Slide 1 Search Arbitrage: The Good, The Bad, But Mostly… The Ugly.

Slide 1

Search Arbitrage:

The Good,The Bad,

But Mostly…The Ugly

Search Arbitrage:

The Good,The Bad,

But Mostly…The Ugly

Slide 2

The Definition of Search Arbitrage

Search Arbitrage is the practice of running a PPC campaign with the sole objective being strong cost control that is below generated revenues.

Slide 3

When Does Search Arbitrage Get Ugly?

When the Arbitrager has no ownership of content and no responsibility for campaign integrity, with the primary

focus being to generate as much revenue as possible for their personal wealth rather than growing a true business.

Slide 4

In the October 2, 2006 issue of Business Week conducted an investigative report on new click fraud tactics.

Search Arbitrager were called out for tactics that ranged from pay-to-read campaigns to automated click bots to PPC-only designed search engines.

Search arbitrage and Click Fraud has gone mainstream.

Business Week Names Names

Slide 5

A McGregor, Minnesota couple set up dummy Web sites filled with nothing but recycled Google and Yahoo advertisements. In just 4 short months, this couple made $20,000, commenting, "it was way too easy" to essentially fool the engines.

A 23-year-old Hungarian millionaire Roland Kiss, who rakes in $70,000 in ad revenue per month by engaging his "Paid to Read" membership to click on his recycled search with instructions on where, when and how often they should click.

These Arbitragers admit they must follow strict practices in order to receive payment so that the click fraud will go undetected by search engine detection algorithms.

Search Arbitrage Fraud Highlights

Slide 6

Keep The Internet Ecosystem Clean

Users

Advertisers

Publishers

Give them what they want the first time

Maximize ROI

Maximize earnings

with useful ads

Slide 7

The Ecosystem Attacked

Slide 8

The Ecosystem Attacked

Slide 9

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Information aboutCypress Trees

VER The Top

RELATED TOPICS

The Ecosystem Attacked

Slide 10

Related Topics:

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The Ecosystem Attacked

Slide 11

Causing extra clicks drives users away

We have done the work for you: Cypress Trees

Information

SUPER FREEWAY

The Ecosystem Attacked

Slide 12

CYPRESS TREES

The Ecosystem Attacked

Slide 13

The Ecosystem Attacked

Slide 14

Are These Tactics Fraud?

YesNo

Slide 15

What Are Yahoo’s Publisher Policies?

Slide 16

What Are Google’s Adwords Policies?

Slide 17

What Are Google’s Adwords Policies?

Slide 18

What Are Google’s Adwords Policies?

Slide 19

The Ecosystem Restored

Slide 20

What’s Google Doing About The Problem?

In July, Google made a significant change to the Adwords Quality Score algorithm, including landing page relevancy into the equation.

Google search bots began crawling your site, evaluating your landing pages, and determining the relevancy of the page coding to the searched term and its associated ad copy.

In Early November, Phase 2 rolled out, applying the same algorithm to the Content network.

Additionally, Google deep another deep crawl with an improved model across Adwords networks to clear out more of the bad guys.

**As summarized by my Google contacts**As summarized by my Google contacts

Slide 21

What’s MSN Doing About The Problem?

MSN has been slow to react, but their need to react were not as significant as Google’s needs.

Upon rollout in May, MSN was clean and user friendly…but by August the Arbitragers found a new home.

Last week, MSN began its first efforts to combat the search arbitraging efforts by changing its policies as it relates to display URL usage.

Slide 22

What’s MSN Doing About The Problem?

MSN will be changing its policy on multiple pay per click search ad listings showing the same display url. Historically, more than one listing with the same display url could show on the search results page. The new policy discontinues this activity.

Visibility on keywords will be limited to one ad per display url. Should two ads be bidding on the same keyword, the ad with the highest click thru rate will be displayed. This is an important change to be aware of as it differs from Google’s display url policy.

Unlike Google, in MSN ownership of the actual display url does not grant the advertiser the right to have their ads shown above affiliates or display url pirates. MSN feels it is up to the advertiser to monitor their affiliate’s activities including utilizing inappropriate display urls.

**As summarized by my MSN contacts**As summarized by my MSN contacts

Slide 23

What’s Yahoo Doing About The Problem?

?

Slide 24

How Do We Solve This Problem?

Search engines need to develop specific requirements and enact strict enforcement in the terms of use on the amount of "other" content required to show paid ad listings. Pages that don't have any meaningful content clutter up the Web and should be either removed, or at the least, engines should not allow them to carry their listings.

There must be specific requirements and guidelines on acceptable practices for impression generation. Illegal, false and misleading advertising must result in immediate legal action and program expulsion.

All entities involved -- the engines, advertisers and intermediaries -- need to jointly develop a blacklist of all suspected fraud perpetuators and share that information for mutual protection.

There should be a manual daily review of each partner site that delivered traffic to see whether they are in violation of any of the guidelines.

Set up an industry task force that reaches beyond just the search engines bonding together, as advertisers and SEM firms have much more insight into the click fraud problems.