Is Click Fraud Skewing Your Ads Data?

Listen Time 20 Minutes

Most marketers get excited when they see a lot of impressions or clicks on their ad campaigns and website pages. Not only does this usually indicate that their marketing efforts are working, but it also can help them to know where to focus valuable marketing dollars. This is great–unless that data is skewed with fraudulent activity.

Then, what was a great way to know where to invest dollars and grow revenue becomes a problem and a potential drain on budgets leaving marketers stressed out and scrambling to eliminate the ad and click fraud.

When you implement proactive steps to combat this fraud and fight the fake web, you’ll ensure your data is accurate and clean, and you can rely on it to make smart marketing decisions. Listen to Sr. Director of Growth Sales at ClickCease, Lucas Rabinowitz, an expert in fighting the fake web as he talks about click and ad fraud, how it can harm your business, and how to effectively combat it today.

Listen Now:

About Lucas Rabinowitz

Lucas has spent the last decade working in tech sales to help scale some organizations. His more recent ventures have focused on partnering with the brightest minds the Israeli tech sector has to offer to build sales orgs that put technology at the center of operations to drive excellent customer experiences. His teams endeavor to make revenue impact well beyond their headcount. He received an amazing education at Datorama from employee 10 to the acquisition by Salesforce. Now, with CHEQ, he joins the fight against the Fake Web. Battling bots, fake users, and fraudsters to maintain a valid digital marketplace for all.

Episode Transcript

Courtney
Hello and welcome to episode 21 of Smart Route I’m your host and strategic partnership manager at CallTrackingMetrics Courtney Tyson today we’re going to be talking more about click and ad fraud what exactly it is and what causes it and how marketers can prevent it in order to deliver clean data and results and here to educate us is Lucas Rabeowue senior director of growth at Cheq. A, go-to market security company that helps brands and organizations protect themselves from the fake web. Thank you so much for being here Lucas we’re excited to talk with you today and so before we get started I wanted to share a little bit more about you with our audience and what you do.

Lucas
Thanks for having me Courtney.

Courtney
Um, so Lucas has spent the last decade working in tech sales to scale help scale some amazing organizations. He actually received an amazing education at Data Rama he was employee number 10 all the way through the acquisition by Salesforce. His most recent ventures have him focused on partnering with the brightest minds the Israeli tech sector has to offer building sales orgs that put technology at the center of operations to drive. Excellent customer experiences. Lucas’s teams endeavor to make revenue impact well beyond their headcount and now with Cheq, he joins the fight against the fake web. Battling bots fake users and fraudsters to maintain a valid digital marketplace for all sounds super exciting and I’m very excited to learn more about all of this today. So let’s dive in so Lucas tell us a little bit about how click sees and Cheq got started and how they evolved over the years

Lucas
Absolutely so it’s a really interesting story if you think about kind of the the whole digital marketing ecosystem kind of got put on notice a while back. You don’t remember there was a large conference. Ah I can’t’ remember which one it was but Procter and Gamble was there and delivered a pretty scathing speech about the quality of the traffic they were getting for the the hundreds of millions of dollars they were spending and. Think that really put our founding teams’ wheels in motion at the time and obviously well before my time at Cheq. But they had ah descended from ah the 8200 unit in the Israeli military which is kind of like our NSA our CIA so they were some of the best white hat hackers in the world. And they realized that this problem of you know, fake and fraudulent traffic impacted. Yeah, go-to market organizations pretty substantially and that was kind of the first you know tipping of the iceberg if you will where a huge brand came out and said look you guys got to get your stuff together over there in this digital marketing ecosystem. They had some different solutions they built along the way that eventually evolved into you know what is Cheq which is ah a really comprehensive way to protect the entire revenue organization’s efforts which is you know the largest attacker service a company has and all the different ways that you communicate with your customers with the market with the internet with other types of systems. Ah, it’s a huge attack surface and you know something that traditionally has gone on protected so there was a big problem. They recognized there that they could help solve for businesses of all sizes it affects everybody who does business online and that’s a pretty exciting thing to be able to you know, have the opportunity to work on.

