Click Forensics today reported that the overall industry average click fraud rate for pay per click (PPC) advertising was 13.8 percent in the first quarter of 2009, down from 17.1 percent in the fourth quarter of 2008 and 16.3 percent in the first quarter of 2008. The lowest rate in the past four quarters was 16 percent, in the third quarter of 2009. The president of Click Forensics, Tom Cuthbert, said that the drop in click fraud appears to be due to “the drop in keyword Cost Per Clicks (CPCs) and the progress Yahoo! and Google made blocking click fraud from botnet sources”. Click Forensics reported seeing an increase in click fraud from malicious JavaScript programs in the first quarter, with ad networks being especially vulnerable to attacks. Click Forensics gathers it’s data from online advertising campaigns for both large and small companies from both major search providers and over 300 ad networks.
Category: Online Advertising
Yahoo Increases Share of US Search-Ad Revenue in Q1
Yahoo increased it share of US search-ad revenue to 19.3 in the first quarter of 2009, up 1 percent from the year ago period, according to search marketing firm Efficient Frontier. From the year ago period, Google dropped .9 percent to 72.3 percent and Microsoft dropped 1 percent to 3.5 percent. Google had a click-through rate (CTR) of 2.38 and cost per click (CPC) of 54 cents in the first quarter of 2009, Yahoo CTR of 1.16 and CPC of 42 cents, and Microsoft CTR of 2.19 and CPC of 52 cents. The data is based a subset of Efficient Frontier clients and is comprised of over 84 billion impressions and 785 million clicks.
Online Advertising Grew 2.6 Percent in Fourth Quarter
Online advertising revenue reached 6.1 Billion U.S. dollars in the fourth quarter, an increase of 2.6 percent over the same period last year, according to a report (pdf) by the Interactive Advertising Bureau and PricewaterhouseCoopers. Fourth quarter revenue was 4.5 percent higher than the third quarter of 2008. Revenue for 2008 reached 23.4 Billion U.S. dollars, an increase of 10.6 percent over 2007. Search advertising revenue show the largest increase of any format, an increase 20 percent to 10.5 billion dollars in 2008. Display advertising revenue, which includes display banner ads, rich media, digital video, and sponsorship, increased nearly 8 percent to 7.6 billion dollars. Classifieds revenue decreased 4 percent to 3.2 billion dollars, referrals/lead generation revenue increased 6 percent to 1.7 billion dollars, and e-mail revenue decreased 4.5 percent to .4 billion dollars. Performance based advertising accounted for 57 percent of revenue, with cost per thousand (CPM) accounting for 39 percent and hybrids accounting for 4 percent.
Google Brings Behavioral Targeting to Content Network
Google today announced the launch of behavioral target advertising on the Google content network. The advertising, that Google calls “interest-based”, will show ads based on categories of interest of the user determined by the “types of sites you visit and the pages you view.” Google says that a limited number of advertisers will be offered the chance to use “interest-based” advertising as part of a beta, and that the offering will be expanded later in 2009.
To deal with privacy concerns Google touts the fact that most ads it provides include a label that includes links to “get more information about how we serve ads, and the information we use to show you ads”. Google has created a tool called the Ads Preferences Manager that allows users to view, delete, or add interest categories associated with the advertising cookie in their web browsers. They also allow users the option to opt-out of the advertising cookie and have provide a plug-in to insure that the opt-out cookie is no deleted when a user clears out the cookies in their web browser.
Major Web Publishers Introduce Larger Display Ads
A group of the web’s largest publishers have announced they will begin to support three larger ad units. CNN, ESPN, MTV Networks, New York Times, and other publishers that are part of the Online Publishers Association will begin to offer at least one of the advertising units by July 1. Some of the publishers have already introduced the ad units on their websites. According to Online Publishers Association the participating sites had “unduplicated reach of 108.3 million visitors, or 66 percent of the total U.S. Internet audience” in January. The Assocation says that new formats will only be available through the publishers’ direct sales teams and not through ad networks that that some publishers blame for declining display ad pricing.
The new ad units are:
The Fixed Panel (recommended dimension is 336 wide x 860 tall), which looks naturally embedded into the page layout and scrolls to the top and bottom of the page as a user scrolls.
The XXL Box (recommended dimension is 468 wide x 648 tall), which has page-turn functionality with video capability.
