The New York Times > Business > Media & Advertising > Advertising: Web Marketers Fearful of Fraud in Pay-Per-Click: "March 3, 2005
ADVERTISING

Web Marketers Fearful of Fraud in Pay-Per-Click

By NAT IVES

Businesses that pay billions to Google and Overture to steer potential customers to their Web sites are increasingly questioning how much fraud lurks in the blossoming pay-per-click model of advertising.
There is evidence that at least some scammers are clicking away at the ads, or having programs called hitbots or clickbots do it for them, with the knowledge that each click costs an advertiser money. Some of the troublemakers are disgruntled employees; some are companies trying to force competitors' ad spending up; some are even Web page operators who let search engines deliver ads to their sites and then collect a cut when people click on those ads.

Ad buyers worry that 'click fraud' could become rampant, if unchecked - a development that could undermine confidence in the fastest-growing segment of Internet advertising.

Executives at Speedy Registrations, a British company that sells personalized license plates, said they believed that its pay-per-click ads were fraudulently hit last year.

The company, which has been advertising its site, www.speedreg.co.uk, on Overture since August, saw daily traffic from its keyword ads abruptly triple, from 400, for five days last October, said Des Elton, managing director. 'We averaged 1,200 clicks a day, costing us ?950 on average every day,' or about $1,800, he said. 'We'd been up to ?450 to ?500 before, but that was the extreme case.'

The sudden boom in site traffic would have been welcome if it had produced increased sales, but conversions from clicks ..."