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1/05/2006
  How Credit Card Fraud is like Click Fraud

Marketing Sherpa has a good article for business who have merchant accounts and process credit cards - "6 Tips for Minimizing Chargebacks" (free access til Jan 15.).

What strikes me is how similar attitudes toward online credit card fraud (specifically fraudulent chargebacks) and click fraud are from the perspective of the retailer.

“The credit card infrastructure is incredibly opaque from the merchant’s point of view.” says Gene Hoffman, CEO Vindicia, a credit card fraud protection service.

'Incredibly opaque' certainly describes the AdWords system as well.

Here are some of the myths in the Sherpa article about Chargeback fraud. See if you can make the analogous statements concerning click fraud instead of "Chargebacks".

It's not hard to find similar sentiments about click fraud. Moreover, the suggested remedies are also analogous:

In AdWords terms, measure and report back to your Google rep.

If you suffer from click fraud, look at where you buy your clicks. The simplest way to minimize the effects of fraud it is to monitor your ROI.

Another option is to turn off the source of the fraud - usually the content network clicks. Often the click fraud is coming from the content network (i.e. AdSense) and you can and should separate out bidding for the content network. Make sure your content network ROI is similar to your search network ROI. If it's not, spend more on search and less on content ads.

 


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