Courtney
That’s very cool. Absolutely and it’s interesting to think about how that study and this from proctor and gamble kind of sparked this I actually remember I had worked in pr at the time it sparked some conversations on that side of the fence too. Um, but ever since then as you mentioned cybersecurity has become increasingly hot topic for marketers. So um, outside of you know procctor and gamble and everything they brought to light. Let’s think about like the past few years why has cyber security become this hot topic um over the past few years

Lucas
I think obviously covid accelerated that by put forcing everybody online and it really started to make people rethink that that as an attack surface I think and also you just started to see that the problem was getting bigger. So a lot of these bots these fake users they’re automated scripts and so what started as a small problem which actually started as a pretty innocent thing. Ah, in reality there was a a cyber security researcher who was just trying to alert people using an old version of telnet that they were exposed so I’m not sure how familiar the listeners are with how the internet works. There’s about 65000 ports. They’re kind of like roads in and out of people’s computers. And this researcher found that hundreds of millions of worldwide computers were exposed and completely available to be hijacked and so what he did to try and alert people very benignly was create a script to drop a message to their computer and that technology like many technologies got out and morphed into the bot problem that we have today. And that actually means that over time it got worse because some of these bots never die. They have their programs on a loop and so over time the problem gets bigger and bigger and there are more and more ways that attackers can get at you now because of more businesses online. So I think that just compounds the problem cybercriminals tend to follow the money. And what you’ll actually see now is that I think by recent estimates. Yeah, we did a study that showed about 40% of the internet was this invalid traffic these bots and these fake users I saw a bunch of you know, big personalities in the text base recently whether it was Mark Bennyoff or Elon Musk tweeting out.

Lucas
A retweeting I excuse me some statistics around it being as high as potentially 63% invalid users on the internet and so there’s some staggering numbers and you’ll see ah slight variations in that wherever you go but the problems just getting worse over time.

Courtney
Wow! yeah.

Courtney
Yeah, and as a marketer when you think about that amount of invalid traffic hitting your paid ads that hurts your heart and hurts your budget quite a bit right?

Lucas
Nothing worse than paying for someone to come to your site to have absolutely 0% chance of ever transacting with them because it has so much downstream impact on your business and how you think about analyzing the success of your campaigns how you think about. All the tools that live on your site that are trying to create you know a great customer experience and these are some of the reasons why marketers are really focused on that right now it’s not just about whether you paid for that click. It’s about all the downstream impact on your business as well. And. Think we see some really extreme examples of that playing out in the market today I mean you saw I think Lester was 21 Paypal had four and a half million fake accounts open. They’re a pretty big fintech company and they were offering promos for $5 ten dollars referral fever familiar with these types of Coupons

Lucas
Was being abused people were scripting and opening accounts and not only did that you know waste what? what the estimate was 25 $26000000 of you know, marketing spend on the Coupons. It also had them reporting fake numbers and false numbers to the street. They’re a publicly traded company and so they’re forecasts were all inflated because like you and I know you assign an average lifetime value to these customers and that’s how you kind of get to your forecast and revenue and so when they had to write that down by you know you know all these four and a half million accounts their stock tumbled 25% overnight that’s a massive massive impact from this problem and.

Courtney
Wow. Yeah that’s an incredible story. Oh my goodness. Wow so we’re talking a lot about invalid traffic in general but let’s talk about I guess let’s can you explain the difference between ad fraud and Click Fraud

Lucas
This type of stuff happens all the time.

Yeah I think ad fraud is a bit more of an umbrella term. There’s lots of different ways you could you know commit fraud within the advertising ecosystem I think there was just recently an article in Wired about how bots had corrupted the advertising system and they had talked about this. Specific Russian personality I can’t remember his name off the top of my head thinks Alexander Zhukov if I remember correctly and he was spoofing websites New York Times specifically it was one of his targets I think Purina it also was one of his targets the pet brand and what he was doing was just spoofing fake websites. Ah that looked like their websites to put them into digital exchanges.And then selling ad space that was viewed 100% by bots that he’d created just to view the websites and the ads and so he was just openly stealing money from these ad exchanges to the tune of millions and millions of dollars ultimately he was extradited out of Bulgaria when he was on vacation ah to the US and stood trial I think he was sentenced to 10 years prison.

Lucas
That’s ad fraud. He was just literally stealing your ad budget I think there’s some more technical more tactical stuff like click fraud but you see a lot in the space where you have competitors who are just clicking on each other’s ads and sometimes they’re not doing it manually. Sometimes they’re just buying a click bot program which you can get for maybe Twenty Twenty-five thirty dollars on the dark web and just automate it to click on the keywords and this is really beneficial to services businesses because if I’m trying to get a pipe fixed or I’m trying to get something delivered to me. That’s just-in-time services I’m not going to go researching for the next five days about who I want to fix my burst pipe or change my lock when I’m locked out. And so if you drain their budget for those keywords early in the day you get all the jobs and that’s more like the click fraud ecosystem where it’s just people trying to drain budgets from each other to get an edge on acquiring new customers.

