What is click fraud?
Click fraud refers to clicking on online advertisements with no genuine interest in the products or services offered. This type of fraudulent activity can occur intentionally or automatically, and its primary aim is to increase the cost for the advertiser. Click fraud is most common in pay-per-click (PPC) advertising, where advertisers pay for each click on their ads. Unlike genuine clicks that lead to potential customers, fraudulent clicks waste advertising budgets and distort marketing data.
Click fraud is a significant issue in online advertising, affecting both small businesses and large corporations. Various actors can carry it out, including competitors, publishers, and automated bots. This practice drains advertising budgets and makes it more difficult for businesses to measure the actual performance of their digital campaigns.
How does click fraud work?
Click fraud can occur in various ways. These methods can be manual, automated, or a combination of both. Below are some of the ways click fraud works.
Manual clicks
Manual click fraud occurs when an individual clicks on ads without intention of purchasing or engaging with the advertised product or service. Someone could do this with malicious intent, such as a competitor trying to deplete an advertiser’s budget. It can also happen when a publisher clicks on ads displayed on their site to increase their earnings.
While manual clicks are relatively easy to spot compared to automated fraud, they can still be challenging to identify in large-scale campaigns. If a click fraudster is highly motivated, they may use multiple devices and IP addresses to make the clicks appear legitimate.
Automated clicks
Automated click fraud is a more sophisticated method where computer programs or bots are used to click on ads. These bots are designed to mimic human user behaviour, making it challenging to distinguish fraudulent clicks from genuine ones. Automated fraud can be done at a much larger scale, with bots generating hundreds or even thousands of fraudulent clicks within a short period.
Several techniques, such as IP rotation or proxy servers, can be used to commit automated click fraud. These methods help hide the fraudster’s real identity and make it harder for advertisers to detect the fraudulent activity.
IP address manipulation
Another method of click fraud involves manipulating the IP address to disguise the fraudster’s identity. This is commonly done using virtual private networks (VPNs) or proxy servers. By masking their real IP address, fraudsters can make it appear like they are clicking from different locations, making it more difficult to trace the fraudulent activity.
In some cases, fraudsters may even use large botnets – networks of infected computers – to generate click fraud. These botnets can be spread across multiple countries and IP addresses, making the fraud more difficult to detect.
Distributed clicks
Distributed click fraud occurs when fake clicks spread over multiple devices, IP addresses, or geographical locations. This method is often used to make the scam appear less suspicious, as it mimics the behaviour of legitimate users from various regions. Fraudsters may use a network of devices or hire people from different countries to click on the ads, thus preventing any single device from making too many clicks simultaneously.
Distributed click fraud can be challenging to detect because it doesn’t follow the same patterns that traditional fraud detection tools would flag. The clicks might appear from real customers in different locations, making distinguishing them from legitimate activity difficult.
Click farms
Click farms are a method of click fraud that employs many people to click on ads manually. These workers are often paid a small amount for each click they generate, making it a cost-effective way to inflate ad statistics. Click farms can be large operations, often in countries where labour is inexpensive.
Sometimes, click farms may use a mix of real users and automated tools to generate fake clicks. This practice can significantly impact ad campaigns, particularly in industries that rely on PPC advertising to drive traffic and sales.
Who engages in click fraud?
Several individuals or groups can carry out click fraud, each with their motivations and methods. Understanding who engages in click fraud is essential for businesses to develop strategies to protect their advertising budgets.
Competitors
Competitors are one of the most common perpetrators of click fraud. By repeatedly clicking on an advertiser’s ads, they can deplete the advertiser’s budget, reducing the effectiveness of their campaigns. Businesses often employ this tactic to drive their rivals out of the market or prevent them from gaining visibility.
Competitor-driven click fraud is complex to prevent, as it can involve seemingly legitimate users clicking on ads. However, by monitoring traffic patterns and click data, advertisers can identify suspicious activity and take action.
Publishers
Publishers can also engage in click fraud, especially when they display ads on their websites. This can be an easy way for publishers to increase their earnings from PPC advertising. By clicking on the ads that appear on their sites, they can artificially inflate the number of clicks and, in turn, earn more revenue.
This type of fraud is often more difficult to spot, as publishers may use different IP addresses or devices to disguise their actions. In some cases, fraudulent publishers may even use automated tools to click on their ads.
Hackers and cybercriminals
Cybercriminals are another group that engages in click fraud. They often use botnets – compromised device networks – to commit large-scale click fraud. These botnets can be used to click on ads repeatedly and generate fake traffic, all while making it appear that the clicks are coming from legitimate users.
