23 Musings

Click fraud, the bane of every marketer who deals with paid search, is currently sitting at around 16% of the clicks you may be receiving. The average rate is 16.2% and can be significantly higher on content networks.

The average rate was 13.8% a year ago and 15.8% last quarter so it is rising quite fast:

The average rate of click fraud on content networks such as Google Adsense or Yahoo Publisher Network has risen more sharply:

The graphic below shows a threat map for where click fraud can be generated:

So why this continuing rise? Well as it's coming from content networks I can only guess that it may be being generated by rogue publishers and bloggers who are auto-generating extra clicks on their sites in order to raise their income. This kind of practice could really be affecting your bottom line and giving you a falsely inflated CPA (cost per acquisition) on your paid search campaigns.

Well worth keeping an eye on! And if, like me, you have a large campaign under your remit then contact your agency asap to check that you are receiving any rebates the search engines such as Google provide.

Thanks to Marketing Vox.

Now American Airlines has sued Google for allowing other advertisers to use it's trademarks as keywords in pay per click advertising. The airline accuses Google of selling the right to use American Airlines' trademarks and service marks or "words, phrases, or terms confusingly similar to those marks" to competitors who then direct searchers to their own web sites.

This isn't the first time Google has faced such a lawsuit. Geico sued Google for the same reasons some time ago and lost, and apparently other cases are on the backburner.

This confuses me a little... We use Google extensively for PPC advertising and our highest converting keywords are our brand terms (as you'd expect). Every so often we find a rogue affiliate or competitor bidding on our brand name and we always report this to Google and they remove the offending adverts for us. To enable this kind of response we had to register our brand terms with Google. They don't really police it actively but they do take down offending ads when asked.

So if the above is possible, why don't American Airlines just ask for them to be taken down? I'm guessing that they expect Google to do this automatically and to not even allow the ads to appear in the first place. To enable that would be a hugely complex and time consuming development for Google and a fundamental change to the Adwords system. I'm guessing Google would rather not have to do that. But if American Airlines lose (like Geico) then surely Google should not be taking down our competitors ads (as it's not been deemed illegal)?

Who knows! What I do know is that brand keyword advertising is very lucrative, it returns excellent ROI and is any search marketers meat and drink. Any threat to the way brand term advertising works could have a massive impact on Googles Adwords revenue. If lawsuits like this keep cropping up it is possible Google could ban advertising on trademarked terms for all to stem the tide of subpoenas, that would make PPC a much less attractive proposition!

In recent weeks our Adwords campaign has increased in cost a fair bit. This is without any major changes to the campaigns, all of which have been running nicely and costing very similar amounts month-on-month. The conversion rate hasn't dropped much but the cost has increased a lot!

I'm wondering what's causing this? Has competition increased that much in the last couple of months that we should be seeing this kind of increase? Or is our agency missing a trick and not optimising the campaign to their usual effectiveness.

I'm going to deep dive the data over the next week or so to see if anything has gone awry, but I'd appreciate any insights from anyone who has any ideas or experience (especially from the travel industry) of the same?

Google is launching it's Checkout payment solution in the UK at last. It's been in the US for a while and although it hasn't taken over from PayPal it is making good headway. This has been partly helped due to the fact that they are not charging fees for merchants at the moment.

It's an easy to use payment solution which stores your credit card details so you don't have to retype all the time. It's also been integrated with Adwords which is a really good move, imagine click to buy from the search results in the future, that could be a really powerful tool for advertisers!

This from the EFF (Electronic Frontier Foundation):

A Bad Idea From Utah: A Ban on Comparative Advertising
March 30, 2007

The Utah legislature has quietly passed a dangerous law allowing trademark owners to prevent their marks from being used as keywords to generate comparative ads. If this law takes effect, a company like Chevrolet couldn't purchase "sponsored link" space on the Google results page when a user types "Toyota" as part of a search query--at least if the latter term is registered in Utah as an "electronic registration mark."

As Martin Schwimmer notes, Utah's own General Counsel warned the legislature that the law was likely to be found unconstitutional given the burden it would put on interstate commerce. To comply with the law, a search engine that received a search request would have to determine whether a user was located within Utah and, if so, check the search terms against Utah's registry of trademarks to prevent the unlawful triggering of advertising. The cost to search engines would be staggeringly high: "Literally millions of search requests from locations worldwide each day would be subject to verification of location."

Aside from its constitutional flaws, the law is just bad public policy. It undermines the fundamental purpose of trademarks: to improve consumer access to accurate information about goods and services. Trademarks are just shorthand terms that designate the origin of a product. Comparative advertising uses those shorthand terms to provide more information about the trademarked product and competitive products. That's why comparative trademark use is clearly protected under federal trademark law. If it weren't, Pepsi wouldn't be able to tell consumers that more people think Pepsi tastes better than Coke, and Apple wouldn't be able to make fun of Microsoft on national television every night.

