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Fairwinds Reduces Assumption of CPC on TypoSquatting Sites, But Still $2.03

July 26, 2010Domaining, Domainnamewire, fairwinds partners, Policy & LawComments Off on Fairwinds Reduces Assumption of CPC on TypoSquatting Sites, But Still $2.03

Fairwinds updates faulty report, but it’s still laughable.

Last month FairWinds Partners, the group behind CADNA, released a report suggesting that typosquatting costs the 250 most visited web sites $327 million a year. I immediately smelled something fishy about the biggest underlying assumption in the report: the average cost-per-click on ads on typosquatted domains was pegged at a lofty $2.74 per click.

The report referenced a VeriSign report for its CPC value. There was one problem, though: the VeriSign report didn’t mention anything about a $2.74 CPC value. (Representatives of FairWinds did not respond to my initial inquiry about the VeriSign reference.)

Today FairWinds updated its report with a new value of $2.03 a click. It’s still a joke.

Here are some recent average CPC prices for top verticals in search:

Automotive: 51 cents
Retail: 50 cents
Finance: $1.99
Travel: 60 cents

Keep in mind that the top typosquatted sites, according to FairWinds, include MySpace, YouTube, Facebook, and Google. Anyone at all versed in domain parking knows that traffic intended for these sites converts for pennies at best.

I talked to a major PPC advertising firm after reviewing FairWinds Partners’ initial report, and they said the price assumption was absolutely ridiculous.

So how did FairWinds come up with its new $2.03 CPC? It plugged in the term of each domain into the Google Adwords Traffic Estimator. It’s a convenient approach for FairWinds given the junk Google spews back.

For example, type in “You Tube” and Google estimates an average $1.59 CPC. Now go to Google and type in “You Tube” and you’ll only see YouTube’s official ad running. In reality, a typo of YouTube would show ads for lessor terms and pay out pennies, if that.

The Google estimator also shows only prices for the top positions and doesn’t take into consideration smart pricing and content network pricing.

Does typosquatting cost companies? Sure. But suggesting that each click on a typo of these domains is equal to $2.03 in advertising costs is ridiculous.


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Related posts:

  1. Fairwinds Says Typosquatting Costs $327 million, Based on $2.74 Per Click
  2. Report: Google May Earn $497 Million a Year from Typosquatting
  3. Google Lets Advertisers Opt Out of Domain Parking Sites