Google Says Worries About Click Fraud Are Overblown
Wednesday, August 9, 2006
Google Inc. released a report yesterday criticizing independent consultants and researchers who have raised questions about click fraud, a growing concern of online advertisers worried that they are being overcharged for illegitimate clicks on their ads.
Google and other Web sites that host Google ads are paid when Internet users click on them. Automated "click robots" repeatedly click on Web ads to fraudulently inflate the amount of money an advertiser pays.
According to a report in June by Outsell Inc., 27 percent of advertisers surveyed said they had reduced online ad spending because they could not be sure that the clicks were from authentic users. The June report estimated that $1.3 billion in pay-per-click revenue from Google, Microsoft Corp. and Yahoo Inc. is related to click fraud and that 14.6 percent of all clicks are fraudulent.
Google disputed those figures but declined to provide its own estimates.
Google said reports about click fraud have exaggerated the problem and could scare away advertisers. In its report yesterday, the company attacked the methodology used and conclusions drawn by click-fraud consultants, arguing they either lacked the technology to differentiate between a fraudulent click and a Web page reloading or that their technology improperly counted a single click as multiple clicks. Google cited specific examples of such methodological problems.
The reports "have led to vastly inflated estimates" of the problem, said Shuman Ghosemajumder, Google's product manager of trust and safety. "We saw media reports and data from consultants submitted by advertisers and it didn't make any sense. This report details the flaws and explains the discrepancy. We want to help consulting firms."
Ghosemajumder said Google had taken steps to develop industry-wide standards to identify, quantify and define click fraud.
Google, Yahoo, Microsoft and Ask.com said last week that they would work on such standards over the next year through the Interactive Advertising Board, an industry group. Google recently launched a feature for advertisers to see how many invalid clicks Google has detected, but Ghosemajumder said the company would not make that aggregate information public.
"We think the most important thing is how it affects advertisers," Ghosemajumder said. "We don't want to provide any information to help the bad guys."
Research and click-fraud consulting firms criticized in Google's report said they stood behind their results and were encouraged that the company was addressing the problem. They have called on the industry to abide by a third-party measurement system, similar to how traditional media use Nielsen or other sampling data to provide a measurement of audience size.
"It needs to be addressed in the same way TV, radio, newspapers and magazines deal with it for the privilege of reaching certain people who buy certain things," said Chuck Richard, vice president of Outsell. Internet companies "cannot escape a third-party audit bureau to provide an independent measure of who they are reaching . . . It's inevitable."