Let’s say you launch a pay-per-click (PPC) marketing campaign where you pay only when visitors click on your ecommerce store’s digital ad. Despite high click volumes costing you money, you notice little engagement on your site. The issue could indicate slow loading times or design problems, but it might also suggest that your ad campaign is suffering from click fraud.
With the global cost of fraud in the digital advertising industry estimated to reach $172 billion by 2028 and nearly one in five US marketers identifying ad fraud and invalid traffic as a significant challenge, you need to understand how to protect your PPC campaigns.
Here’s where click fraud comes from, how to recognize it, and a few click fraud protection strategies you can implement.
What is click fraud?
Click fraud occurs when people or bots repeatedly click on a paid digital ad with malicious intent to generate revenue from advertising networks and deplete competitors’ ad budgets. Click fraud targets PPC marketing campaigns, causing merchants and advertisers to pay for invalid clicks on marketing channels like websites, search engine results pages (SERPs), and social media sites.
With average cost-per-click (CPC) rates between approximately 20¢ and $5 for ecommerce, fraudulent clicks can quickly add up and deplete your company’s advertising budget. Click fraud affects your placement on search engines as well, with invalid traffic consuming your paid ad campaign’s daily budget, reducing your exposure to real users.
Beyond wasting time and money with no return on investment (ROI), click fraud skews user data about your ad campaigns and can damage your reputation with customers, advertisers, and publishers.
Sources of click fraud
Here are some of the most common sources of fraud in pay-per-click ads:
Click farms
Click farms employ workers to click on specific ads and links. Businesses, content creators, advertisers, politicians, and fraudsters hire click farms to commit click fraud against competitors by either artificially boosting online metrics, which can get their competitor’s account flagged for spammy behavior, or repeatedly clicking on PPC ads to drain their competitor's advertising budget.
Botnets
A botnet is a network of compromised computers—infected with malicious code, or malware—that are controlled remotely by an attacker. Click fraud bots on these compromised devices act like real users, scanning websites and clicking on links, ads, and buttons.
Some bot traffic is harmless, like search engine web crawlers that index information from web pages, but bots designed for click fraud can create high volumes of false engagement that quickly drains the budget of your PPC ads.
Ad fraud
One of the most pervasive types of click fraud, ad fraud is the use of fraudulent clicks to generate revenue from an advertising network. This involves fraudsters hosting paid ads on their own websites and faking organic clicks. An advertiser pays for high-volume clicks generated on the website without knowing that the website operator is a scammer.
Competitors
Competitor click fraud occurs when business rivals engage in fraudulent activity to deplete their competitors’ PPC advertising budgets and lower the search engine ranking of their websites. Competitors may do this by having click farms, botnets, or their own employees click ads.
Domain spoofing
Domain spoofing is a phishing tactic where scammers create fake websites that imitate legitimate ones. Scammers forge the domain names of premium websites to sell fake ad space, misleading advertisers about where their ads are shown.
Accidental clicks
While most click fraud comes from malicious third parties, accidental clicks by viewers on ads displayed on search engines, websites, and social media platforms also occur. This type of traffic typically generates few clicks but can still negatively impact your ad budgets and indicate issues with your online advertising targeting.
Recognizing click fraud
Here are a few factors to keep an eye on when trying to identify click fraud:
High bounce rates
Bounce rate describes the percentage of website visitors who leave your site after viewing only one page. A high bounce rate can indicate technical problems and content issues, but it can also be a red flag that you’re experiencing click fraud.
Since bots navigate quickly between websites and links, they can increase bounce rates. High bounce rates can lower your search engine rankings, decrease organic traffic, and harm your company’s bottom line.
Low conversion rates
Conversion rate represents the percentage of visitors who perform a desired action on your website, like purchasing a product or signing up for a newsletter. When analyzing user behavior on your website, high click-through and low conversion rates can indicate fraudulent clicks.
Unusual IP addresses
IP addresses are unique numbers assigned to devices connected to the internet. High volumes of traffic generated from the same IP address or IP addresses in unusual locations where you aren’t targeting your paid ads can be a sign of click fraud. By monitoring the IP addresses that visit your ecommerce site, you can detect abnormal traffic that may indicate click fraud.
Ways to prevent click fraud
- Target your paid ads
- Monitor and exclude suspicious IP addresses
- Manage your ad budget
- Use click fraud prevention software
Here are some click fraud protection strategies to consider:
Target your paid ads
One of the best ways to prevent click fraud is to target your paid ads to specific locations, users, and timeframes. Using pay-per-click platforms like Google Ads and Meta Ads, you can define where and when your paid ads appear to your target audience. Managing your PPC campaigns helps reduce bot clicks from malware that broadly scans for digital advertising links.
Monitor and exclude suspicious IP addresses
Another way to reduce click fraud is to monitor IP addresses and identify differences between when a valid web user clicks on one of your PPC ads versus botnets or click farms. If you notice several clicks from the same IP address or unusual locations, you can exclude these IP addresses on PPC ad platforms like Google Ads.
Manage your ad budget
Set clear limits for your budgets on PPC ad platforms and monitor your spending daily. If your daily limit is reached too fast, investigate to ensure clicks are coming from legitimate users. If you notice fraudulent clicks, you can request a refund from PPC ad platforms by offering specific evidence of invalid traffic on your site.
Use click fraud prevention software
Another effective method for reducing invalid traffic on your PPC campaigns is to use a click fraud detection software program. This type of computer program monitors website traffic and analyzes user behavior to identify fraudulent activity. Use fraud prevention software to set click limits and automatically block invalid traffic generated by bots.
Click fraud FAQ
How do you identify click fraud?
Some of the indicators of click fraud on your pay-per-click ad campaigns include high bounce rates, low conversion rates, and traffic coming from unusual IP addresses.
How common is click fraud?
The frequency of click fraud differs depending on your specific industry, location, and company. However, one survey estimated that over a fifth of digital advertising spending was wasted on ad fraud in 2023.
What is the cause of click fraud?
Click fraud occurs from a variety of sources, including malware botnets, click farms, and competitors and could be motivated by a number of factors, such as competition or even accidental clicks.