The good news is that, given the constitutional problems, the law is likely to be challenged in court. But it's too bad the Utah legislature didn't heed its own counsel's advice and save Utah taxpayers the cost of defending this anti-consumer legislation.

Now, as far as I know Google will stop people from bidding on a trademarked term if they are notified of the fact. I have instigated this myself in the past when we've found someone bidding on our company name. So quite why these lawsuits are happening is beyond me, I know Yahoo etc don't apply the same controls over trademarks but with the bulk of the paid search market poured into Google I question the point of trying to ban it (also find it hard to imagine how it could be policed purely for Utah).

Google is fighting for the right to allow it's paid search advertisers to bid on trademarked keywords. This strange move seems to have come about thanks to Google's ongoing litigation with Rescuecom, the litigation has been ongoing since September 2004.

Google has filed a brief in the case this week which makes a compelling argument as to why sales of trademarked keywords to it's advertisers should be allowed. Google say that companies associate products with competitors all the time in other forms of advertising and that so doing doesn't cause confusion for customers - which is what a trademark is supposed to protect.

Google's lawyers say: "Generic brands are placed next to known brands on store shelves for the express purpose of diverting customers from the brand they are seeking to another, and their manufacturers pay for that placement,advertisers deliberately select magazine ad placements next to articles about their competitors. ... All manner of companies pay for coupon placements selected based on a customer's purchase of their competitors' products. And so on. Of course they are seeking to 'hijack' or 'divert' consumers who have indicated an interest in their competitors' products. That's the point of contextual advertising -- to target ads at consumers who are actively interested in your type of product, rather than indiscriminately at the world at large."

It's a fairly persuasive argument but in my opinion could spell trouble for Google if the rule changed. Trademark terms drive a huge proportion of our paid search traffic and it's the highest quality (and converting) paid search traffic as well (for obvious reasons). Diluting that (which any change would) could make Google a less attractive place to pump our money and make us move to other CPA alternatives even quicker than is already happening.

Yahoo's new paid search advertising system is being offered to new accounts now. Originally it was just offered to exisiting accounts in October.

Yahoo's counting on the new system as a way to grasp some market share back from Google. I believe they need more than just a new system. Simple issues such as preventing people from bidding on tradmark keywords would get Yahoo a lot more love from their advertisers.

However I do feel the main reason Yahoo can't compete with Google on paid search is due to their natural/organic search algorithm being so poor. Users go to search engines to find information, most of that information is found in the natural results so if the natural results are no good..... Without this core audience of searchers the paid results just don't get the volume of clicks and conversions that advertisers want from a pay per click campaign.

Great post on the Central Desktop blog regarding Google's amazing ability to appear top in the paid results for a number of keywords no matter how much other advertisers bid.

I quote: "Google holds the top advertisement (Adword) slot for the following key words:
intranet, spreadsheet, documents, calendar, word processor, email, video, instant messenger, blog, photo sharing, online groups, maps, start page, restaurants, dining, and books (somehow Amazon has managed to appear in the #1 ad slot for 'books').

For spreadsheet, blog and video, in addition to squatting the premium ad position, Google Products also dominate three of the first four search results.

In such cases, Google Product Links and Ads can account for up to 25% of your viewable screen resolution - 30-40% for lower screen resolutions - almost guarantying that users will click on a Google Product over any other search results, sponsored links or text ads.

What this tells me is if you are trying to advertise a product that is competitive to Google, then you'll never be able to receive the Top Ad Position, no matter how much money you bid and spend."

They go on to surmise how much this is pushing up the CPC (cost per click) for other advertisers bidding on these terms and also mentions that Yahoo does not follow the same practice.

It's a valid question, possibly slightly biased by the fact that Central Desktop are a competitor in the online office product world but it's a very good post and worth a read!

Personally I don't feel this is monopolisation, more a savvy move by Google (who wouldn't take the opportunity to drive more business to yourself) but I can see this being blogged about for quite some time.

At the time of writing this Google is no longer appearing in paid results for some of these terms, but thought this worth of comment anyway...

So we're in the web2.0 age and the web's advancing quicker than ever, new interfaces, social aspects, interaction of users with data etc etc. One thing that hasn't changed is the model us advertisers pay for things like price comparison websites, pay-per-click. Google has used pay-per-click for it's sponsored listings Adwords product sucessfully and I wouldn't imagine that will change, but for your average price comparison website which is supposed to deliver much more qualified users isn't it about time they moved to a cost-per-acquisition model?

Being in travel we use price comparison sites a lot and derive a lot of traffic from them although not a huge amount of sales. Moving to a CPA model will complement the work these sites are doing to integrate content into their offerings, they're trying to increase the quality of the visitors they send through to us and so should increase the conversion rates. Running on a CPA model could then prove to be in their interests as they may drive less clicks ultimately but with greater conversion. Staying on a PPC model would mean they will lose revenue rather than gain from all their hard work to optimise the listings.

