Measuring Profits And The Easy Anderson Click Fraud Formula

How To Drastically Put More Money On The Bottom Line For You And Your Clients By Measuring What Is Going On

“What’s measured improves”

– Peter F. Drucker

How To Determine Click FraudNo matter what area in your business from your website to your social media, to your sales, you need to measure them and track them if you want them to improve.  While this may seem elementary, most businesses we work with do not do that. Or if they do, they don’t measure the right things with the right tools.

No matter what you are doing with your business, by simply starting to measure your ROI on everything that you are doing, you can improve your performance by 20%, 80%, even 200% in a short period of time.
So let’s look at some examples.  You have an ad campaign with Facebook, Google, or some other platform? You should know the ROI on a daily basis.

Are you doing SEO? Are you measuring things that matter? How many sales are you getting from it?  Are you even tracking the sales the come from it?

How about word of mouth? Are you using coupon codes or referral bonuses for those people that do refer you business?  If not why not?

How about your over all accounting?  Your AP, your AR? Do you have a dashboard that you look at first thing in the morning that tells you how many sales came in and where from and how much money is going out that day?

Again these may seem like basic common sense ideas, but the fact of the matter is these are only implemented in less than 1% of the companies that we work with.

However those businesses that do this, dominate their niche and not by just a little bit, they own it and you can too.

If I were going to give out one piece of advice for a business or company even if you are a one woman shop working in your pajamas in your bedroom, that would be get your reporting dashboard set up before you get going so that you can understand and not guess exactly what will be making you money.

Once you do this you will start to see ratios and once ratios are started they have a tendency to continue.  And once you see a ratio any ratio can be improved.

What I mean by this is if you have to contact 10 people to get to sales then you know that out of every 10 people and get to sales if we contact 100 people we will probably get 20 sales.

Once you know this, then you can plan out your sales program and budget accordingly.  Not only that but a simple 5% improvement in conversions will increase your profits by 25%.

Now do you see the beauty of what I’m talking about here?

The reason why I bring this all up is that we are building dashboards for a number of our clients and our own products right now.

While doing this were looking at the various tools and data sources that are available to get these numbers.

And I will pass this along to those of you that are interested.  Virtually all of the SEO reporting tools and the ad word tools that exist out there are putting off grossly incorrect data.

Right now for SEO for instance the only data we trust is information directly from Google and what we’re seeing on our server reporting tools.

Measuring Click Fraud With Your Ads

If you’re running PPC or SEM ads, or Social Media ads just be prepared about 20 to 30% of that those numbers that you’re seeing are going to be fraudulent clicks. With Social Media, these numbers can be closer to 50%. The easiest way to spot this is to check your bounce rates against your normal SEO visitors whenever you’re running ads.

Here is the Easy Anderson Ad Fraud Formula that should give yo a pretty accurate % rate on your online campaigns.

Compare your bounce rates from your SEO visitors or organic visitors against your ad visitors.

First take your bounce rate from your pay per click visitors which is almost always higher although in reality it shouldn’t be. 🙂

Let’s say it is 38% and your then we take your Organic visitors that come in from SEO which is 25% and minus that. We end up with 13%. Then you multiply that by at least 2 as a minimum and there you have a pretty good idea on your bogus click through rate. In some campaign on some services it can easily go as high as 3.5 but if you use 2, then for the most part, it is fairly accurate.

38% – 25%   = 13 x 2 = 26% Click Fraud

How To Determine Click Fraud

This can happen because where your advertising channel does not have the audience for you product, your keywords are too broad, you are not using the right kinds of ads, your ad company gets kickbacks, they are lazy, they are incompetent, the channel you chose has lots of fake users, the sites you are on clicks to make money on your ads etc.

We can go into how this happens in more detail at a later time, but you can almost bank on those numbers. Now if you actually have someone that has their act together and knows how to run a tight campaign, then your difference should be at 5% or under.   But most PPC/SEM companies are flipping sloppy and they make money regardless so you can get easily screwed if you are not careful.

Well, I could turn the ins and outs of online advertising into a virtual tome but I do not want to get off track. Advertising is just one part of what you need to measure accurately, but the thing that you need remember is figure out how to start measuring as many aspects of your business as possible as quickly as possible.

And once you do that you will find things that just pop out at you that you didn’t notice before that can be easily improved that can dramatically add to your bottom line faster than you ever thought possible.

Drucker was right in spades!


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