One of the most popular forms of Internet advertising is pay-per-click (PPC). Merchants place ads with search engines like Google or MSN and the ad appears whenever someone enters a relevant search.
If the ad is clicked the merchant pays a fee anywhere from 5 cents to $100. Its a fabulous idea ad campaigns targeted at your most likely customers.
Its such a fabulous idea that Google, the king of PPC, grossed $1.24 billion in the first 3 months of this year most of it from advertising revenue.
Watch out, though. Theres trouble in PPC land. The flip side to PPC is a phenomenon called click fraud or click spam.
There are two types of click fraud. The first type occurs when someone maliciously clicks on your PPC ad to drive up your advertising costs. It could be a competitor or a disgruntled former employee.
The second type of fraud involves clicking on affiliate ads to generate income. Affiliate ads are placed on third party web sites and each time someone clicks on an affiliate ad the web site owner receives a commission.
Industry observers believe that affiliate click fraud is the biggest problem of the two. Either way, the result is the same advertising budget depletion with little gain for the merchant.
Either type of click fraud can be accomplished with the use of automated robots or by hiring an army of workers. The India Times reported in 2004 that a growing number of housewives, college graduates, and even working professionals across metropolitan cities are rushing to click paid Internet ads to make $100 to $200 per month.
How serious is the problem Its hard to judge exactly, but click fraud is commonly estimated at 20% to 35% of all PPC ad campaigns.
A recently launched lawsuit alleges that Google is aware of the magnitude of click fraud and does not do enough to alert advertisers of the problem.
The class action suit launched by says that Google has an inherent conflict of interest in preventing click fraud since it derives the same amount of income from each fraudulent click as it does from each legitimate click.
The $10 million lawsuit quotes Google Chief Financial Officer George Reyes as saying that click fraud is the biggest threat to the Internet economy.
Click Defense is a Colorado company specializing in click fraud detection. They claim that they themselves became a victim of click fraud when they advertised with Googles Adwords program this year.
They are seeking damages for breach of contract, negligence, unjust enrichment, and unfair business practices.
A Google spokesman said that the case is unmerited and that Google will defend itself vigorously.
Copyright 2005 by Ross MacIver
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Over the years I have had many accounts with Adwords, spending a small fortune with the Adwords service. So naturally I have picked up many cost saving tricks. I am aware that most people feel Adwords costs too much and delivers little results, this is completely untrue. Adwords is a service that is here to help us, so I have written this article to help web developers make the most out of the service.
1) Set your currency,
First and foremost, select the currency of which you locally trade in. You may think its wise to start your Adwords account in USD, but if you do not live in the USA you may get a shock when you find how much you have been charged.
2) Use negative keywords,
You are using the Adwords service to generate website traffic, so obviously you want the right traffic to generate revenue. Start by using negative keywords for people whom you do not want to click on your advert, the best place to start is the keyword free. As I doubt you want to waste money on traffic that will not generate revenue.
3) Make a strict daily budget
Make sure you have set out a daily budget, Adwords generally advise a way out of proportion budget. After all most new Adwords customers have no idea how effective the advertising will be. Do not start off with a bang, your pocket will feel it.
Just as important as the budget, be careful with the CPC rate. I advise you to start with a low number, each click soon adds up very quickly. I actually found that by lowering my CPC rate by 50% I doubled my visitor count
4) Check those clicks!
One of the most talked about problem with Adwords is, click fraud. There are two main types of click fraud: the first is when any one starts clicking away at your advertisements trying to waste your money. It is very hard to stop this kind of fraud, if you are a victim stop your ads and file a report to Google ASAP.
The second main issue is now that google allows Web Developers to earn money off their websites by placing ads (Adsense) .some Web Developers try to cheat the system by clicking on their ads as much as possible. The best way to stop this kind of fraud is check your page log, Adwords allow you to block out websites that you do not want your advert to be placed on.
Adwords does not have many protections against Click fraud, although they do disable Adsense accounts who cheat. Google are very hesitant to refund the victims, if at all. Reports tell many organisations are actually suing Google to get their money back, so be careful.
In this article I have illustrated some of the most beneficial ways to save money when advertising with Adwords. My main advice to you is, do not go crazy with your spending. You may not see the results you are after, it does take a while to get to know Adwords. I have had many successful ad campaigns using the Adwords network. However I do advise to look around, with the ever growing popularity of MSN search you may actually find it much more affordable.
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