The year 2020 was a challenging time for many businesses all over the world.
With the worldwide pandemic causing havoc for retailers, many businesses shifted their stores online during the global lockdown restrictions.
And with a huge surge in e-Commerce and online shopping, many of these businesses experienced a new threat that they have never encountered before.
Known as click fraud, this threat has increased significantly as many retailers have turned to running online ads on the likes of Facebook and Google.
As a click fraud prevention platform, we’ve helped many clients deal with this increase in fraudulent activity over the past 12 months.
In our first Global Click Fraud Report, we’ll be taking a look at some of the key findings from the past year and how click fraud has affected advertisers.
To read our full Global Click Fraud Report, including our 2021 predictions and more key statistics from our research, be sure to download the full report.
About This Study
Here at Lunio, we help clients protect themselves from invalid traffic and clicks with our click fraud detection platform.
Over the past year, we’ve tracked over 1 billion ad clicks from a range of different advertisers in countless industries and niches. Through this first-hand data, we’ll be highlighting the most critical industry changes we’ve observed to help advertisers better understand this challenging threat.
Our aim is that this report will help advertisers fully understand the dangers of click fraud and how much of their ad spend could be at risk.
Key Report Findings
- Only 13% of accounts monitored had little to no fraudulent or invalid activity.
- 36% of display ad clicks are fraudulent or invalid.
- 17% of CTV impressions are fraudulent or invalid.
- 11% of search ad clicks are fraudulent or invalid.
The key findings from our report show that click fraud is on the rise, and now 87% of online advertisers experience some kind of fraudulent activity on their ads.
Display ads received the highest amount of click fraud based on our client data, with 36% of all clicks being fraudulent.
Connected TV (CTV) ads took second place with 17% of all impressions being fraudulent. In recent years, ad fraud operations like DrainerBot & Methbot have specifically targeted YouTube ads and other CTV networks to defraud advertisers.
Last but not least, on the most frauded type of ads were search ads with 11% of all clicks being fraudulent. Since Google doesn’t split ad revenue from search ads with partners, only competitors have the incentive to fraudulently click them, resulting in much lower fraudulent activity rates.
The Impact Of COVID On Click Fraud
With COVID dramatically changing the way customers shopped in 2020, this also had a significant effect on the rates of click fraud seen across multiple sectors.
From our first-hand data, the health & medical industry saw the biggest increase of click fraud at 53% compared to the same April – July period last year. With many businesses taking advantage of paid ads to promote face masks, vitamins and antibody tests, it makes sense that the increased spending attracted more fraudulent activity.
The only two sectors that saw decreases in click fraud rates were travel and local trade. Both because businesses in this sector would have suspended or heavily reduces their ad spend during the pandemic restrictions. Fewer ads always mean fewer fraudulent clicks.
Click Fraud By Industry
Taking a step back and looking at the click fraud rates of industries as a whole, we found the highest level of click fraud in the education sector.
As thousands of children were confined to their homes during the lockdown restrictions in many countries, a large number of parents turned to online education platforms. As these companies increased their ad spend, they also saw the 2nd largest increase in click fraud rates and the highest fraudulent rate of 31.14%.
At the same time, many other sectors significantly reduced their ad spend with advertisers pulling the plug on travel ads. This resulted in them having the lowest click fraud rate of 12.47%.
Due to fewer ads and lower competition, the cost per click of these travel ads reduced significantly, forcing click bots and fraudsters to target more profitable industries.
Click Fraud By Country
Just like we analyzed how different sector’s click fraud rates increased and decreased over the past year, we also analyzed specific countries click fraud rates.
From our data, we found that Australia and India click fraud rates both increased by 37% compared to last year, with many of the other countries also seeing double-digit increases.
On the other side of the scale, Germany saw the lowest increase at only 11% while the UK had the second lowest at 26%. Germany’s much lower growth is likely due to the country being a relatively small digital ad spender per capita compared to other countries of similar development and size (e.g. the UK).
Most Common Types Of Click Fraud
There are many culprits behind the act of click fraud. If you thought it was just competitors clicking your ads, then think again!
From our research, we found that 38% of fraudulent clicks were related to bot traffic in the form of auto clickers, scrapers and malware. Compared to competitor clicks that only came in at 17%, bot fraud is twice as likely to be the cause of ad fraud for advertisers.
Interestingly, in our recent survey of 410 PPC marketers, over 50% of respondents thought competitor click fraud made up at least 45% of all fraudulent activity.
That’s over two times the actual figure, indicating that many PPC advertisers wrongly think competitor activity is costing them significant sums of money, when in fact other sources are much more harmful.
Read The Full Report
Hopefully, you’ve learned a thing or two about the current state of click fraud and how it’s changed over the past twelve months.
If you like what you’ve read, then you’ll be pleased to know that this article was only a summary of our click fraud report.
To read more about the future of click fraud and our 2021 predictions, be sure to download the full version of our Global Click Fraud Report below.