If you are a novice Internet marketer and read the wrong news article, you are likely to be scared away from spending any time or money on pay-per-click (PPC) advertising. Who wouldn’t be scared upon reading that up to 40 percent of paid-for clicks may be fraudulent?

If you somehow miss the many scary articles, however, and listen only to the search engines themselves, you are likely to dive right in. PPC is perhaps the fastest growing form of advertising and search engine representatives say fraud losses are small.

Not surprisingly, for the majority of direct marketers, the reality is somewhere between the two extremes. In other words, click fraud is a real possibility and something a responsible direct marketer will work to minimize but no reason to fear PPC advertising.

Broadly speaking, click fraud occurs when an individual (or piece of code) purposely clicks on a paid advertisement with no intent to purchase the advertised product or service and in order to cause the advertiser to incur a PPC fee.

There are a couple of different types of click fraud of concern to the direct marketer: affiliate and competitor fraud.

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