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July 18th, 2006, 10:08 GMT · By

Click Fraud on the Increase

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A recent study released by the Click Forensics LLC has confirmed the ascendant trajectory of click fraud. The analytics firm claims that the total industry click fraud grew to 14.1% on average for the second
quarter of 2006, while in the first quarter it averaged at 13.7%. The metrics for the Q2 result from the monitoring of 1.300 advertisement agencies that are part of the Click Fraud Network. The Click Fraud Index monitored and reported the online advertising campaigns run through the Internet search providers. In this context it has concluded that click fraud has a layered structure, with search providers such as Yahoo, Google and MSN offering the most reliable Pay per Click services, while companies ranking lower scores and in inferior tiers attracting fraudulent clicks in proportions from 20.0 percent and up to 29.8 percent.

"The industry average click fraud rate for high-priced search terms was 20.2 percent. High-priced terms are defined as terms that cost over $2.00. These high-priced terms often make up the majority of an advertiser's total spend. The average pay per click term cost for the top key terms across the five biggest search advertising industries -- Retail, Financial Services, Health & Fitness, Technology, and Entertainment -- for Q2 was $4.51. This compares to $4.75 from Q1. The greatest percentage of click fraud, over 88 percent, originated from within the U.S. and Canada. Outside North America, the greatest amount of click fraud originated from within India. Unwanted click activity originating from India increased 26 percent during Q2. ", stated Click Forensics LLC in a press release.

"One of the most interesting findings from our Q2 data was the difference between the overall average industry click fraud rate and the click fraud rate for the most expensive search terms," said Tom Cuthbert, president and CEO of Click Forensics, LLC. "For the first time, we have industry data that clearly shows what many have expected -- organizations purchasing higher-priced search terms are significantly more vulnerable to click fraud."

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