The issue of PPC fraud has been gaining publicity recently.

PPC Fraud what is it.

PPC frauds work by people either repeatedly clicking ads hosted on their own websites in order to generate revenue, or targeting the search terms purchased by competitors with the aim of draining their marketing budgets.

A recent Report from Click Forensics estimated that over 14% of clicks where fraudulentAnd us market research firm Outsell estimated advertisers may have spent €637m on bogus clicks last year.

Obviously the authors of those reports do have a vested interest in talking up the problem however it is a real problem and Bruce Schneier has a short article in the latest issue of wired his comment is the way to solve the problem is to change the rules of the games so scammers had no incentive – Google’s latest cost per action add system is one way of doing this. CPA is where unless the customer performs a certain action: buys a product, fills out a survey, whatever.

Bruce comments “It’s a hard model to make work”And from a developers back ground i would agree  this sort of tight integration with Google is both harder technically and also gives Google data about your business you may not wish a third party to have.  But It will solve the old problem in advertising “50% of advertising is wasted – I just don’t know which 50%”.