Cybercriminals may also use click fraud to infect devices with malware. Once the devices are compromised, they can generate fraudulent clicks and carry out other malicious activities.
Customers
While less common, customers can also inadvertently engage in click fraud. This can happen when a user repeatedly clicks on an ad to navigate through a website, especially if the ad is poorly placed or misleading. While these clicks may not be intended to harm the advertiser, they can still result in wasted advertising spend.
Ad networks and advertisers must distinguish between fraudulent clicks and normal user behaviour to avoid penalising innocent users.
Common types of click fraud
Click fraud can take many forms, and understanding the different types is essential for identifying and preventing it. Below are some of the most common types of click fraud that affect businesses today.
Ad fraud
Ad fraud involves creating fake websites to host ads and generate fraudulent clicks. These websites often appear legitimate, with content designed to attract visitors. Once the site has enough traffic, the fraudster can display ads and click on them to generate revenue.
Ad fraud is often carried out by fraudsters who operate multiple fake websites. These websites may be hosted on the same server or distributed across a network of devices, making detecting fraud difficult.
Bot click fraud
Bot click fraud is a type of click fraud that uses automated scripts or bots to generate fake clicks. Bots can be programmed to click on ads, repeatedly mimicking user behaviour. This type of fraud can be carried out at a much larger scale than manual click fraud, as bots can operate continuously without any human intervention.
Bot click fraud is one of the most common forms of click fraud, and it can be challenging to detect. Fraudsters may use botnets – networks of infected devices – to carry out large-scale fraud without notice.
Pixel stuffing
Pixel stuffing involves loading an ad into an invisible pixel (a 1×1 pixel), making it appear as though it is displayed but not visible to the user. This technique generates impressions without actual user engagement. While pixel stuffing may not involve clicks, it can still waste advertising budgets by inflating impressions.
Advertisers may not be aware that their ads are being served in this way, as the ad is technically registered as being displayed, even though it is not visible to users.
Ad stacking
Ad stacking is another click fraud method involving placing multiple ads on top of each other. Only the top ad is visible to the user, but all the ads in the stack register impressions and clicks. This technique can result in inflated click counts, which benefits the fraudster but not the advertiser.
Ad stacking can be difficult to detect, as the ads are technically displayed and clicked, but they do not provide any real value to the advertiser.
Competitor click abuse
Competitor click abuse occurs when a competitor repeatedly clicks on an advertiser’s ads to drain their advertising budget. This type of click fraud is usually done to reduce the effectiveness of the advertiser’s campaigns or to push them out of the market.
Competitor click abuse can be challenging to prevent, as it often involves legitimate-looking traffic. However, advertisers can monitor their campaigns closely to identify unusual click patterns.
Video click fraud
Video click fraud involves using bots or other fraudulent methods to inflate video ad views. Fraudsters may generate fake video views, making it appear as though the video has been watched by many users when, in fact, the views are coming from automated bots. Video click fraud can result in wasted ad spend, as advertisers may pay for views that are not genuine.
Incentivised clicks
Incentivised clicks involve offering rewards or payments to users in exchange for clicking on ads. While this may not always be considered fraud, it can still waste advertising budgets. Users may click on ads without genuine interest in the product or service, resulting in wasted clicks and low conversion rates.
The impact of click fraud
Click fraud significantly impacts businesses, advertisers, and the entire online advertising ecosystem. Below are some of its most notable effects.
Financial losses
The most direct impact of click fraud is the financial loss that advertisers experience. Every time a fraudulent click is made, the advertiser pays for that click without receiving any potential business in return. Over time, these fraudulent clicks can add up, leading to significant losses.
In some cases, businesses may lose thousands or even millions of pounds due to click fraud. This can severely impact a company’s advertising budget, making it harder to compete in the market.
Distorted marketing analytics
Click fraud also distorts marketing analytics, making it difficult for businesses to measure their campaigns’ effectiveness accurately. When fraudulent clicks are mixed in with genuine clicks, it becomes hard to distinguish between high-quality leads and wasteful clicks.
This distorted data can lead to misguided decisions, as businesses may focus on metrics that don’t reflect user engagement. For example, a high click-through rate (CTR) may look good on paper, but the campaign is ultimately unsuccessful if the clicks aren’t converting.
Lower conversion rates
Click fraud can also lead to lower conversion rates. When a business receives fake clicks, the chances of converting those clicks into actual customers are minimal. Even if a click results in a visit to the website, the fraudster is unlikely to engage with the product or make a purchase.
This reduces the overall effectiveness of a PPC campaign, as businesses are paying for traffic that does not lead to sales or meaningful engagement.
