A watershed moment exists in the digital marketing sphere that could mold the future of the industry for years to come.
Between ad fraud, clickbait journalism, and the proliferation of fake news, internet users are responding en masse to these deceitful advertising practices with ad-blockers.
Maybe you think that ad fraud hasn’t affected you directly or, if it has, it’s only been a tiny fraction of your ad spend. But the issue affects us all. Per Google:
“The digital advertising ecosystem is built on trust, working at its best when all participants are good, and when no one tries to deceive anyone else. That’s why ad fraud is potentially damaging – it can erode trust.”
In the end, everyone is a victim of ad fraud, especially the publishers and advertisers. If there is a silver lining to all of this fake news and ad fraud madness, it’s this: people are finally paying attention.
This has led to more sophisticated technology entering the market to stop fraudulent ads that don’t exist inside a black box. That’s why many experts believe that ad fraud should actually decrease in 2018, rather than increase.
But as advertisers and supply-side providers become more sophisticated, so too do the fraudsters. That’s why I’d like to go a little more in-depth about this topic and outline some steps you can take to combat ad fraud before it occurs.
How Serious Is Ad Fraud?
When Google began taking steps to combat ad fraud in 2015, its blacklist filter removed “8.9 percent of clicks on the DoubleClick Campaign Manager alone.”
Of course, the problem has only swelled since then. Recent reports suggest that programmatic ad buys may include as much as 37 percent click fraud.
According to Juniper Research, advertisers lose $51 million a day on ad fraud, which may add up to well over $19 billion in wasted ad spend by the end of 2018.
The problem is not going away anytime soon and the fraudsters are becoming more sophisticated. BuzzFeed found that YouTube and LinkedIn were being used to create pop-under ads and redirect traffic to make its traffic numbers appear legitimate. How far this issue spread was impossible to verify.
Ad fraud has already impacted major advertisers, as brands like Unilever, News UK, and Financial Times have taken steps to reduce their budget and monitor ad fraud.
Proctor and Gamble reportedly slashed its advertising budget by $750 million last year and stopped working with half of its agencies due to ad fraud.
The biggest targets of ad fraud this year will be video ads for over-the-top streaming media services. Currently, a large portion of ad fraud occurs over programmatic marketplaces, especially in display advertising. But ad fraud exists on all platforms, whether we are aware of it or not.
Here’s an example of an Instagram ad I created on April 11, 2018 to promote a talent booking app I helped create called Special Guest App:
You be the judge if there was click fraud. The ad was targeted to a demo of 785,000 people in Northeastern Pennsylvania over 24 hours with an ad budget of $100 across Instagram and Facebook. The ad received 1,246 “likes” and 1 unrelated comment as you can see above.
One industry that remains particularly vulnerable to fraud is app store marketing. Unlike Google and Facebook, app stores offer far-from-sophisticated audience features.
Yet, all of these platforms run a significant risk for mobile attribution fraud as it relates to apps. Since most apps are bid on using CPI (cost-per-install), it’s become easy for fraudsters to manipulate these propositions.
Ad fraud hurts everyone and erodes trust across the entire ecosystem.
For advertisers, it’s ad blockers. For publishers, it’s lowered retention rates from poor performing media.
The platforms themselves also suffer, as users who receive a poor experience flock to alternative platforms that deliver a better experience.
Types of Ad Fraud
Before we proceed, it’s important to delineate exactly what ad fraud is.
While most people chalk it up to bot traffic, there is a considerable portion of ad fraud committed by ad agencies and publishers.
The most common forms of ad fraud include:
- Bot traffic clicks and impressions.
- Ads on platforms that are not seen by real users.
- Ad agencies or publishers who purchase traffic or use deliberate platforms to misrepresent data and performance.
Ad fraud committed by real people is actually the hardest to detect.
While the clicks and impressions may be false, the actual users behind them are real. Most ad verification software won’t blacklist real end-users.
