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Digital Ad Fraud: is the Industry Stuck in a Never-ending Game of Whack-A-Mole?

  26 November, 2014

Niall HoganWhile bot fraud has been an industry problem for some time now, 2014 was the year when all parts of the industry finally  broke the omerta-style silence and started to speak openly about the issue. Here Niall Hogan, UK Managing Director at Integral Ad Science, asks whether the industry can ever eradicate the issue, or if we’re stuck in a never-ending game of cat and mouse with the fraudsters.

The media love a headline, and this summer’s big shocker “60 Percent of Mercedes Ads Served to Bots” which appeared in the sober Financial Times, was swiftly followed by further headlines of wasted advertising revenue. Each week, with ever-larger figures bandied around, the industry seems hell-bent on giving marketers more misgivings about digital media.

The reality is that the online advertising industry — in striving to innovate and embrace technology — has also created opportunities for fraudsters. But is the industry simply playing a game of Whack-A-Mole: where you solve one problem only for another to appear? Before answering that question, we have to look at both the technological and cultural forces that are currently shaping our industry.

Two main areas of concern are CPM and bot fraud. CPM fraud involves publishers knowingly trying to defraud advertisers by serving ads where there is no chance for them to be seen, let alone engage a viewer. Techniques include pixel stuffing and layering impressions on top of each other. Video is another area where fraudsters will again stuff videos into impossible to view 1 x 1 iframes, or loop videos continuously without being shown to users.

Bot fraud, or non-human behaviour is where a computer (or more usually tens of thousands of computers) have been taken over by a bot which instructs the machines to serve ads behind the scenes, and unbeknownst to the user. The scale of this is mind-boggling as millions of ad impressions are generated on a daily basis with absolutely no chance of being seen by a human.

This means that advertisers are paying for impressions that appear to be served. So yes, a worrying amount of advertising revenue being wasted, but it’s an inevitable feature of an increasingly programmatic industry. Put simply, by removing the human element from direct trading, you inevitably give the fraudsters more opportunities to operate.

But will the industry always be this way, or can we beat fraud for good?  Because the frausters are constantly evolving, there’s no simple answer to that question, but there are steps we can take to minimise the impact of fraud in the interim. Firstly, we need to see more collective action. If the industry fails to work together to beat fraud, we risk losing the trust of marketers just as the medium is getting exciting with possibilities and being embraced by brands.

Secondly, we need to be realistic about the scale of the problem and minimise the scaremongering as some of the figures about advertising waste and fraud have been greatly exaggerated. We see around 30 billion impressions monthly on a global basis, and this robust data shows us that this is not a 60 percent fraud problem. Our quarterly report released this month shows that 15 percent of video is fraudulent, while 13 percent of digital is fraudulent.

Thirdly, the scale of the industry means that manual processors can’t find and stop fraudsters. Even putting our company’s self-interest aside, the reality is that all we can do is to leverage tools to help brands identify and rid your exchange, network or campaign of fraud.

Finally, with such a lucrative revenue stream, fraudsters are constantly evolving ways to try and stay one step ahead of being caught or shut down. We need to move away from correlation-based last touch models that actively incentivise fraud. The good news is that we are constantly developing ever more sophisticated ways to identify their methods and remove them or block ads being served to them. The technology is there — it’s time to start using it.

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