Uniting Against Ad Fraud in 2018
CAPTCHA tech asks us to prove we're not robots all the time, but they can't catch everything.
2017 saw a major rise in ad fraud, as new tools arrived to fake the presence of a human viewer. Advertisers are now losing millions of dollars a year to ad fraud, shelling out for views that aren’t actually happening. However, there is a growing unity amongst vendors, trade groups, and agencies to combat this problem as we advance further into the new year. Presenting a unified front to the problem of ad fraud is not just about sportsmanship-- combining efforts will mean saving hundreds of thousands of dollars that might otherwise be lost to cybercrime.
There are several ways to make it seem as though an ad has more real traffic than it actually does. The most notable recent antagonists are a network of around 40 "zombie sites," a "Sports Bot" operation and a "Hyphbot”, all of which were discovered by industry watchdogs and ad tech firms, but only after months of uninterrupted defrauding. Thanks to the concerns raised by the discovery, technological solutions are beginning to arise from a collaboration between agencies. Working towards a mutual goal of defense heralds benefits for all involved.
"There is a variety of organizations that recognize that there are business opportunities here: it's not all for altruism, it's an opportunity," said Bob Liodice, chief executive at the Association of National Advertisers (ANA). "You don't have to be a rocket scientist to know that if I can save you $1 million by investing $25,000 [fighting fraud], it's a win-win for everybody. I think that's where the marketplace is galvanizing around."
Developing Defensive Tools
According to the World Federation of Advertisers, the global cost of ad fraud over the next ten years is projected to rise to $50 billion.
Spread out over ad agencies, however, the individual losses have been brushed off in the past as “rounding errors”. Even when the numbers were addressed as criminal activity, brands in the past have chosen to assign blame and demand recompense. As collaboration increases, however, marketers are beginning to take a more proactive approach instead of a reactionary one.
"The good news is that the ad tech industry is finally moving towards fraud prevention rather than simply fraud detection," said Piyush Shah, chief product officer at InMobi.
Enter systems such as Ads.txt, introduced by the IAB Tech Lab in May of last year. Ads.txt prevents the sale of counterfeit inventory, allowing buyers to be certain that inventory is coming from an authorized publisher. It creates an index that verifies both sellers and buyers of ad space, making it harder for malevolent domain spoofers to masquerade as genuine publishers.
A joint study between 16 programmatic publishers including The New York Times, The Washington Post and Business Insider and done in conjunction with the DSP platforms Google, Amobee and Quantcast released last week estimated publishers lose $3.5 million to fraud daily, or $1.27 billion yearly, based on a $5 video ad CPM valuation. Google, Business Insider, Amobee, and other participants in the study advocate strongly for ads.txt, which has a lot of potential to save brand campaigns from taking this type of loss on the purchase of fake inventory. For now, however, ads.txt must continue to gain popularity amongst ad companies to see really full effects.. "Until ads.txt is adopted across the industry, domain spoofing will continue to divert advertiser spend away from legitimate publishers," said Pooja Kapoor, head of global strategy, programmatic and ecosystem health at Google.
Addressing The Weak Points
Ads.txt isn’t the only tool available for ad companies seeking to prevent fraudulent use of their content.
The Trustworthy Accountability Group, or TAG, was created by the American Association of Advertising Agencies (4A’s), Association of National Advertisers (ANA), and Interactive Advertising Bureau (IAB). The program self-regulates, helping to mitigate the amount of fraud in the system and create greater industry transparency. Being TAG certified means agreeing to self-auditing, results sharing, and even answering to a compliance officer. Amongst trade groups and agencies, TAG and ads.txt are becoming the heavyweight champions of ad fraud prevention. However, president and CEO of TAG Mark Zaneis is also of the belief that widening the use of such programs across digital advertising is paramount. "Just because [a successful program] exists doesn't mean marketers will always avail themselves of it," he told reporters on a conference call. "It certainly doesn't mean we've solved the fraud problem.”
In addition to committing to careful implementation of the existing tools, digital advertisers are also advised to remember that defrauders aren’t always shadowy, far-off figures. When Buzzfeed, Social Puncher, and Pixelate conducted studies into digital ad fraud in October of 2017, they discovered a network of zombie sites. The CEO of an ad platform and digital marketing agency is an owner of 12 of the websites that earned revenue from the fraudulent views, and his company provided the ad platform used by sites in the scheme. A former employee of a large ad network ran a group of eight sites that were part of the fraud, and consulted for a company with another eight sites in it. Finally, the cofounder of one of the 20 largest ad networks in the United States was a major player in the operation. All sites involved in the scheme used ad technology provided by 301network, which is a company connected to 301 Digital Media, a marketing agency based in Nashville. This only goes to show how seemingly-credible players in the supply chain can disrupt legitimate ad channels and defraud their industry peers.
Digital advertisers must also be wary of the new challenges presented by the growing prevalence of mobile advertising. Mobile ads are forecast by ZenithOptimedia to account for half of all internet advertising by 2018, making the platform increasingly susceptible to fraudulent technology.
For advertising companies, last year felt like a constant battle to adapt to both evolving consumption tastes by their demographics and cross-industry issues of brand safety, regulations, transparency, and malevolent technology.
Once considered simply part of the cost of digital advertising, fraud is now a force that requires reckoning with. It will likely take a full systematic change within the industry to plug the leak. Unfortunately, we still can’t count on brands to communicate the way they need to.
“The main problem about ad fraud is that brands, which lose shareholders’ money, do not want to speak about it," said Vlad Shevtsov, the director of investigations for Social Puncher. "Even in obvious cases like this one.”
The other reality is that some brands simply don’t have the resources for a large-scale adjustment to their programmatic trading system.
But efforts are being made to push through the necessary overhauls. Last month the IAB announced that it was requiring member companies to register with TAG by June, a move that will hopefully make the supply chain safer.
The ANA has declared the war on ad fraud “winnable”-- but the victory will rely upon both regulatory bodies and voluntary brand participation.
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