Google in Curious Alliance With Click-fraud Detection Firm

In a development that would have seemed impossible two years ago, Google is cooperating publicly with Click Forensics, a click-fraud detection company with which it has had a rocky relationship.
Click Forensics said Thursday that Google has agreed to accept the electronically generated click-quality reports generated by the Click Forensics FACTr service. That means the process of documenting click-fraud instances and submitting reports to Google will be significantly automated and simplified for advertisers that use the FACTr service.
Google and Click Forensics make for strange bedfellows. The companies have sparred over the issue of click fraud, and the rhetoric has often approached ugly territory.
Google has accused Click Forensics of being inept in its methodology and misleading in its results in order to make the problem seem bigger than it is. Meanwhile, Click Forensics has charged that Google has purposefully trivialized click fraud and mischaracterized it as a minor problem.
Starring in the skirmishes have been Click Forensics President and Founder Tom Cuthbert and Google's expert on click fraud, Shuman Ghosemajumder.
Click fraud happens when someone clicks on an ad with malicious intent. For example, a competitor may click on a rival's pay-per-click ads in order to drive up their ad spending. Or a publisher may click on pay-per-click ads on its site to trigger more commissions.
Google generates almost all of its revenue from the type of online advertising that is most vulnerable to click fraud -- pay-per-click ads that appear along with relevant search results or in Web pages of relevant content.
Google declined to comment for this article, but Click Forensics CEO Paul Pellman said his company welcomes Google's cooperation in the FACTr (Fully Automated Click Tracking Reconciliation) service.
"From our standpoint, this is the first opportunity in which we've been able to implement something specific with Google, which is great," Pellman said.
Joseph Cowan, senior search strategist at Outrider, a search-engine marketing agency, said it would have been unheard of not long ago for Google to let itself be identified as a Click Forensics collaborator.
"Two years ago, it was a very adversarial relationship," said Cowan, whose company helps advertisers manage campaigns on Google and other search ad networks.
Outrider, which has been in business for 13 years, started offering Click Forensics click-quality services to its clients about two years ago. It realized at the time that click fraud went beyond scammers clicking on pay-per-click ads for malicious purposes, such as inflating their commissions or hurting competitors, he said.
Outrider views click fraud as a broader problem that includes what it calls "unwanted clicks" that aren't maliciously generated but that nonetheless offer advertisers little or no value. For example, a company that only sells in the U.S. gets no benefit from clicks on its ads by people who live abroad, he said.
Gaining this insight, backed up by hard data from Click Forensics, lets Outrider further optimize its clients' campaigns, Cowan said. And the more confident a company is about the effectiveness of its search ad campaigns, the more it will invest in them, which is good for all parties involved, Google included.
"By buying into this, Google is simply accepting the fact that it's good to have a third party review [its ad campaigns] so that someone not connected to their company is also saying 'yes, it's working,'" Cowan said.
Click Forensics' Pellman said his company doesn't need cooperation from Google or any other search ad providers in order to collect their data and track clicks on clients' campaigns.
However, the FACTr service, which focuses on generating automated reports based on the collected data right from the Click Forensics interface, does benefit from cooperation from the search ad providers.
"Customers can now [electronically] submit a detailed evidence report in the format in which Google wants it, which is different from the format in which Yahoo wants it. And Google will accept that report and respond back," Pellman said.
In addition to Google, Click Forensics also announced on Thursday that Miva and LookSmart are now also supporting FACTr.
Click Forensics, which reports on click-fraud incidence every quarter, recently said that the overall industry average for click fraud was 16.2 percent in the second quarter of this year. "We continue to see click fraud as a big challenge for advertisers," Pellman said.
Fraudsters are getting more sophisticated and trying to make their scams harder to detect and track, lately resorting to using botnets to perpetrate click fraud, he said. "Click fraud is a big, consistent problem and it's not going away," Pellman said.