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Should we still worry about click fraud?

I find that most search marketers don’t know what to make of click fraud. They’ve heard the stories, but they have no idea whether it’s happening to them. It’s human nature to put risks out of our minds when we don’t know how to respond to them. Is that a safe way to deal with click fraud?


If you’re one of those with your head in the sand, start by understanding what you’re missing. Click fraud probably occurs more than you think—some estimates have placed click fraud at 20% of all paid search clicks. Click fraud is being contested in court. And click fraud has been the subject of scary insider stories that would give any search marketer pause.
I started thinking about click fraud again, when Forensics found a 14% click fraud rate in a recent study. But as that Search Engine Land article correctly points out, that 14% rate is the total fraud rate—not the amount that a search marketer pays. Search engines aggressively identify occurrences of click fraud and do not charge search marketers for those suspicious clicks. In fact, some reports say that click fraud’s cost to search marketers is around 2%.
So what does this all mean to search marketers?
I recommend thinking of click fraud as a cost of doing business, much like shrinkage in a retail store. Few retailers go out of business because of shoplifting, and click fraud is unlikely to doom your paid search campaigns. Focus on your return on investment, such as Lifetime Value calculations. If your campaigns are providing a sufficient return on investment, then don’t worry about whether a small part of your investment was actually wasted on click fraud.
It’s rare, but sometime ignoring a problem really can be OK.

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Mike Moran

Mike Moran is an expert in digital marketing, search technology, social media, text analytics, web personalization, and web metrics, who, as a Certified Speaking Professional, regularly makes speaking appearances. Mike’s previous appearances include keynote speaking appearances worldwide. Mike serves as a senior strategist for Converseon, an AI powered consumer intelligence technology and consulting firm. He is also a senior strategist for SoloSegment, a marketing automation software solutions and services firm. Mike also serves as a member of the Board of Directors of SEMPO. Mike spent 30 years at IBM, rising to Distinguished Engineer, an executive-level technical position. Mike held various roles in his IBM career, including eight years at IBM’s customer-facing website, ibm.com, most recently as the Manager of ibm.com Web Experience, where he led 65 information architects, web designers, webmasters, programmers, and technical architects around the world. Mike's newest book is Outside-In Marketing with world-renowned author James Mathewson. He is co-author of the best-selling Search Engine Marketing, Inc. (with fellow search marketing expert Bill Hunt), now in its Third Edition. Mike is also the author of the acclaimed internet marketing book, Do It Wrong Quickly: How the Web Changes the Old Marketing Rules, named one of best business books of 2007 by the Miami Herald. Mike founded and writes for Biznology® and writes regularly for other blogs. In addition to Mike’s broad technical background, he holds an Advanced Certificate in Market Management Practice from the Royal UK Charter Institute of Marketing and is a Visiting Lecturer at the University of Virginia’s Darden School of Business. He also teaches at Rutgers Business School. He is a Senior Fellow at the Society for New Communications Research. Mike worked at ibm.com from 1998 through 2006, pioneering IBM’s successful search marketing program. IBM’s website of over two million pages was a classic “big company” website that has traditionally been difficult to optimize for search marketing. Mike, working with Bill Hunt, developed a strategy for search engine marketing that works for any business, large or small. Moran and Hunt spearheaded IBM’s content improvement that has resulted in dramatic gains in traffic from Google and other internet portals.

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