Higher advertising costs
Click fraud also leads to higher advertising costs. As fraudulent clicks accumulate, businesses must pay for non-genuine traffic, increasing the overall cost per click (CPC). This drives up the cost of running online advertising campaigns, reducing advertisers’ return on investment (ROI).
Higher costs can also make it more difficult for smaller businesses to compete with more prominent players, as they have fewer resources for advertising.
Search engine manipulation
Fraudsters may also use click fraud to manipulate search engine rankings. By artificially inflating the number of clicks on a particular ad or website, fraudsters can improve a website’s ranking in search results, making it appear more popular or relevant than it actually is.
This type of fraud can undermine the integrity of search engines and online advertising platforms, as it skews the data used to rank websites and display ads.
How to detect click fraud?
Analysing traffic patterns
Monitoring ad traffic is crucial for detecting click fraud. A sudden spike in clicks without a corresponding increase in conversions is a strong indicator. High click-through rates (CTR) with low engagement suggest that bots or fraudsters artificially inflate ad interactions.
Tracking IP addresses and locations
Repeated clicks from the same IP address or from unusual locations can indicate fraudulent activity. Advertisers can analyse geographic data to check for unexpected traffic sources. Blocking suspicious IP addresses can help reduce fraudulent clicks.
Using bot detection tools
Advanced fraud detection software tracks user interactions, such as mouse movements and time spent on a webpage. Bots tend to have predictable behaviour, such as clicking links without meaningful engagement. Identifying these patterns helps distinguish between real users and automated fraud.
Checking session durations and bounce rates
Fraudulent clicks often result in high bounce rates and short session durations. If visitors leave the website immediately after clicking an ad, it may indicate click fraud. Comparing these metrics across different campaigns helps identify inconsistencies.
Reviewing click timestamps and frequency
Many clicks occurring quickly, especially from the same source, suggests automated fraud. Click timestamps can help detect unnatural patterns, such as rapid or repeated clicks from the same user or device.
Leveraging third-party fraud detection services
Using fraud detection services adds an extra layer of security. These services analyse global traffic patterns and use AI to identify fraudulent behaviour across multiple platforms. Their advanced detection methods can help prevent click fraud before it impacts an ad campaign.
How to stop click fraud?
Implementing fraud detection software
Fraud detection tools monitor real-time ad activity, identifying suspicious behaviour and blocking fake clicks. Many platforms, including Google Ads, offer built-in fraud prevention, but third-party tools provide more advanced protection.
Blocking suspicious IP addresses
Regularly monitoring traffic sources allows businesses to block IP addresses associated with fraudulent activity. Some fraudsters use VPNs or proxy servers to disguise their location, so combining IP blocking with other detection methods improves accuracy.
Setting click frequency caps
Limiting the number of times a user can click on an ad prevents repeated fraudulent interactions. Most ad platforms allow advertisers to set click limits, reducing the risk of bots or competitors driving up costs.
Adjusting ad placement
Ads placed on low-quality or unverified websites are more vulnerable to fraud. Choosing premium ad placements on trusted publishers reduces exposure to bots, click farms, and incentivised clicks.
Monitoring engagement metrics
Tracking conversion rates, time on site, and user behaviour helps businesses identify fraudulent clicks. If an ad receives many clicks but few meaningful interactions, it may be targeted by click fraud. Regular performance reviews help advertisers take action before fraud causes significant financial loss.
FAQs
Is ad click fraud illegal?
Ad click fraud is illegal in many countries. It involves deceptive practices that harm advertisers financially. Laws like the US Computer Fraud and Abuse Act prohibit such activities. Violators can face fines, lawsuits, and even criminal charges.
What is click spoofing?
Click spoofing is a technique in which fraudsters manipulate data to make it appear as though a legitimate user clicked on an ad. They can do this by altering IP addresses, device fingerprints, or browser details to bypass fraud detection systems and generate fake ad revenue.
What is the rate of click fraud on Facebook?
The click fraud rate on Facebook varies but is estimated to be between 10% and 20% of all ad clicks. Fraudulent activities include bot clicks, fake accounts, and engagement from click farms. Facebook uses AI-powered tools to detect and mitigate fraudulent behaviour.
What is the rate of click fraud?
Click fraud affects 10% and 30% of all online ad clicks, depending on the industry and platform. Some sectors, like finance and legal services, experience higher rates. Global losses from click fraud are estimated to exceed $50 billion annually, impacting digital advertisers.
What is click fraud in cyber security?
Click fraud in cyber security refers to manipulating online advertising by generating fake clicks using bots, scripts, or human-operated click farms. It is considered a form of cybercrime that causes financial losses, skews marketing data, and undermines ad network integrity.