Courtney
Okay, that those are good definitions and it’s just I guess it’s upsetting right? to think that there are companies out there that would do that but I guess whatever it is to get ahead right? But it’s also just crazy to think that you can go buy a bot program. Um, yeah, just seems pretty nuts. Um, so. Let’s talk about I guess Google I think a lot of marketers right? are obviously advertising on Google doesn’t Google prevent click fraud or you know why do we need to worry about it?

Lucas
Yeah, they do a great job I think that’s one of the things where the industry gets a bit of a bad rap is that everyone acts like they’re out to get you and I think the real story is that when you look at the numbers of fraudulent traffic out there this invalid traffic you know. In organic and direct traffic. It’s usually about 27% across our customer base. That’s what we see and in the paid marketing ecosystem and in Google specifically we see about three and a half maybe 4 that’s a big delta and that delta is because they care about the quality of the traffic they’re selling you. That’s their product. And so I think that’s one of the big misnomers in the industry that marketers accuse them of not caring I think they care a great deal I think it’s an extremely difficult challenge to solve especially when it’s not your core focus in your core business and so they do a good job but they don’t do everything. It’s ah it’s very hard to stay ahead. Researchers are always finding new ways to exploit the updates every time an operating system a web browser or anything gets updated an api gets updated. There’s vulnerabilities associated with that and so you always got to stay 1 step ahead at companies like you know, Cheq and other people out there have researchers dedicated to doing just that and this is what they’ve they’ve been doing their whole lives So they’re very, they’re very good at doing that and it’s a game of whack a mole so you have to have a lot of focus.

Courtney
Um, gotcha. Um, so we talked a lot about I talked earlier about the ClickCease Tool and how it helps to block the bad traffic. But let’s talk about you know. Is there a risk to block to blocking good traffic utilizing the ClickCease Tool? So. How can you be Sure you’re not blocking the good traffic?

Lucas
Yeah, whenever you’re blocking something There’s always an inherent risk and we’re very conscious of that we want to be very conservative with how we approach this problem because the last thing we’d ever want to do as a marketer is block a genuine user and we have a lot of. Safeguards are built into the system. The clicks cease you set up your own rules. So you have to know your customer journey pretty well, there’s some legwork you got to put into to configure that to make sure you’re doing it correctly I mitigate that risk with our paradigm platform our enterprise tool. It’s extremely accurate. So 99.9% or something like that and there’s you know really very little chance of that happening because we use so many different tests but it really just depends on how much effort you want to put into that but you absolutely need to be conscious of that you need to look at your own data set up rules that make sense for what you want to block to mitigate that risk and when you do that you see quite an effective result.

Courtney
And so I would guess that the ClickCease tool That’s something you want to manage ongoing in order to make sure you’re adjusting the algorithms or the setup right? that you have in there to ensure that you are. You’re getting all of the good traffic and not blocking it.

Lucas
Absolutely And that’s something that we have a customer success team to help you with as well. You know ClickCease is generally used by some smaller businesses Upstart Businesses. You know, high-growth tech companies and more local regional businesses. And they tend to experience less sophisticated fraud and the smb in the lower Mid-market. They don’t tend to have targeted attacks as much. There are a lot of collateral damage competitive fraud which is very basic and so for them to to customize rules to their needs. Ah, we can help them and it’s a self-service platform where it’s quite easy to turn it on and off you don’t need to be like a coder. There’s toggles and buttons. It’s very very easy to use. So yeah, absolutely something you want to keep an eye on and manage and maintain. Ah, but it’s definitely a self-service thing.

Courtney
Great. So um I would say obviously the most the biggest benefit to using right? is you’re blocking that bad traffic. You’re identifying the ad fraud the click fraud. Um, but specifically Lucas what ClickCease feature do your customers find the most valuable?

Lucas
Well I think the blocking is something where they see a lot of tangible value. But we also have in our ClickCease platform a tool called botsapppping which actually lives on your website and so what that does is it texts all the traffic coming from any source whether it’s Facebook but it’s Google or direct and organic traffic as well. And it zaps the bots right? off your site so 4 ah 3 is then make sure it can’t interact with the forms and things on your page so it actually really secures your customer-facing portal which is your website and so we’ve had customers come to us saying man we get so many junk leads it creates a lot of wasted effort creates a lot of things downstream and our retargeting. Ah and they come in through these forms and By zapping these Bots off of their sites. A lot of that operational headache goes away overnight and it doesn’t always but when the source is a bot that’s very valuable to them and so I’ve seen some great success there and a lot of customers are really gravitating to that because having that on your site gives you view into everything that’s happening. And so I think that’s also an extremely valuable tool that a lot of customers are really starting to latch onto is just protecting everything and not just paid.

