reporting from both ends can be done. Google can also inform advertisers if they find out that the fraud is taking place so that the advertiser can also take necessary steps. They sometimes offer refunds to advertisers so that they remain happy and feel safe about their investment in advertising.

My Recommendations
Cost per action type of ads can be used by google to reduce the problem. Only if someone performs some action after a click, will the advertiser be charged for the ad. There can be more transparency between Google & advertisers. Google can do development of more sophisticated tools to track fraud. They should report fraudulent IPs to service providers so that people are discouraged to indulge in mischief. They could measure duration of each click-visit to verify if it is genuine or not. Lastly, they should take legal action on the fraudsters and set an example.