PPC, per-per-click Advertising, or Click-thrus have always been a bone of contention but an interesting story (Scandal) is emerging from a digital company called 'Limited Run' in New York. It's about click fraud. And it's getting a lot of attention. Mashable are leading with the story today.
Limited Run, a platform for selling music and other stuff, noticed that only 20% of the Facebook clicks it was paying for, actually brought people to its site. But Facebook were charging for 100%. Whoa.
Being fairly smart online people, they ran several analytical tools and yep, could only confirm 15-20% of the clicks. So they looked at it more deeply themselves and found that the questionable 80% came from web browsers with their 'java script turned off/disabled'. A page logger, tracked every time a page was loaded so they knew what they were doing.
Because the more the ads are clicked, the more the advertiser is charged, the more revenue for the publisher. It's the essence of this type of online advertising and an accusation that no media provider would ever want to entertain. It cuts to the core of trust.
Not that they're accusing Facebook of automating clicks to drive up revenues - not at all, who would consider such a thing?? - but when they asked Facebook they were met with a wall of silence, they say.
With Facebook shares closing yesterday down 45% on their IPO price, it also revealed that nearly 9% of its accounts are "fake". Which in real terms is circa 83 million accounts! Bots, Fake Accounts.....wow.
The BBC, whom I think we all consider to be well regarded, also in a bit of an experiment, set up a Facebook page called 'VirtualBagel' to see what would happen. It was a nothing page, selling nothing, just made up to see what would happen.
They quickly got 1600 likes in 24 hours and then in a week, 3000. The interesting thing is that they seem to have come from "suspicious" profiles, largely 13-17 year old Egyptians. Because the more likes you get, the more encouraged you are, the more you invest, the more it works...provided the likes are real.
Who would do such a thing? Certainly not Facebook I'm sure. Automating clicks to generate revenue (which they badly need by the way having just shown a loss), generating likes to encourage brands, fake accounts...not a good week.
In 2005, Yahoo settled a 4.5 million usd suit where it was claimed that they "didn't do enough" to prevent click fraud. Google settled for 90 million usd in 2006 on a similar basis.