27% of Web advertisers pulled back their budgets due to click fraud

Outsell estimates click fraud as a $1.3 bln problem. 27% of advertisers have already slowed or stopped their pay-per-click advertising, including 16% in this group who have curtailed spending altogether. The average spending reduction is 33% of total PPC spending. Another 10% of advertisers have plans to cut their PPC spending budgets. On average, advertisers estimate that 14.6% of the clicks they’re billed for are fraudulent, representing about $800 mln in spending for fraudulent clicks in 2005. The total impact to advertisers is $1.3 bln (the $800 mln wasted on fraudulent clicks plus $500 mln no longer spent on PPC).