Here are some common examples of human propagated ad fraud:
- Click farms: Clickbait ads with real form fills that don’t actually result in anything.
- Impression stacking: Ads that are literally tucked beneath other ads and used to fake impressions.
- Injected ads: Ads that replace other ads on a platform and aren’t registered in their inventory.
- Arbitrage: Publishers who sell traffic to other agencies.
Other examples include cookie stuffing, site bundling, and domain spoofing.
The problem here is that ad fraud is technically not illegal. Being an open marketplace, you are pretty much responsible for your own ads.
But should we should all sit back and do nothing? Even if fraudsters don’t target your ads directly, doesn’t it partially devalue them indirectly?
According to a survey by QueryClick, 85 percent of marketers reported that they wished international trade bodies had more power to punish fraudsters.
Many advertisers – as well as private publishers and ad platforms – are taking matters into their own hands. Rather than becoming victim to the bystander effect, it’s time for advertisers to take action.
Here are six ways advertisers can fight ad fraud.
6 Steps to Combat Ad Fraud
1. Employ Ad Verification Tools
If you decide to use a private programmatic network then it’s absolutely critical to employ third-party audit providers. Oftentimes, advertisers will even use multiple third-party verifiers to audit private platforms.
Third-party providers provide ad agencies with their own analytics research and KPI performance that shows real, not faked, results. They can also filter out fraudulent ads in real time before they drive up your ad spend.
Some agencies to look into are Integral Ad Sciences, WhiteOps, and Pixalate.
2. Measure Conversions, Not Clicks
Consider switching your bidding proposition to more actionable metrics, such as conversions or lead forms.
This should be practiced if you’re advertising over an open-marketplace, but should also be considered for platforms like Facebook and Instagram as well.
This is not to say that you should be overly paranoid, but click-based goals are very easy to trick with bot traffic.
3. Use Trusted Platforms
On the same note, I’m sure most of us already focus primarily on traditional advertising networks, like Facebook and AdWords.
While there is a case for programmatic networks, it should only be used at your own caution. Unfortunately, until Google and Facebook can fix their own issues, it’s important to take more proactive steps to track and block ad fraud before it occurs.
4. Don’t Rely on a Machine
This places the argument for taking more control over your campaigns and implementing your own internal policies for manual review.
If you are working with other partner networks, it’s key to demand transparency on their policies and processes to ensure that they share the same values as it relates to ad fraud.
Unfortunately, this is not enough, and it’s important to manually review your own KPIs and performance. Use third-party ad trackers to compare actual data with reported platform data. Most offer their own metrics to track fraud, such as AD Science’s Invalid Traffic data.
By implementing a series of internal policies and reviews in place, you can create a repeatable process that ensures your ad data is not subject to fraud.
5. Leverage Big Data Analytics
You can take this one step further by comparing invalid traffic data with other campaign analytics to better understand how fraud is being propagated.
Using large data sets, you can understand what networks are receiving the greatest volume of traffic fraud, which ad campaigns, and what policies are reducing the greatest number of invalid traffic/clicks.
Equipped with this data, you can implement stronger ad fraud practices that strengthen your own core campaigns and drive better results for clients.
6. Use Ads.txt
Finally, individual publishers need to adopt the IAB’s ads.txt protocol to help avoid domain spoofing and resulting ad inventory from ending up on third-party sites.
Google strongly recommends adopting the initiative, although it’s not mandatory. Unfortunately, the initiative only goes so far as 19 percent of publishers remain unaware of what it is. This means it’s still up to advertisers to protect themselves.
Ultimately, advertisers and internet users are the greatest victims of the ad fraud scourge. While new technology has helped to combat ad fraud, it ultimately comes down to advertisers to protect their interests.
Without wide-scale awareness of the issue, every advertiser will suffer as the trust between brands and internet users further erodes.
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Screenshot taken by author, April 2018