Google Says Click Fraud Less than 2%

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Andy Beal’s Marketing Pilgrim has an exclusive story running that Google AdWords Click Fraud is at or below 2% and that Google has the proof. Andy’s post is incredibly detailed as he runs through Google’s Four Layers of Click Fraud Filters:

Google’s Click Fraud Rate is Less than 2%

Google utilizes four layers of click fraud detection. The first layer is purely automatic and is used to filter clicks from both “search” and AdSense partners (contextual ads). This filter is able to detect invalid clicks in real-time, with the goal of removing them before they ever show up in the AdWords console.

The second and third layers are aimed at filtering only AdSense clicks. The second layer is what Google calls its “flagging system” and is an automatic process to remove invalid clicks from the AdWords system. The third layer of filtering is a “manual review” process with more than two dozen Google employees manually reviewing and removing any suspicious clicks.

Google’s goal is to have the first three layers of filtering identify 100% of all invalid and fraudulent clicks. Those clicks that manage to escape Google’s filters are what causes many advertisers to raise concerns and has spawned the growth of many so-called click fraud detection companies. The fourth layer of click fraud detection falls to these advertisers and detection companies and is what Google calls “requested investigations”.

So, in Q3 of 2006 Google AdWords brought in $2.69 Billion in revenue, does this mean that there was somewhere around $50,000,000 in click fraud committed in Q3 2006 alone?

Loren Baker
Loren Baker is the Founder of SEJ, an Advisor at Alpha Brand Media and runs Foundation Digital, a digital marketing strategy & development agency.
Loren Baker
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  • Michael Martinez

    It’s a good article but, as I explained in my comment over there, the presentation doesn’t go far enough in clearing the board of issues.

    Google has yet to acknowledge that it has tackled the problem of distributed proxy networks, much less explained how it attempts to block them.

  • Loren Baker, Editor

    “Google has yet to acknowledge that it has tackled the problem of distributed proxy networks, much less explained how it attempts to block them.”

    Yes, a little bluebird is telling me that they’ll have more explaining to do about these issues as the week winds down.

  • Loren Baker, Editor

    Some explanation, and the look into their click fraud system, is however a positive start 🙂

  • cvos

    I think Google is intentionally leaving this data vague by only sharing AGGRAGATE click fraud data. I believe the majority of click fraud occurs in the content network and on adsense sites.

    Click fraud on Google search is likely very low, since there is no monetary incentive.

    However, there is a huge incentive to falisify clicks on your own adsense website, and this is where Google’s numbers lie.

  • Bashar Abdullah

    As much as I admire what Google does, but 2 out of every 100 advertiser suffering from click fraud is not a low percentage is it?

  • Michael Temple

    I suppose if I was collecting more than 2 billion dollars per quarter in revenue and had multiple stories hitting the press about fraud I would be a bit sensitive as well.

    However another problem here is there filters (accept for employee review) is based around stopping automated click fraud. What about the click fraud that occurs on a smaller scale, i.e. I allow several ads on my site and notify my reader base to please click on the ads on my site or I give them an incentive (free book) to click on them? These would happen in patterns and amounts that would look random and *appear* to most filters to be “real” clicks, when in fact these people aren’t real prospects. Such fraud is virtually undetectable and very difficult to eliminate. Add such fraud to an aggregate level and you still have a fundamental problem.

    Google as do other pay to click models need to start charging fees on a performance measure rather than an action measure such as actual sales or conversitions. If they only collected revenue when someone bought the problem would not exist. I realize this is unlikely to occur as it does not even occur in mainstream advertising, but if we meet somewhere in the middle click fraud problems will become less of an issue.