The Google and the 'Click Fraud' Menace

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Case Details:

Case Code : MKTG120
Case Length : 9 Pages
Period : 1998 - 2006
Pub Date : 2006
Teaching Note :Not Available
Organization : Google Inc.
Industry : Online Advertising
Countries : USA

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The Phenomenon of Click Fraud

Click fraud usually referred to clicking of online ads on purpose without a genuine intention of buying or knowing more about the product or service. These invalid clicks, done manually or through software programs called 'online bots,' tended to drive up advertisers' costs and eat up promotional budgets without generating any commensurate return...

Quantifying Click Fraud

Internet search giants like Google and Yahoo! knew that click fraud posed a threat to their business. In December 2004, at an investor conference, Google's Chief Financial Officer George Reyes (Reyes) admitted the threat of click fraud to Google's business. He said, "I think something has to be done about this (click fraud) really, really quickly, because I think, potentially, it threatens our business model." Analysts and search engine marketing experts found it difficult to get the actual figures or quantify the number of click frauds that were taking place...

Marketing Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

Combating Click Fraud

With reference to the specific methods used by Google to identify invalid clicks, Shuman Ghosemajumder, Business Product Manager for Trust & Safety at Google, said, "There are many things we do to detect invalid clicks, including looking at duplicate IP addresses, user session information, network information, geo-targeting, and browser information...

Future Outlook

Advertisers began to closely monitor their customer conversion ratio with corresponding changes in the pay per click ratio. They also monitored their site logs regularly and reported any suspected case of click fraud to the respective search engine for further action. Installing fraud tracking tools on their website to curb this menace was also considered. Helping online advertisers counter the threat of click fraud became a hot business opportunity. Many Internet marketing and search engine optimization firms offered consulting services and software products that helped detect and prevent click fraud...


Exhibit I: Market Share of Online Search Engine Companies (2005)
Exhibit II: Internet Advertisement Revenues by AD Format (in %)
Exhibit III: Brief Profile of Google
Exhibit IV: Brief Profile of Yahoo!

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