The CEO of search stud Google is relying on theory to combat his biggest threat to his company’s
main only real revenue stream. Google never ceases to amaze at what they’ll provide for guidance to an industry craving it.
Click fraud rears its’ ugly head every few months and lawsuits seem to be coming much more frequently. This is a pot that is starting to boil and unless the masses are put at ease it might boil over something fierce.
My three big issues with this are:
1. Adwords advertisers are really not as savvy as you think.
Many will not come close to understanding that a script is capable of clicking on their ad and that the script probably won’t complete a transaction. Google is reaching out to get more advertisers - the mom & pops - and these are especially the people they are going to be expecting to regulate their own spending to account for fraud.
2. Google is benefitting from the fraud.
Click fraud is NOT a “cost of doing business.” Retail companies like wal-mart or target have a real number associated with things like shoplifting. This is truly a “cost” to them. If advertisers pay less for more volume that includes click fraud it doesn’t really matter to Google since they make up for it on the volume side of things. This is a revenue of doing business for them. They win either way. The only loser is the less sophisticated advertiser that isn’t able to track that they are getting a lot of fraud through some of their spend. Another way they are benefitting is by providing analytics tools to those less sophisticated advertisers. You can’t track it well enough to know? Oh, well here, use this…nevermind that we get all your data, now you at least know how much you SHOULD be bidding. I don’t like the road this goes down one bit.
3. Would you base your revenue model on an economic theory?
I love economics. I think it’s fascinating. But it’s the type of thing that can be debated and debated forever. You can’t have your perfect market anywhere. There are too many variables to be saying everything will all work out because of a basic economic principle. With that I add the Click Fraud Do Nothing Solution to the “sounds good in theory” list:
- Affirmative Action
- “Made In the USA”
- College education
- Phones that play MP3’s
- Global warming
- War on Terror
- Farm subsidies
- Online voting
- Social Security
- Domestic beer
- Any food or beverage with Light in its name
- Any DVR that isn’t a TiVo
- Bars where if you drink every color without standing up from the bar you ge the drinks free
- Similar: Super Burger or Steak meal challenge
- DVD players in family vehicles
- No Child Left Behind
- A little nookie in a hot tub
*thanks to Mr. BimmerGeek for some of these
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