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Web Startups Vie
To Detect 'Click Fraud'
By KEVIN J. DELANEY
Staff Reporter of The Wall Street Journal.
From The Wall Street Journal Online
To attract clients, Law Offices of James Sokolove, a firm based in Newton, Mass., spends more than $100,000 a month advertising on Web-search sites. But early this year, it decided Google Inc. and Yahoo Inc. weren't adequately addressing its suspicion that outsiders were maliciously clicking on its ads to drive up its search-ad bills.
So in March, the law firm hired Clicklab LLC, paying the 11-person McLean, Va., company hundreds of dollars a month to try to root out the problem. The law firm is among an increasing number of advertisers seeking help from a new set of companies that have popped up to tackle "click fraud," a term the industry uses to describe someone clicking on a Web-search ad with ill intent.
Like hundreds of thousands of other advertisers, the Sokolove firm contracts with Yahoo and Google to serve up small text ads to anyone searching the Web using certain words, such as "Vioxx" or "mesothelioma," a rare form of a好estos-linked cancer. The firm, which has affiliates throughout the country, pays the search companies a fee each time someone clicks on one of its ads. Amid heated bidding with other advertisers, primarily personal-injury law firms, for "mesothelioma," it paid around $100 a click last year.
The search-ad market is estimated at around $4 billion in the U.S. in 2004, and the vast majority of Google's revenue comes from search and similar keyword-triggered Web-site ads. But there is increasing evidence that some people are clicking on such ads either to run up fees for competitors, to boost the placement of their own ads or to make money for themselves.
The Web-search companies concede that click fraud is an issue but decline to quantify its scope; some outside estimates run as high as 20% of all clicks. Many companies complain that Google, Yahoo and other search engines are vague about how they are tackling the problem, unresponsive to questions about suspect clicks and ineffective when advertisers point out possible abuses.
E-magine Networks Inc., which spent about $500,000 on Google ads in the past 12 months, says it recently received about $15,000 in credits from Google for "invalid clicks." The Fort Lauderdale, Fla., Web-site operator believes click fraud has cost it more than that. So it recently had a start-up company called ClickFacts put some computer code on its Web sites to help track clicks.
Other advertisers have taken the issue to court. Lane's Gifts & Collectibles LLC, a Texarkana, Ark., retailer, in February filed suit in Miller County, Ark., circuit court against several search companies. The suit, which was joined by another advertiser, alleges that search companies knowingly charged for fraudulent clicks.
Sensing a business opportunity, entrepreneurs have built up a cottage industry to capitalize on search-advertiser discontent. Their services, with names such as Click Defense, ClickDetective and WhosClickingWho, generally monitor records of visitors who come to their clients' Web sites via search ads. To sniff out fraudsters, they rely on such clues as the numerical addresses that computers provide when they connect. Advertisers can take that information to the search companies to request credits to their ad budgets for fraudulent clicks.
"The market has certainly become flooded with people in this space," says Skip Pratt, general manager of PPCTrax.com, a unit of closely held Oliver Tucker Partners LLC. The Chandler, Ariz., Internet services and consulting company started its service to combat click fraud in January, after wrestling with the problem when it affected its own search advertising. It says it has about 35 clients.
Google and Yahoo acknowledge the miniboom in click-fraud services and say they are open to working with such third parties in attempting to address the issue. The information in advertisers' Web-site records "is useful to help them identify patterns," says John Slade, a senior director for product management at Yahoo's search-ad arm. He says Yahoo itself has considered providing Web-site traffic analysis similar to that offered by the third parties.
Both search companies decline to comment on specific customer complaints. "We take all incidents seriously and we make every effort to investigate each one quickly and communicate effectively with the customers," says Salar Kamangar, a Google product-management director.
Yahoo and Google each has its own complex system, honed over time, that aims to spot click fraud before an advertiser is charged. But, citing privacy issues and a desire not to alert fraudsters to the surveillance techniques, the search engines generally won't provide advertisers with details about how they handle specific suspect clicks. That can make it hard to reconcile analyses performed by third-party services with what clicks the advertiser paid for.
Advertisers on their own can monitor the effectiveness of their ads by using free services from the search companies that help determine what portion of clicks generates customer sales. They also can scour the records kept by their own Web servers. But small advertisers in particular often say they don't have the time or technical expertise to hunt for traces of click fraud with those tools.
Andrew Sweet, Web manager for the Sokolove law offices, says he tried poring over the company's Web logs but found it inefficient and inconclusive. Enter Clicklab. In evaluating each search-ad click, Clicklab examines over 30 factors, such as the country where the visitor appears to be located and the length of time spent on a client's site. Its service, inaugurated in March, starts at $100 a month.
Mr. Sweet says Clicklab's analysis suggests that only about 2% of the clicks on the law firm's search ads are fraudulent. Still, he believes the detection service is worth it, if only for peace of mind.
Scott Karr turned to a third-party service for similar reasons. The president of Karr Group First LLC, an online home-appraisal concern, suspects a competitor is clicking on his Google search ads to try to drain his ad budget. He recently estimated his total bill for fraudulent clicks was about $6,000. Google refunded the closely held Reynold好urg, Ohio, company $360 for "invalid clicks."
Mr. Karr says that when he discussed the matter with Google staff, they wouldn't say what else, if anything, Google is doing about his problem. So he signed up for WhosClickingWho in April, paying a $79 monthly fee. When someone clicks multiple times on the same search ad, the service displays on that person's screen a pop-up message indicating it is tracking him or her. It also provides detailed reports advertisers can use to request refunds from ad providers. Mr. Karr recently challenged Google's billing based on WhosClickingWho data. Google replied in an email that it didn't find evidence of click fraud and that there could be a problem with the third-party service's numbers. Mr. Karr says he's sticking with the service, but now has some doubts about its value.
WhosClickingWho is a service of closely held PPC Audit Inc., a 12-person Santa Clara, Calif., company. President John Carreras launched the service in 2002 after business rivals repeatedly clicked on search ads he bought for his trade-show display business. He says WhosClickingWho now has a few hundred customers. With click-fraud detection booming, he sold his trade-show business earlier this year.
Click-fraud detection has even spread to university campuses. Mikhail Ledvich, who is 20 years old and just completed his sophomore year at Boston University, is starting a service called ClickFacts with two other Russian-born college students during their school vacation this summer. A venture-capital group is providing financial backing and advice. |
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发表于 2005-6-13 22:47:25
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