Click Fraud Statistics

Click Fraud Statistics

Click and ad fraud are something of an enigma but what is clear is that their influence is all-encompassing and, it would seem, very much here for the long-term. Whilst there has been significant improvements in recent years – particularly from Google Ads – the threat and damage which click and ad fraud can inflict upon the PPC market is still very much increasing. Quite simply, this means a significant amount of advertisers’ money is lost as a result. In 2016 it was estimated that around $7.2 Billion dollars (£5.4 Billion pounds) was lost to click fraud. This increased to $16.7 Billion dollars (£12.7 Billion pounds) in 2017 and it is estimated that $27.2 Billion dollars (£20.7 Billion pounds) will be lost by the end of 2018. Statistically this is equivalent to a 227% increase over the course of two years! It’s not just the monetary value which is shocking, it is also the fact that the click fraud statistics are significant over this relatively short period too.

Look at it this way, every few years there are significant changes within digital marketing, whether this be through a new platform or device. Up to that point the threat of click and ad fraud is contained, but when new developments emerge the threat once again arises and new ways to undermine PPC and online advertising emerge. Due to the nature of click fraud statistics, platform providers such as Google Ads and BING Ads have struggled to stay fully abreast of the problem, partly due to the need to stay as accessible as possible for users. Consequently, third party providers such as Click Guardian have developed tools in which online advertisers can ensure that click fraud are kept in check. If you’ve identified a pesky IP address – then you need not worry, there are ways to eliminate it but understanding the bigger picture is even more important.

Click Fraud Statistics 2016 to 2018

2016 - $7.2 Billion
2017 - $16.7 Billion
2018 - Estimated $27.2+ Billion

With this in mind, it is perhaps a good idea to look at 2017 click fraud statistics as a snapshot of the click and ad fraud phenomenon. Indeed, there were some surprising facts which emerged over the 12 month period.

An interesting feature of 2017 was the apparent increase in desktop-based Click Fraud. This would appear to be bucking the trend – after all, the prevailing trend has been the rise of mobile-based traffic. Anywhere from 1 in 5 (20%) to one quarter (25%) of clicks were fraudulent in nature. As to why there was an increase last year, it may be due to the focus mobile as dominated in recent years. Many advertisers would assume that mobile-based traffic would be where both their audience and, by default, fraudulent clicks would be found. This focus meant that desktop traffic was not afforded the same level of attention when screening for fraudulent clicks. Despite the overriding click fraud statistics trend, desktop is still a sizeable player in digital marketing, it can never fully be discounted and ignoring the potential for click and ad fraud from desktop traffic will surely blow a sizeable hole in your budgets.

Rise of the Click Fraud Bots

Another very noticeable feature of both last year and in recent years in general is the development and use of bots to produce fraudulent clicks. With the rise of AI and machine learning, it comes as no surprise that bots would be a persistent and growing problem last year and beyond. If this wasn’t already problematic enough, it’s also challenging to pinpoint the source of the bots. It was estimated that around 20% of websites and ads were visited or clicked on by bots in 2017. This is an alarming figure and it can be argued that this may be only really an approximation. What is certain is that this figure will most likely increase in the next five years. Developments in AI are increasing each year and despite the ability of developers to create sufficient safeguards against bots, the ability for new programs to develop ways around these safeguards increases too.

With this in mind, it leads nicely into another development which shares similarities with the use of bots to commit click fraud. Within the last five years or so, the increased use of VPN. VPNs, or Virtual Private Networks, are a way for users to connect via an encrypted connection. To those who are less aware, this is a more effective way for malicious users to cause disruption to people’s PPC ads by excessive clicking, in essence this type of behaviour is more difficult to detect than a traditional, standard ISP connection.  In much the same way bots are increasingly difficult to pinpoint, VPNs make it difficult for IP adresses to be detected and identified as malicious. It must be said that in 2016 the estimated use of VPNs was small in the UK, roughly 5%, but worldwide use was estimated to be at around 25%. However, with the advent of The UK Investigatory Powers Act – or as it is more commonly known, the ‘Snoopers Charter’- the frequency and use of VPNs has increased significantly. In effect, it has propelled VPNs into the public arena and consequently caused their increased use amongst users who wish to commit click fraud.

Friendly Fire

Whilst antagonistic behaviour has markedly increased over the last few years, the occurrence of what can be termed ‘friendly fire’ can be identified as another factor and it is entirely more innocent as the name suggests. With the development of smart phones and tablets in the last decade and the increased use of smart phones for online transactions, the incidents of click fraud occurring through users mistakenly clicking on ads has increased. Perhaps the most noticeable aspect of this is that it is difficult to identify when this has happened – statistics are quite simply hard to estimate. It is therefore important to consider this when analysing data and identifying potentially fraudulent behaviour. That been said, you would expect the vast majority of users to avoid this occurrence. The nature of search engines means that is now easier to find a search topic but mistakes will invariably happen.

The Future of Click Fraud

In general, the click fraud statistics point to an increasing trend. If 2017 is anything to go by, it would appear that the war against fraudulent clicks is very much here for the long-term. As stated earlier, whilst improvements have been made in this field, the nature of search advertising and search engines means the click fraud problem is never really solved – one door may close but another one will invariably open.

You may be wondering then what the future holds. Well, unsurprisingly, click and ad fraud will remain a threat to PPC marketing. As to what the future will look like depends on a number of factors. Platform providers such as Google and BING will certainly need to improve if the threat is to be drastically reduced. Based on previous performance, this cannot be relied upon – it simply hasn’t materialised. It is clear that in the absence of this, third party providers can certainly plug the gap. As pointed out, the adoption of government legislation hasn’t helped the situation either. It could be that legislation is enacted in the future but the government response to online fraud has been mixed in recent years – there is no reason to believe that this will change in the near future.

Whatever way you look at the problem, click fraud will remain a feature of PPC marketing and search advertising for years to come. It will remain the prerogative of the advertiser to ensure that click fraud behaviour is held firmly at bay.