PPC Advertising... Does it really pay off?
Click Fraud Facts
KNOW THE FACTS ABOUT CLICK FRAUD.
It is important to understand that click fraud occurs over time and is very difficult to prevent. CPM advertising is a proven method for higher ROI, as there is no incentive for fraudlent clicks (wasted advertising money). Of course there is always the factor of fraudulent impressions, but it is much less likely and tracking & prevention is much easier with CPM campaigns.
FACT 1: IN 2004, AT LEAST $500 MILLION IN PAY-PER-CLICK ONLINE ADVERTISING EXPENDITURE HAS BEEN WASTED THROUGH CLICK FRAUD.
If you’re spending money on paid search online advertising, or PPC programs, chances are you’re not getting the return on investment you should be. In fact, over 70% of your advertising expenditures could be from bogus clicks, depending on the advertising platform you are using.
FACT 2: BY 2008, THE ESTIMATED COST OF CLICK FRAUD TO ONLINE ADVERTISERS WILL BE IN EXCESS OF $1.6 BILLION.
More and more online advertisers are relying on the Internet as a reliable, cost-effective medium. In fact, there is no end in sight to the expected growth of the Internet as a viable advertising medium.
FACT 3: AS MUCH AS 70% OF ANNUAL ONLINE ADVERTISING SPENDING IS WASTED BECAUSE OF CLICK FRAUD.
Even more remarkable, the majority of online advertisers do not even realize that their advertising budgets are being squandered on false clicks.
FACT 4: PAID SEARCH ONLINE AD SPENDING IS EXPECTED TO DOUBLE IN THE NEXT THREE YEARS.
It is the fastest growing advertising medium in the world today. And its growth will increase the financial incentives for affiliates and others to perpetrate sophisticated schemes of click fraud, raising the stakes and expenses for advertisers. So basically the problem is seen as an escalating issue, rather than one that is being resolved according to advertising agencies. As new fraud prevention methods are implemented by these agencies, so will the methods of click fraud change.
FACT 5: CORRUPT AFFILIATES OF AD NETWORKS SUCH AS GOOGLE AND YAHOO ACCOUNT FOR 85% OF ALL CLICK FRAUD.
Affiliate driven fraud has been identified as the leading source of bogus traffic for advertisers, and has been primarily found in PPC campaigns, as the payment per action has a much greater incentive. That is why CPM advertising is rapidly becoming the new advertising trend.