Click fraud101: the basics of prevention and detection

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Worldwide, advertisers last year spent $15 billion in pay-per-click advertisements. Pay-per-click helps companies of all sizes reach a national audience with a small initial investment.

However, click fraud also happens.

Whether it's a competitor using the latest software to drain your advertising budget or an affiliate employing foreign "clickers" to increase monthly compensation, research indicates at least 30 percent of all clicks are fraudulent.

While major search engines promise to monitor and refund fraudulent clicks, it doesn't take a genius to realize that Google, Yahoo and others have a significant financial interest in avoiding click-fraud refunds.

Experience shows it is more cost-effective for marketers to monitor PPC campaigns using basic planning and tracking methods that prevent marketers from being a potential target and help them identify fraudulent clicks when they happen. Here are seven tips to help your company minimize click fraud:

Stick with high-traffic search engines like Yahoo, Google, Ask and MSN. Unknown engines are hungry for revenue and filter click fraud less.

Increase your keyword bank to include the most specific and relevant terms that apply to your company, product or service. High-traffic, expensive keywords are targets for click fraud.

Consider investing in a tracking solution to identify suspicious traffic by comparing originating domains to fraudulent ones.

Don't bid simply to be No. 1. Marketers mistake the top page position for the best conversion or ROI. This misunderstanding usually results in nothing more than unqualified traffic.

Target regions where your services and products are available. If your market is the US, don't waste clicks on merchants in India.

Track click charges frequently. This practice will make you aware of abnormal increases or decreases in traffic.

Be sure to stop all advertising and contact the search engine if you believe you're a victim of click fraud. Whether your annual PPC budget is in the thousands or millions, you're not interested in losing financial resources to fraudulent clicks or impressions. With careful planning and tracking, it is possible to protect the integrity and the ROI of your pay-per-click campaigns.

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