Countering the industry-wide challenge of digital ad frauds

Ad frauds create negative connotations about digital advertising solutions

Digital advertising has brought with it an array of unique benefits like precise targeting, measurable and trackable performance indicators, and the ability to provide extremely personalised customer experiences. Advertisers can now practically do things that they could only dream of earlier. However, it has also brought with it the menace of ad frauds. Advertisers are struggling with ad frauds since quite some time. All ad frauds can be loosely defined as any deceitful online activity meant to mislead the advertisers, making them pay for low-quality or fake traffic. Ad frauds wipe out huge chunks of advertising budgets, causing huge losses to the companies. This has created negative connotations about digital advertising solutions in the minds of businesses.

A few years ago, the advertising industry witnessed two of the greatest ad frauds ever - Hyphbot and Methbot. They decimated gigantic volumes of ad dollars. Methbot churned out revenue of $3 to $5 million each day by targeting premium video advertising ecosystem. Hyphbot was 3-4 times the extent of Methbot and generated up to 1.5 billion ad requests each day. These figures speak for themselves about the urgency to address these problems.

It is about time to fix this. But, unfortunately, it is easier said than done. As technology evolves, the nature and sophistication of ad frauds evolve with it. It is a game of whack-a-mole, between the industry and the fraudsters, wherein as soon as one problem is addressed, they continuously come up with new and different ways to continue the menace. In order to solve the problem, we first need to understand it well by getting into its nitty-gritty. So let’s take stock of the situation and have a look at the different types of ad frauds advertisers are facing.

Bot Traffic/Non-Human Traffic (NHT)
Ad consumption or other online traffic generated by bots or automated websites

Click Farms
These consist of a large group of human workers who view or click on the ads on behalf of a third-party, who gain economic benefits from those illegitimate clicks. To do this, these workers are given minimal compensation.

Sourced Traffic
It is a way by which publishers acquire more visitors to their sites through third-parties. It is basically artificially generated inorganic traffic.

Domain Spoofing
It facilitates passing off a low-quality website as a premium website. Thus, when a user clicks the link, the fraudsters get access to the ads, which are run on the illegitimate site.

Ad Injection
It is the practice of inserting ads into any online inventory like a website or an app without the knowledge and consent of the publisher or the owner of that property.

The ones mentioned above are only a few ways in which ad frauds are perpetrated. The field of digital advertising is highly dynamic. With the addition of new technologies each day it keeps evolving continuously. Fraudsters are constantly coming up with ingenious ways to adapt to these advancements and fulfill their objectives. As a result, brands have to be constantly alert and have to match the pace of technology, in order to be a step ahead of the curve. However, unsurprisingly, it becomes difficult for them to be constantly updated about everything.

One of the ways to address this problem is to ensure that advertisers partner with the right kind of programmatic platform. A platform which provides a good level of security on-boarding fraud detection and fraud prevention partners, that helps to filter out fraudulent ads and illegitimate traffic in real-time. The platform must also follow the standards set by industry watchdogs like The Internet and Mobile Association of India (IAMAI), Trustworthy Accountability Group (TAG), The Interactive Advertising Bureau (IAB), etc.

Next, brands must make sure that they measure the conversions and goals instead of measuring clicks.  Measuring clicks as an indicator of performance makes the brand more susceptible to bots and NHT. Also, they must work with publishers who have implemented ads.txt – IAB’s protocol designed to help keep ad frauds in check. It involves publishers hosting a text file on their web servers. This file lists all the authorised dealers of the publisher’s inventory. Also, publishers should be transparent with advertisers about the source of their traffic.

Ad frauds are a problem not only for advertisers but they also harm publishers. Ad frauds devour a huge chunk of their revenues and also raise a question in the publishers’ credibility. Thus, ad frauds are affecting the entire ecosystem at large. Industry-wide standards are necessary to control this industry-wide challenge. It calls for all the entities across all parts of the advertising ecosystem to launch concerted efforts in fighting-off ad frauds.

(The author is CEO and Founder, Vertoz. The views expressed here are his own and may not subscribe to them)  

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