With cookie tracking so easy to implement and fairly accurate, keeping a track of the sales isn't a problem and most people do this anyway. Moving to CPA will also remove any risks of click fraud as there will be nothing to be gained anymore.

As I said, I'm not sure Google would ever go down this route for Adwords, search is much more about driving high volumes of traffic and the visits are never going to be as qualified as those from a price comparison site. PPC seems a little old fashioned as a business model for a website that should be driving sales rather than purely traffic!

Clickriver is now in public beta. This is quite an exciting development from Amazon/A9 as they've chosen to build their own system to do this rather than syndicate Google Adsense or another solution.

The reason for going it alone is most likely because they really don't want any competing products displaying on their site. They're looking for complimentary advertising rather than competitive.

It will be interesting to see quite how much functionality there is in Clickriver. As a travel company based in the UK we'd want to only display ads on amazon.co.uk for example. We'd also only want our ads to appear when someone mentioned a destination in their search or were looking specifically at travel related products. So having this kind of functionality available to you through whatever interface Clickriver uses is really important.

As an official paid search fiend I'm quite excited by the prospects of this and it leaves scope for other companies to do similar. Tesco.com perhaps are big enough to do something like this.

This is a list of the top 50 most expensive Adwords as at September 2006. It's amazing to see the high prices some terms command. You would think there would be more competition, and therefore higher prices, for terms to do with holidays, travel, electronics etc. Some of the terms such as the ones to do with loans may be an indicator of the high debt levels currently experienced by students, which in turn is a good indicator of the economic health of the U.S. right now.

It's hard to believe that every time you click on an adword for the term 'school load consolidation' you cost someone nearly $70. It makes all the terms in the campaign I run (over 10,000 terms) seem cheap by comparison!

You can see how Google makes such a fortune out of pay-per-click!

Adword	Average CPC
school loan consolidation	$69.16
college loan consolidation	$68.35
car insurance quotes	$66.88
school consolidation	$66.29
auto insurance quotes	$65.90
college consolidation	$64.04
student loan consolidation rates	$60.14
sell structured settlement	$59.82
sell annuity	$58.92
federal student loan consolidation	$58.58
auto quotes	$58.09
auto insurance quote	$57.99
student consolidation	$56.96
student loan consolidation	$56.91
student loan consolidation interest rate	$56.52
consolidate student loan	$54.61
san diego dui attorney	$54.56
car insurance	$53.16
structured settlement	$52.96
consolidate school loans	$52.88
student loan refinance	$52.44
consolidation of student loans	$52.43
consolidation loan rate	$52.04
citibank student loan consolidation	$51.85
car insurance quote	$51.80
consolidate student loans	$51.23
private student loan consolidation	$51.05
lasik new york	$49.86
student loans consolidation	$49.82
private loan consolidation	$48.95
insurance quotes	$48.78
teleconference services	$48.72
the art institute of seattle	$48.68
federal loan consolidation	$48.61
plus loan consolidation	$47.74
student loan consolidation programs	$47.58
bad credit equity loan	$47.46
houston criminal attorney	$47.44
student loan consolidation calculator	$47.19
cash settlement	$47.12
consolidating student loans	$47.09
orlando culinary institute	$46.84
student loan consolidation program	$46.77
orlando culinary institute	$46.69
consolidation loan	$46.54
loan consolidation	$46.54
orlando culinary institute	$46.51
ditech	$46.32
auto quote	$45.77
sallie mae student loan consolidation	$45.69

I guess maybe I should move out of the travel industry and into school loans :)

Figures released by Nielsen/NetRatings show that the UK is still crazy about search and search engines.

It's estimated that 264 queries were carried out every second by UK web users during August. That staggering figure works out at 22.7 million search engine queries per day! That's an overall increase of 4% in the last 6 months.

Unsurprisingly, the majority of these queries are carried out in Google (68%), then comes Yahoo! (9.1%), Ask.com (7.8%), MSN/Windows Live (5.8%) and AOL (4.1%).

Just goes to show how important your pay-per-click and search engine optimisation (SEO) efforts are!

Interesting to hear today that Yahoo have started a trial of mobile pay-per-click advertising with 100 selected advertisers on their mobile web services. As this trial progresses they say they will be adding more advertisers.

Ii will be really interesting to see how this pans out and how successful it proves to be. Google has been aggressively partnering with mobile firms but has yet to launch any paid search activities on the small screen.

It may work well if there is some kind of quality check to ensure that the ads are relevant to the keywords, but if not I for one would not want to have to scroll through a load of irrelevant adverts just to get to the real search results!

It may be an idea for them to try an interstitial page while the search is compiling the results displaying an appropriate advert?