The Pushdown (recommended dimension is 970 wide x 418 tall), which opens to display the advertisement and then rolls up to the top of the page.
Google Testing Expandable Ads on Content Network
Google has begun testing expandable ads, ads that expand in size when clicked on, on the Google content network. The ads will be limited to expanding to double the original size and can “include a streaming video or other content designed to engage users through an interactive experience.” In addition to limiting the size of expanded ads, ads will expand only after a user clicks on the ad, ads will be required to be able to be closed by the user at any time, and ads must comply with Google’s standard AdWords image ad policies. The ads are price on a cost-per-click (CPC) or cost-per-impression (CPM) basis, CPC ads will only accrue clicks when a user visits the advertisers landing page and not when a user clicks to expand the ad. According to a post on the Inside AdWords blog the test is currently limited to the U.S. advertiser who advertise through Google’s 3rd Party Ad Serving program and the test will be expanded, but no details were given.
Google Brings Ads to News Search Results
As part of Google’s continued expansion of advertising to it’s various search products they have now added text ads to search results pages on the Google News search. This follows the introduction of text and display ads to Google Image Search last year. The ads are currently displayed only in the United States. According to post on the Google News Blog, Google has in recent months “been experimenting with a variety of different formats, like overlay ads on embedded videos from partners like the AP” in Google News search.
Yahoo Adds Ad Scheduling and Demographic Targeting To Search Advertising
Yahoo today announced that they would be adding ad scheduling and demographic targeting to their search advertising service in March. With ad scheduling Yahoo will support varying bids based on what time of day and day of the week ads will run, which Google and Microsoft already support in their search advertising products. With demographic bidding Yahoo will support varying bids based on age and gender of searchers, which Microsoft already supports. In addition, Yahoo has added the option to show display advertising on the Yahoo Network targeted to users who performed searches on Yahoo for a given keyword.
Yahoo Adds Image and Video to Ads in Search Results
Yahoo has started a new advertising service that displays image, video, and other ads formats to the paid listings on search results pages. The services supports displaying images and video, text input boxes for searching for specific products or finding a store location, additional text links to relevant page, and brand logos. The Rich Ads for Search service is currently only available by invitation. According to a New York Times article, Yahoo is charging a monthly fee for the service. Yahoo claims that small group of advertisers that tested the service in fourth quarter of 2008 “saw click-through rates rise by as much as 25 percent” and improved conversion rates.
FTC Finalizes Self-Regulatory Principles for Behavioral Advertising
The U.S. Federal Trade Commission has released a finalized report (PDF) on their self-regulatory principles of behavioral advertising. Behavioral advertising involves using information about consumers’ online activities in order to deliver tailored advertising. The guidelines, which were originally issued in December 2007, were revised based on 63 comments by approximately 87 stakeholders. The major change in the principles was to remove first party, “behavioral advertising by and at a single website”, and contextual advertising, “advertising based on a consumer’s current visit to a single web page or a single search query that involves no retention of data about the consumer’s online activities beyond that necessary for the immediate delivery of an ad or search result”, from the scope of the principles. The U.S. Federal Trade Commission has released a finalized version of their self-regulatory principles of behavioral advertising. Behavioral advertising involves using information about consumers’ online activities in order to deliver tailored advertising. The guidelines, which were originally issued in December 2007, were revised based on 63 comments by approximately 87 stakeholders. The major change in the final version was to remove first party, “behavioral advertising by and at a single website”, and contextual advertising, “advertising based on a consumer’s current visit to a single web page or a single search query that involves no retention of data about the consumer’s online activities beyond that necessary for the immediate delivery of an ad or search result”, from the scope of the principles. The FTC’s self-regulatory principles are group under four central tenets: Transparency and Consumer Control; Reasonable Security, and Limited Data Retention, for Consumer Data; Affirmative Express Consent for Material Changes to Existing Privacy
Promises; and Affirmative Express Consent to (or Prohibition Against) Using Sensitive
Data for Behavioral Advertising.
In an interview with the New York Times, the acting director of the FTC’s bureau of consumer protection Eileen Harrington called on Internet companies to better explain how they collect and use data. She said that it is commonplace for them to place that “information in the midst of lengthy and hard-to-understand privacy policies” and that “We know advertisers can get their messages across when they want to. They darn better want to get this message across: ‘This is what we are collecting and this is how we are using it.'”