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Spook Alert: Prevent Fraudsters From Draining Your Ad Budgets

We summarise the latest findings on ad fraud, as we dig deep into an issue that continues to keep many marketers up at night.

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To make digital campaigns successful, marketers need to ensure their ad spend is being used to reach real people. Whether we like it or not, it’s a fact that ad fraud does exist in the digital ecosystem, and not all campaigns are being seen by humans.

Digital ad fraud is any deliberate activity that prevents the proper delivery of ads to the intended audience, or in the intended place. Most commonly taking the form of bots, or domain spoofing, ad fraud thrives by siphoning off money from advertising transactions. It can come in many forms: pretending to be humans browsing the internet or falsely representing low-quality inventory as high quality.

So, where are we at right now with ad fraud? Why has it not been resolved? And, what action can we all take to help stop it? Below, we summarise the latest findings on ad fraud, as we dig deep into an issue that continues to keep many marketers up at night.

So, where are we at with ad fraud right now?

According to the latest Magna Advertising Forecast in 2021, Asia Pacific’s ad economy is expected to rebound by 8.1% to reach US$175 billion. Considering brands in the APAC will be spending US$52 billion in digital representing 69% of total spends in 2020, understandably they want to know their significant investment in digital is not going to waste.

According to the recent IAS media quality report, in H1 2020 non-optimised fraud on desktop display hovered at 13% and optimised was 0.8% clearly making a case for using ad fraud mitigation strategies. Unsurprisingly, campaigns that do not utilise any ad fraud mitigation strategy attract the most fraud globally.

Ad fraud is a problem that shows little sign of disappearing any time soon, but there are ways you can help the industry to beat the bots.

What constitutes ad fraud?

Bots and falsely represented sites (i.e. domain spoofing) are the most known forms of ad fraud, according to the IAS Industry Pulse research. Bots – software programmed to intentionally view ads, watch videos, click on ads, and will be used as a tactic to siphon off money from advertising transactions

Domain Spoofing – where fraudsters fool buyers into thinking their ad is going to a premium site, when in reality it’s going to a low-quality website

Ad fraud is also often referred to as invalid traffic (IVT), a broad term describing online activity that does not always come from a real user. The industry has categorized invalid traffic in two ways:

General Invalid Traffic (GIVT) – invalid traffic can be identified through routine means of filtration, executed by using lists or other standardised checks

Sophisticated Invalid Traffic (SIVT) – invalid traffic is more difficult to detect, requiring advanced analytics, multi-point corroboration, and/or significant human intervention in order to identify.

What’s in it for the fraudsters?

Well, they make Millions! Ad fraud is a readily available and straight-forward operation for those with the right skills and knowledge. To carry out criminal activity across the web, all a fraudster needs is a few computers and the technical know-how. Within the realm of criminal activity, ad fraud has incredibly high payout potential at a low risk to the fraudster, as it is difficult to penalise by law. Most ad fraud is committed in countries with indifferent or ineffective cybercrime law enforcement. The process of delivering a fraudulent impression involves multiple parties at different stages — starting from a publisher, then a network or exchange, then a traffic broker and/or malware distributor. The process is so interconnected that it is nearly impossible to determine who is at fault.

How to protect against Ad Fraud?

In the digital space, ad fraud has not been monitored or regulated – meaning that the digital space is one where fraud gets rewarded easier as there is a lower barrier of penetration and lower chance of getting caught.

Beyond understanding the potential threat that ad fraud has as well as the limitations we have, the industry also needs to understand that there are many ways to combat ad fraud and it takes the entire ecosystem to do so.

Both the supply side and the demand side needs to take up the responsibility to create awareness. Publishers need to ensure that the inventory that they supply conforms to industry standards. On the other hand, advertisers need to take into consideration the bigger picture, and demand for better quality inventory.

If you’re an advertiser or publisher and regardless of the buy type- publisher direct, or programmatic you can optimise away from ad fraud. Advertisers should work with the verification partner that takes a three-pronged approach to detection — behavioural and network analysis, browser and device analysis, and malware analysis with targeted reconnaissance, across devices, environments, and creative formats. To learn more about how to mitigate ad fraud click here.

Being proactive and well-informed can go a long way toward ensuring that you and your advertisers present a unified front against fraud.

Optimised-against-fraud campaigns are 10 times less likely to be exposed to fraud than those lacking protection. The argument to put ad fraud prevention technology in place is quite simply, undeniable. No tricks or treats this Halloween!

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Written By

Laura Quigley is the Managing Director, APAC at Integral Ad Science. Based in Singapore, she builds strong partnerships with clients, agencies, and publishers and helps them solve their pressing business challenges with the use of cutting edge IAS technology solutions. Follow her on LinkedIn.

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