Courtney
Yeah that’s very interesting. Um, definitely having insight into what’s happening behind the scenes is important. So um, speaking of Click Fraud um and knowing what’s happening behind the scenes. Let’s talk about. The accuracy of data. So can you tell us Lucas a little bit more about how click fraud impacts the accuracy of data?

Lucas
Yeah mean that’s a huge problem worldwide is data right? and the cost of bad data and I think the Harvard business review put it at about $3000000000000 per year in terms of cost to businesses now. It’s not all invalid traffic. But what we actually estimate is that of that skewed data that that impact to the market as a whole that $3000000000000

Courtney
Wow.

Lucas
Think almost seven hundred billion of that can be attributed to bad data that comes from invalid traffic online. That’s a gigantic number and when you think about how much companies invest in data and analytics in terms of analysts and tools like tableau or Domo or power bi or data Rama and then. All the data sets that flow into there and like then they use tools like you know what is it fivetran or al cherics or other types of etl solutions ah to get it in there. There’s a huge ecosystem just around bringing data together and analyzing and getting value out of that data and if you were to find out tomorrow that data might be twenty-five thirty percent up. That would probably be a pretty big issue all the way up to this suite, especially if you’re making multimillion-dollar decisions about how to allocate resources and budget based on these types of interactions. So. It’s a huge problem and we’ve seen that actually be 1 of the most popular ways to solve for this is getting that data to become more available and using that data in the context of decision-making across the org. So it’s really becoming a c-suite problem and that’s a development we’ve seen over the past twelve months where they’re starting to focus on this as a strategic issue to their business and not just you know tactical you know, advertising issue.

Courtney
Yeah, it’s interesting to think about too the importance of this in the financial climate that we’re in I mean you have to maximize your budget. You have to make sure it’s working for you right? So having the tool that helps you to identify. You know what’s invalid traffic. What’s not helping you to identify what. But which of your ads are driving those legitimate clicks and which aren’t right? That’s important. Um, it’s interesting to think about, um, our partnership with ClickCease Lucas I think that CallTrackingMetrics and clicks cease or Cheq I should say right? Also have a lot in common I think that. You know we both number 1 are helping marketers to maximize their budgets through the different things that we do but in turn we we really are helping marketers to work as sophisticated as possible. Um, so you know this has been a great conversation Lucas I wanted to ask you before we conclude is there anything that you’d like to plug on behalf of Cheq or ClickCease yourself.

Lucas
I Think the one thing I’d like people to be aware of is that they should just be doing something about it whether or not they’re you know partnering with somebody like Cheq or ClickCease to solve this problem. They could also be looking at their own campaigns and doing some minor things that are manual but can maybe help mitigate the issue from the paid marketing perspective.

Things like only running campaigns during hours that you actually do business One of the big ways we see people ah wasting their budget on Invalid traffic is through spikes that come during non-business hours. So Maybe they have a huge spike of bot traffic that comes in at 3 or 4 in the morning if you’re not running ads that can’t happen so just being really smart and conscious of the fact and how you can spot these trends. And then doing whatever you can ah to mitigate that some of that could be running defense campaigns though. False representation may make that more difficult than you think on the surface. But there’s little things you should be doing just to try and maximize your budget like you said, especially in these times and. I can see a lot of value. Want you do as well giving better attribution to to those different sources and what drives the phone calls in know that’s what we all want to do is just make sure marketers are making the best possible decision attributions a piece of that but also is having accurate data and so that’s why we’re really excited to partner with CallTrackingMetrics just in helping marketers make good decisions.

Courtney
Thank you Lucas we appreciate that. Yeah, it’s been a fun ride. Um, working with you and learning all about ad fraud and Click Fraud um so just kind of conclude. Our conversation today. What we’ve learned about is that what we’ve learned I should say is the fake web is real. Ad and Click Fraud is real. We can’t keep turning a blind eye to this issue and so with that said, if you’re a marketer who’s concerned about add or click fraud you’re or you’re just looking to block the bad traffic. You want to save money deliver clean results identify which of those channels are working for you. Cheq out ClickCease o learn more Lucas has a team of people just waiting to help you drive success. And deliver results. Um, definitely connect with him and thank you Lucas for being here today and educating us on click and ad fraud this information you’ve shared today is really invaluable to marketers who are looking to deliver the best results. So thank you so much.

Lucas
Thank you for having me Courtney and really excited about the partnership to come so all good things.

Courtney
As are we and thank you to our listeners too for being here today. Um, as always we appreciate you tuning in next time for our last episode of 22 where we’ll discuss smart tech trends to look out for and 23 with Daniel Armrato from White Shark Media in the meantime keep up with us on Twitter at Smartroutepod