Click Fraud Jumps to Nearly 16 percent in Second Quarter

Pay-per-click (PPC) industry fraud figures for the second quarter of 2007 increased a full percentage point from the previous quarter, reaching an average of 15.8 percent, according to Click Forensics, Inc.’s Click Fraud Index, MarketingCharts reports. Key findings from data reported for 2Q07:

• The overall industry average click fraud rate was 15.8 percent in 2Q07 - an increase from the 14.1 percent for the same quarter in 2006 and 14.8 percent in the first quarter of 2007.

• The average click fraud rate of PPC advertisements appearing on search engine content networks, including Google AdSense and the Yahoo Publisher Network, was 25.6 percent. That’s up from 21.9 percent in 1Q07 and 19.2 percent in 4Q06.

• Traffic from botnets doubled from Q1 to Q2 and contributed significantly to the increase in click-fraud rates.
• In Q2, the greatest percentage of click fraud originating from outside North America came from France (5.1 percent), China (3.2 percent) and Australia (3 percent).

The FBI recently reported that botnets - which are used to facilitate spam, identity theft, denial of service attacks, phishing, spyware distribution and click fraud - have infiltrated more than 1 million US computers.

“Click fraud has become the new spam and it’s clearly a problem that is getting worse, not better,” said Tom Cuthbert, president and CEO of Click Forensics.

“A significant percentage of today’s click fraud traffic can be attributed to two growing areas of concern for search advertisers - traffic that comes from botnets and from parked domains or made-for-ads sites. Advertisers running campaigns on content networks are especially vulnerable as they are increasingly targets of this growing pool of savvy fraudsters.”