Though most people are unaware of it, click fraud is a genuine problem for any organization involved in digital marketing. Digital marketing is online marketing for the most part. It is subject to various forms of ad fraud, with click fraud being just one of them. And believe it or not, some industries are more susceptible to it than others.
Click fraud is perpetrated mainly against advertisers who rely heavily on the pay-per-click (PPC) model. PPC ads are especially vulnerable to click fraud due to the way they are sold and distributed. But that does not explain why some industries are more susceptible to it. For that answer, we need to delve into how PPC ads work.
Pay Only for Clicks
As the name implies, PPC ads are built on the idea of only paying when someone clicks an ad. The model is good for advertisers who do not have to spend marketing dollars reaching unlikely customers. But the model has some inherent characteristics that lend themselves very well to click fraud:
1. Ads Are Keyword Based
PPC ads are keyword based. That means they are displayed to web users based on their internet activity, including searches. The idea behind linking them with keywords is actually a good one because it allows advertisers a lot more detail in terms of targeting specific audiences. They are not wasting money advertising to people not likely to buy.
2. Advertisers Bid on Keywords
PPC platforms do not charge a flat rate for ads. Rather, advertisers are required to bid on the keywords they want to target. Their bid price is their fee per click. If I bid $0.50 on a particular keyword for my new ad, 100 clicks on that ad would generate a $50 bill.
3. Ads Are Distributed
In order to maximize exposure and revenue, ad platforms work with third-party publishers to distribute ads across a wide variety of networks. In plain English, Google does not publish every ad it sells. Rather, it distributes ads through its publisher’s network. Members of that network are served ads they can display on their websites, in their mobile apps, and so forth.
The Perfect Recipe for Fraud
The three characteristics described in this post do not necessarily lead to click fraud individually. But combined, they create the perfect recipe for fraud. Fraud Blocker, a company that develops click fraud prevention software, compares it to how a hurricane develops. The combination of water vapor, warm temperatures, and air currents can create enormously powerful storms in the right combination. The same is true for click fraud.
This also explains why some industries are more susceptible to it than others. Industries like real estate and healthcare are especially susceptible because they have some of the most highly competitive keywords anywhere on the net. Real estate brokers and online real estate websites pay a lot for their keywords. So do hospitals, healthcare clinics, and even private practices.
Remember that an advertiser’s bid equals the amount it pays for every click. It stands to reason that fraudsters would target the most expensive keywords in order to maximize their ill-gotten profits. They go where the money is. They target real estate, healthcare, travel, and other highly lucrative industries.
Google, Facebook, Amazon, and Apple do what they can to prevent click fraud. But they are up against a formidable opponent capable of stealing tens of billions of dollars annually. They need online advertisers to step up and do their part as well. When everybody involved in digital marketing contributes to the fight, fraudsters have a harder time committing their crimes.
