Google, Yahoo Speaking More Freely on Click Fraud

I attended the Auditing Paid Listings & Click Fraud Issues session at Search Engine Strategies New York this year, expecting more of the same, but was really quite surprised by how different the panel was from years past. Where previously Google and Yahoo would be lambasted by the audience, tight with information, and confrontational, the session this time was informational, only slightly confrontational, and for the most part met with a receptive audience.

The differences, as attested to by both Shuman Ghosemajumder, business product manager for trust and safety at Google, and Reggie Davis, VP of marketplace quality for Yahoo Search Marketing, was that each search engine’s legal department has recently loosened the reins on what can and cannot be said, as a result of the settlements that have been reached in the various class action lawsuits over click fraud.

In Davis’ case, he is the one that locked down Yahoo’s communication in the first place, having been the lead attorney on its click fraud cases for the past seven years. Davis was named to his new “click fraud czar” position in March and immediately began sharing information, publicly disclosing for the first time the portion of invalid clicks it filters out before advertisers are billed for them.

“There’s been a significant disconnect between what we do internally, and what we’re able to share externally,” Davis said.

Google has also been much more forthcoming with real data on click fraud, and the broader issue of fraudulent clicks. In March, Ghosemajumder revealed specific data on invalid clicks in Google’s AdWords system. He also announced several planned click-fraud-related initiatives, including IP Filtering capabilities for advertisers, enhanced invalid click reports, educational initiatives, and an improved reporting format.

The two shared their respective data in the session last week, marking the first time this session has been predominantly guided by Powerpoint presentations. Ghosemajumder and Davis were both happy to be able to say more than “we take click fraud very seriously, and are working very hard at it,” a standard response in years past.

They also highlighted their work to educate advertisers on click fraud, and the broader category of invalid clicks. Both companies are now developing online resource centers to educate and communicate on the issues.

“We want to make people comfortable, so they continue spending money with Yahoo,” Davis said. “We feel we’re committing the right amount of resources, and doing the best we can. Ultimately, we need to make sure advertisers get an ROI high enough to continue advertising with Yahoo.”

The focus of the session was different too, for both the search engines and the others on the panel: Tom Cuthbert, president and CEO of click fraud auditing firm Click Forensics, and John Marshall, CEO of Web analytics firm ClickTracks. Cuthbert said the engines were getting better at detecting and preventing click fraud, and progress was being made by industry groups like the Click Quality Council, and the Click Forensics-backed Click Fraud Network. Marshall suggested the problem was less prevalent than many people thought, and many suspected instances were instead the result of poorly performing ads.

Marshall began the session with a presentation illustrating the difficulties of detecting click fraud, or even invalid clicks, using Web analytics.

“As it turns out, distinguishing a badly designed ad from click fraud is actually quite difficult. They look very similar,” Marshall said.

Because of this difficulty, Marshall also cautions that the idea of an automated model of detecting click fraud is flawed, since it will always require a human to look inside the data and make a judgment to be sure. The best technique, he said, is to look for outliers in the data and compare them. Some examples of metrics to look at include short average time on site, or a large number of clicks from another country. He also cautioned that trying to detect click fraud based on ROI is not always useful, as many campaigns just have low conversions due to non-fraud-related issues.

“I’m cautious about using ROI as an indicator of whether you have fraud-related problems or not. The quality of ROI data is generally pretty poor,” he said.

The upside of that problem is that by examining your users’ behavior with Web analytics attempting to find click fraud may instead reveal ads that need attention. The end result in either case will be beneficial, because both kinds of issues need to be fixed, he said. “You’ll save more on fixing poorly designed campaigns than on what you find as click fraud,” he said.

Marshall also said that invalid click detection should be like an airport metal detector, tuned to over-report instead of under-report. Both Google’s Ghosemajumder and Yahoo’s Davis said they designed their systems using this principle.

You can also visit Search Engine Roundtable for a live-blogged transcript of the session.

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