The seagull in this early morning photo (click to enlarge) from Long Beach, N.Y. had a "fresh start". It appears that Google has the same thing, AND MORE, with the reintroduction of an old way of dealing with "problem advertising" (Click Fraud in this case) that is deemed the publisher's responsibility.
Danny Sullivan said in this 3/8/06 SEW Forum post that "It's a fresh start to remove four years of liability for $90 million." The reason I emphasize "AND MORE" is due to the fact that for many years, my reps and I sold industrial directory advertising (print, CD, and Internet), and the "SOP" for problem ads was giving a "MAKE GOOD". I was surprised to see attorney Eric Goldman's "Lane's Gifts Click Fraud Lawsuit Near Settlement" have those exact words in his blog post. Why? Because, that advertising term had two implications to me with my background that I haven't seen mentioned yet, and will now explain. I wonder if "MAKE GOODS" will become a legal precedent?
First, a "MAKE GOOD" is the best deal that a publisher can cut with their unhappy advertisers. This is true since the publisher actually provides an opportunity to have the advertiser get more proof of the kind of ROI they provide, thus "selling" the advertiser further on THEIR service. The hope is that the advertiser will get some great new accounts or sales that will make them even more dependent upon that publisher. This additional free advertising may even be purchased with "price increased" credit dollars.
Second, this concept is not new, however even though the exact terms of the proposed settlement have not been disclosed yet, it is probable that Google will only be responsible for specific, agreed upon, click fraud click dollars and no more. Even though Google may be generous in allowing "debatable clicks" to be compensated, they probably will not do what my reps and I used to do. We gave a credit of up to THREE TIMES the cost of the ad in EXTRA FREE ADVERTISING to be used any way the advertiser wanted. This was done because of what I said first, and because it avoided any CASH CREDITS on the part of the publisher. It also avoided any "contraes" (commission charge-backs) to the sales agents by the publisher.
In my opinion, the question is not only "Who gets the credit?", but also is there any legal & financial responsibility passed on to the Google Advertising Professionals as agents who "might run an advertiser AdWords system in an account the agency owns, rather than one the advertiser owns themselves." The good thing about "on paper only" credits vs. "cash refunds" is that there is probably less of a chance of Google ever trying to fund part of their "cash refund" by going after their agents. I don't know if there is any legal & financial responsibility for the agents in the first place, so I've e-mailed Google with that question. UPDATE - Google's Reply = "As a Google Advertising Professional, you do not have any legal or financial responsibility regarding this issue." Here is the Google Advertising Professional Agreement: Download gap_terms_conditions1.doc . Also see "How Much Money Does Google Keep From AdSense Clicks?".
In fairness to Google, here is Google's Official Response to their 90 million dollar proposed settlement payout regarding what they call "invalid clicks" vs. "click fraud". The irony for me is the truth in: "What we have seen so far is that advertisers continually increase the amount of money they spend, which suggests that they are pleased with the return delivered by their ads." This may prove that Google's PPC ads work, but the proposed settlement still doesn't address, as Eric Goldman says: "...what constitutes click fraud and when search engines are on the hook for it." The "Official Google Blog" says: "We do not know how many will apply and receive credits,..." Yet, this 3/10/06 ClickZ article says: "...search engines are making a decision about what constitutes a valid click without having some of the more crucial information required to make that decision, including site visitor behavior, clickstream, and conversion data."
So, when Forbes.com says "Google's Click Fraud Settlement Seen As Non-Event", I disagree. I agree more with John Battelle who was quoted at the bottom of Eric Goldman's blog post as saying "settlement is a major victory for Google....I think the folks at Google are pleased as punch with the deal."
5/5/06 Postscript: Update = "Advertisers To Get Notices From Google In Click Fraud Settlement Later This Month".
5/22/06 Postscript: Update = "Google Sends Settlement Notices In Click Fraud Class Action Case".
5/26/06 Postscript: Update = "Google's Click Settlement: Should You Opt In or Out?".
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