Over the past few weeks, big affiliate advertisers on Facebook have reported a spike in fake clicks, but this is only part of where Facebook has faced challenges within its ad network over the past few months. The reason for the surge in fake clicks is a result of a number of things including the creation of Facebook ad scrapers that are being used to track advertisers’ ads on the site and what pages the ads are linking to.

An Affiliate Land Rush Begins

Prior to exploring the current claims for click fraud, I thought it would be important to discuss some background. Back at the end of January Facebook switched their ad policy to allow the promotion of ringtones, dating, quizzes, freebies, work at home products, and surveys. While the exact reason for this is unknown, we can assume that it’s because Facebook wanted a taste of the massive affiliate marketing cash that’s available.

We’ve been exploring extreme affiliate marketing ads over the past few weeks in what we called the “race to the bottom” for ad networks and developers, but Facebook hasn’t exactly kept their hands clean in this matter either. For those that are unaware of what affiliate marketers are, they are the middleman (or middle-woman) between customers and product offers on the internet. Wikipedia defines Affiliate Marketing as “Internet-based marketing practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate’s marketing efforts.”

Many of these affiliates have been in the space for a long time and have amassed large amounts of cash to the point that some were looking to spend upwards of $30,000 a day through Facebook’s ad network. The result is that upwards of a million dollars a day could be generated on Facebook through affiliate marketing ad spends. With Facebook looking to increase their revenue, this was most definitely a quick way to generate some cash and for a few lucky affiliate marketers, an opportunity to jump into an unsaturated market.

With Rules Relaxed, Advertisers Get Aggressive

As Facebook began to relax their rules on what advertisers could promote, the company witnessed a jump in revenue with the new surge in affiliate marketers. By March, Facebook had adjusted their advertising terms of service to include a new segment (which we’ve previously written about):

Subscription Services

• The advertisement of Subscription Services must comply with the conditions noted below and as determined by Facebook in its sole discretion. “Subscription Services” may include sites that promote downloading ringtones, wallpaper, or text messages for predictions, love life advice, news, personality quizzes, or other entertainment services or any site that induces a user to sign up for recurring billing of a product or service.

By then, not only was Facebook experiencing a jump in affiliate marketers through their own ad network, but platform ad networks had begun pushing the limits heavily. Within one month Social Cash had launched their headliners ads. Within little time Social Reach and Social Hour launched similar ads which were pushing the limits of the platform terms. In other words, the most aggressive affiliate marketers now had a substantial presence within the Facebook economy.

Click Fraud Rises

With these new advertisers and bigger advertising campaigns came the need for new forms of competitive analysis. Some developers began creating and selling new tools that would scrape Facebook’s ad inventory to give deep insight to advertisers. Want to know what’s being promoted around the site? Want to know what affiliate codes are being used? Extremely valuable data was becoming available but at the expense of some of the advertisers.

Over the past few weeks, affiliate marketers began reporting a huge spike in clicks that either never occurred or took place from a single IP address. While the source of those clicks have not been confirmed, it appears likely that the new bots that had been created for competitive analysis, were resulting in huge levels of “click fraud”.

For those unaware of what “click fraud” is, according to Formic Media, it’s “A type of internet crime that occurs in pay per click online advertising when a person, automated script, or computer program imitates a legitimate user of a web browser clicking on an ad, for the purpose of generating a charge per click without having actual interest in the target of the ad’s link.”

Google has had ongoing issues with click fraud, including numerous law suits over the past few years. While bots are a standard source of click fraud, in these cases (as Mike Arrington points out) some clicks are never even showing up in log files. It’s a serious issue, and one I’ve been hearing about for weeks directly from advertisers.

Many in the Wickedfire forums have suggested that they are turning off their ads, and while many may avoid pausing their campaigns, it’s a serious issue for the rapidly growing network. While the issue will most likely eventually be resolved, it could be costing many advertisers a lot of money.