THK- Starts to Think, Shares no longer Sink

C'mon Wayne. What is this, a PayPerPost gig?

Oh, just kidding… just kidding.

I don't think ValidClick is a solution. It's a network that suggests it's using fraud-proof technology right?

From their site: The ValidClick Search Network has over 1,000 websites and 60 million monthly click fraud protected searches. Learn more about paid search advertising opportunities on our 100% click fraud free search network verified by FeedPatrol, our real-time click fraud prevention technology.

Please… I'd like for you and others to kindly explain to me how click fraud isn't an assumed cost of doing business. There simply isn't the demand for ValidClick to succeed.

In fact, advertisers are very happy with the click fraud. How can I make such an outlandish statement? They let Lane Gifts & Collectibles settle on their behalf with Google in an obscene "settlement" that does nothing for advertisers and further protects Google.

They're, again, letting Yahoo off the hook by allowing Checkmate Strategic Group Inc. v. Yahoo to go unchallenged (although Ben Edelman is putting up a fight, as you well know! http://www.yahoosyndicationfraud.com).

Will the real Wayne Porter please step forward?

Where is Steve Shubitz on this one? Steve, let's take Wayne out back in the alley.

You got Jeff to respond, so I'm betting this is a pay per escalation type post.

+5 to me.

a) The crux of the post, Jeff, is that THK, as a stock is on a strong rebound. I see this as significant. I also see them as as possible acquisition target.

b) Don't categorize one or two merchants with what is "on the merchant's mind".

I don't care as much as what they have- as to how their CEO is thinking. Everyone, but Google, talks about ClickFraud. We can discuss this on Friday in a battle royale and the winner…well get's something.

No need for a battle royale and why would you think that my comments reflect that of one or two advertisers?

Quite the contrary they reflect the state of our market and I’m surprised to hear you making such silly, presumptuous assumptions considering all of our conversations lately — public and private.

That stated, I’m clear on the fact that your position remains — click fraud is a huge concern for a significant number of advertisers. What I’m not clear on is why we’re not seeing anyone actually discuss this. In fact we see you hanging out with people pointing out that nowhere in Google’s recent earnings call do you hear click fraud even discussed. I’m reading and listening to all kinds of your views on click fraud and they don’t seem to match your thoughts here.

I’ve passed your entry around to a few trusted colleagues all of whom are scratching heads. You increase the rate of scratching by continuing to deny us access to any of your reasoning that support your statements. Is this asking too much from you… to ask that you take your significant statements about THK and back them up (even a little bit)?

In fact, actually now continue to fluff THK… providing more ammo for me to ask you WHY. In full disclosure do you own any THK stock?

What is the question Jeff?

What is so puzzling?

I am saying THK stock, after their new CEO took over is in an uptick. They stopped buying everything and seem to be putting stuff together.

I know better than most about click fraud. I study it and understand the complex mechanics behind it. Actually dig back in my blogs (about three years worth) and you see me talking about it- predicting it growing into an industry of its own. I can dig it up if you like.

My point is that merchant’s are in tune with clickfraud, I think investors are too- the goliaths ignore talking about, as Sam pointed out in his post- the analysts on the call didn’t ASK about it- WTF?. You echo that- you know that- people are talking about it- just not the right people.

THK does NOT ignore it and thus I note that. They’re going after it…

I said: “Eitherway I think his thinking is dead on the money, despite what Google doesn’t say in their Q3….

Mitchell is in sync with merchant’s minds: “Click fraud is now the hottest topic in interactive marketing, with articles in BusinessWeek, The Washington Post, and all the major ad industry publications…”. Not to mention what malware fighters see in the field day-in and day-out.”

I’ll break it out to make it more clear.

I go on to postulate that **perhaps** this new leadership, lack of acquisitions and focus on core business and needed products (like click fraud tools) are why we are seeing a limp stock slowly climb near the previous high.

I don’t know for sure thus i say- perhaps- I am not a stock analyst. To me it is just good business sense- market is concerned- build a tool to meet demand. Prior to Mitchell they bought and bought but with no clear sense of putting it together- at ad-Tech their poster product is ClickFraud solution- makes sense.

Everyone is talking about it- except for those who benefit from it the most. eh? Any clearer? To say equate this with a PPP is ridiculous.

If you are referring to why i think they are an acquisition target then I can go further into that- THK, even players like ShareaSale are all targets for bigger players who perhaps realize that their are thousands and thousands of smaller businesses and those are the ones who benefit from performance marketing the MOST. If you are a big network- where do you grow next? Who do you buy next?

If it were me I would buy- key technology, new technology that extends what they do, businesses that serve niches or segments they have turned away- think kowabunga customers, and innovation be it intellectual DNA or technology or both.

*Full disclosure- Yes I own stock in about every major e-commerce player out there either via mutual funds or direct. Stock in THK is a *trivial* amount. Should i annote that I hold 3 and a fractional shares of Google everytime I post about them or that I own 1 share of many companies so i can attend board meetings? Or that i hold mutual funds that might hold these equities? You tell me what are good guidelines and your policy.

Ahhhhhhh I see it now…ValidClick…Litmus Media…I did confuse it as click fraud fighting tool and I have spoken to John, ex-ceo of Litmus. I am very aware it- why debut it now?

So yes- I made a mistake here and will investigate/correct….

Still a 1000 sites or so? That is managable. If they said 100,000 or 1,000,000…well one way to find out…ill go dig for myself and see what turns up.

http://www.costpernews.com/?p=17

some more on validclick.

More food for thought.

http://blog.searchenginewatch.com/blog/061031-090445

For anyone out there who doesn't think that click fraud is a rapidly growing concern among marketers (Molander!) here's some data:
http://www.emarketer.com/Article.aspx?1004245
Nearly 40% of large marketers consider it a problem, and the numbers skew based on spend. Sounds like demand to me.

We've done a tremendous amount of research on click fraud and know this space very well. To us, it seems like click fraud is a bigger issue for publishers than it is for advertisers as it significantly erodes the ability for clean publishers to monetize their traffic as dodgy publishers benefit. Advertisers do lose a lot because they could get a similar or slightly higher return on their investment but much higher volumes if click fraud didn't exist but they don't realize it because they are very ROI focused and will only spend the amount that maximizes their ROI. In the end, the industry loses the most and grows at a much slower pace because of it.

The picture is very clear to us and it is simple market economics. Well thought out and documented through academic economics. It simply creates a market inefficiency and fraudulent arbitrage.

ValidClick has a very compelling patent pending solution that we like very much and Mitchell's approach to building up a click fraud protected network, in our eyes, is brilliant. Publishers benefit and advertisers will advertise more as they get the same ROI from large volumes.

This is the kind of approach that not only takes a little market share away from competitors (a little bit bigger piece of the pie) but also significantly grows the pie.

This is just our well researched opinion. I m slightly out of place in posting on a forum like this, but I am shocked at what seemingly well informed individuals position is on this topic. Everyone has the right to their own opinion, but it is simple economics. Seems to me arguing against this is like arguing against evolution and I think the appropriate question to be asking is how much Google stock is owned by Jeff and not how much Think Partnership stock is owned by Wayne (full disclosure – I don't know either of them).