Fair Isaac is one of the leading fraud detection companies in the world, and is an organization I have a great deal of respect for. I have spoken with them in the past, and they told us they have been trying to determine if click fraud detection might be a viable business for them. At Google, we’re very happy to see organizations with scientific backgrounds in anomaly detection getting into this space and conducting research. Fair Isaac put out a press release yesterday which has gotten coverage in a number of media outlets. The headlines indicate that Fair Isaac conducted a study which showed that 10-15% of all clicks on online advertising were fraudulent. It turns out this is not true. I spoke with Joe Milana, chief scientist at Fair Isaac, today to find out what the real story was. He told me that most of the headlines and stories were wrong.
First of all, he said Fair Isaac has not come up with an estimate of click fraud in the industry – and in fact only analyzed data from a handful (fewer than ten) advertisers. And even this finding pertains to only the syndication networks and not search engines, where the majority of pay-per-click advertising occurs. In fact, they found that the rates of “pathological activity” on search engines was “negligible” (“a few percent or less”). This would imply a combined click fraud rate in the single digits even in their sample set – which they said they would certainly not generalize to the entire industry.
Fair Isaac indicated that they needed a lot more data before they could conduct a meaningful study. They also recognized the need for clean data, acknowledging the importance of using auto-tagging to remove fictitious clicks as we had mentioned to them previously. Unfortunately none of the advertisers in their initial survey were using auto-tagging to fix this problem, which results in inflated click fraud estimates.
We’re continuing to talk and I hope we’ll be able to help them further understand the challenges relating to click fraud detection, which is completely different from fraud detection in other industries. The biggest difference is the fact that it requires unsupervised analysis, something they told us they are aware of. They won’t share their methodologies with us to protect their intellectual property of course, but I get the feeling that they may not be aware of many other factors relating to the specific behavior of the Internet, web browsers, etc., which make this much more than just a generic task for existing fraud tools from other industries. I’m looking forward to talking to them more as their study progresses, and hopefully takes these and other issues into account.
Update: Search Engine Watch has additional details on this at "Fair Isaac Click Fraud Report Spreads False Alarm".
