Just as injuries are a part of sports, click fraud is an unfortunate part of the PPC game. You can take all the precautions to eliminate the issue, but click fraud happens. The question is — how bad is the issue? There has been some press about this lately, and I believe there is some overreaction.
According to Click Forensics, a company that specializes in monitoring and preventing internet crime, click fraud rates are at a two-year high. The industry click fraud rate for the last quarter of 2008 was 17.1% versus 16.6% a year earlier. At first glance, these numbers do seem alarming. What isnt factored into that 17.1% are the invalid clicks that are discounted by most search engines.
Google, Yahoo, and MSN have safeguards in place to indentify and filter out invalid clicks, and have recently stepped up their efforts to control click fraud. For instance with Google, in most cases these fraudulent clicks are filtered out before they are even reported in the AdWords interface to advertisers. Google utilizes 4 layers of click fraud filters, and claims that their click fraud rate is on average less than 2%. Yahoo has stated that on average between 12-15% of clicks are filtered out due to being fraudulent or invalid.
Bottom line: It’s important to be aware that click fraud is a reality, but as advertisers you can feel confident that the search engines are taking the issue seriously and doing a good job identifying and filtering out these invalid clicks.