Where do I get my 25% refund from AdWords? This is a significant sum to me.
OTOH, doesn't this require perfect efficiency and for all bidders to know perfectly their ROI, etc.? Any holes, unintentionally irrational behavior, etc. and the fraud "leaks" into the price, right?
So, for instance, any "unprofitable" advertising on behalf of any participants would seem to automatically cause the fraud to be reflected in the price.
Based on personal experience, I would guess that there's a pretty long tail of advertisers who never realize an ROI while spending a considerable sum seeking it!
Even those that eventually profit likely spend a good bit of money ramping up, all the while paying for fraud in the process and helping to support a fraud-inflated CPC overall.
Most AdWords advertisers would probably be surprised to see that they're only being charged for 75% or less of the clicks on their ads already. They simply never show up in the performance reports or on the bill.
To see them, log in to AdWords, click on a campaign, click the "Dimensions" tab, choose the "View: Day" filter, click "Customize Columns", choose the "Performance" category, and add the "Invalid Clicks" column to the report.
Now you'll see the huge number of clicks Google received on your ads but never charged you for.
It's also common to see adjustment entries on the billing report labeled "click quality". Those are automatic refunds for potentially fraudulent clicks given after-the-fact when they couldn't be caught in real-time.
Not saying anything shady is happening, just that they've made big changes and aren't communicating properly about them.