5 Things You Need to Know About Click Fraud

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By Boris Dzhingarov

Click fraud is one of the many methods that modern cybercriminals can use to defraud advertisers. It is also a means by which an unscrupulous business can cause harm to their competitors in relative anonymity.

If you plan on launching a website and are serious about monetizing it, here are five things you need to know about click fraud first.

The Bots Are Taking Over

Many cybersecurity professionals have noted the ever-increasing prevalence of bots being used in the perpetration of cybercrime. In recent years, we have seen a dramatic uptick in the number and sophistication of bots that are used to produce fraudulent clicks to defraud advertisers.

Until recently, these bots were relatively easy to detect. However, this is no longer the case. Savvy cybercriminals have added both artificial intelligence and machine learning into the mix. With both of these on their side, the criminals have been able to develop bots that are all but indistinguishable from a regular human user.

Not only is the increasing use of bots bringing a fresh set of challenges to ad verifiers looking to combat click fraud, but it is also proving increasingly difficult to trace these bots back to a specific source. Some estimates now suggest that as many as 20% of all websites and adverts clicked on are clicked by bots rather than people. In fact, many cybersecurity professionals consider this to be a conservative estimate and the problem may be even more significant.

As the number of VPN users has steadily increased over the last decade or so, ad verifiers have noticed a corresponding increase in the difficulty of tracing bots back to their source.

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There’s No Accounting For Friendly Fire

Ad verifiers have devised a number of methods for establishing whether an interaction with an online advert is legitimate or not. However, this is much easier said than done. As we mentioned earlier, artificial intelligence and machine learning have enabled the creation of bots that behave in a much more human-like manner than anything that has come before. By mimicking the imperfections and idiosyncrasies that distinguish a human using a computer from a machine that moves with perfect precision, bot makers have made it significantly more difficult to detect their scripts.

Part of the problem that verification services have when it comes to separating real clicks from fake clicks is that there is also a middle ground that needs to be accounted for. This middle ground is known as the friendly fire group, users who, unintentionally, and in many cases unknowingly, click on an advert. Now that touch screen devices are so ubiquitous, the rates of friendly fire clicks have increased dramatically.

Criminals Are Making A Killing

Many people are stunned to discover that the ad fraud market is worth billions of dollars every year. Over the last few years, estimates for the total amount of money that advertisers have lost due to click fraud have skyrocketed. By the end of 2016, it was estimated that advertises had lost a little over $7 billion dollars to click fraud over the course of the year. However, by the end of 2017, this number had risen dramatically to $16.7 billion, and 2018 saw the figure rise above $27 billion.

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Needless to say, with so much money on the line there is plenty of incentive for businesses to fight back against click fraud, while there is also, unfortunately, a significant incentive for criminals to engage in the activity. Despite the mounting efforts to curtail online advertising fraud, the rate at which money is being lost is increasing exponentially and showing no signs of slowing. It is only in recent years with access to better analytical tools that we have been able to establish precise figures for the scale of the fraud, but many were taken aback by just how widespread the problem is.

Ad Verifiers Are Fighting Back

Add verifiers are fighting back against the click fraud and other forms of advertising fraud in a number of different ways. For example, if a website notices a sudden and unexpected spike in activity, this can often be indicative of malicious activity. Just as people have in previous years turned to DDOS attacks to bring down websites and online services, malicious actors today are using bots to click on content thousands of times. At best, this can significantly skew a website’s statistics, and at worst can cause them a significant amount of financial harm.

Analyzing and tracking IP addresses is also a common tactic, but one that is becoming less effective as VPNs and proxies become more prevalent. It is now so easy for anyone to disguise their IP address and location that trying to prevent click fraud via IP bans is a fool’s errand.

Fortunately, ad verifiers combating click fraud have Google on their side. Google’s artificial intelligence and machine learning capabilities mean that they have some serious weaponry when it comes to fighting back against click fraud. While Google’s defenses are still far from perfect, it is likely that any eventual solution will depend upon the evolution of these technologies.

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The Majority Of Click Fraud Is Directed By Competitors

While cybercriminals have been known to use click fraud as part of their wider effort to defraud advertisers, they are not the main suspects when it comes to click fraud specifically. In fact, the majority of click fraud is directed by competitors. Other businesses that are competing with your own can benefit from abusing your pay-per-click advertising by using a large number of fraudulent clicks to rack up a large bill in your name.

By having a bot or script continually click on a competitor’s advert, it could, in theory, drain their rival’s daily budget relatively quickly. Small businesses may well put a limit in place that tells Google when they want to stop spending money. However, businesses that have not put such a limit in place and are victims of click fraud can end up faced with an enormous bill at the end of it.

Click fraud is a serious problem and one that isn’t going away anytime soon. Any business that utilizes PPC advertising needs to be aware of click fraud and needs a strategy for combatting it.