Ad fraud: The one disease that digital marketers need to avoid

Our guest author writes about ad fraud, what exactly it is, the types of ad fraud and how marketers can prevent it.

Just like the ongoing Coronavirus pandemic, the one serious malaise that’s been affecting the world of digital marketing in an unending manner is ad frauds. It’s an ailment that’s been all-pervasive, affecting businesses of all kinds - visibly or invisibly, severely pernicious in its impact, yet almost devoid of a permanent and definitive cure till now.

What exactly is ad fraud?

Simply put, digital ad fraud is any intentional act that prevents the delivery of digital advertising to its intended audiences. Ad fraud practitioners (or digital thieves) brazenly siphon off money by using ingenious means to misdirect, or misdeliver, advertising.

It’s a malafide practice purposefully designed to ensure that by mimicking human behaviour of browsing, or by using sophisticated technology like bots, these fraudsters keep misappropriating revenue that rightfully belongs to someone else.

However, owing to the ever-evolving and impersonal nature of the digital medium, the malpractice has gone on practically unpoliced for a fairly long period now. Compounding the problem is the fact that digital advertising remains a complex process, based often on an opaque supply chain, with an over-dependence on metrics. This effectively turns ad fraud into one of the biggest challenges facing advertisers, publishers and ad-tech enterprises alike.

What is the extent of the damage?

TrafficGuard/Juniper sets the ad fraud loss figure at $34 billion, growing to $87 billion by 2022.

Not surprisingly, about 60 per cent of it is in APAC region.

India seems to be a major losing party too, giving away about 12-15 per cent of its digital ad spends to fraud. Very conservatively, going by last year’s adex figures, that in Indian currency would be equivalent of approximately Rs 1,200 crore - minimum.

Precious revenue that ‘virtually vanished’ through a befuddling maze of screens, wires and technology.

Types of digital ad fraud

The landscape of fraud is forever changing and impacts practically all players in the ecosystem. IAS (Integral Ad Science) assesses fraud to be ubiquitous, constituting 0.4-11.7 per cent of all digital traffic. Adobe says that 28 per cent of web traffic today comes from non-human actors. According to Interceptd, 27 per cent of Android app installs are fraudulent… and so on.

Closer home, the latest MMA India report says 62 per cent of all digital ad frauds are taking place on mobile advertising, which is now the dominant mode for digital advertising. And within that, digital video is being targeted increasingly.

Fraud today can assume myriad forms:

• Traffic sourcing: Here, bots appear as human traffic and fraudsters sell bulk impressions to publishers at low costs.

• Ad stacking: This technique involves placing multiple ads on top of one another, to create several fake impressions on a single page view.

• Pixel stuffing: The fraudster forcefully stuffs an ad into a single or a few pixels on the screen, making it unreadable to humans, yet being counted as an ad.

· Cookie stuffing: Fraudsters circumvent attribution models by adding a cookie to a user from an entirely unrelated site that she never visited, effectively getting paid for non-users’ action.

• Ad injection: Here the impostor ad usually covers or at times even replaces the original ad that the publisher displayed.

· Location fraud: Fraudsters will send false location information, while the ad actually serves elsewhere.

• Fake app installs: This scam is carried out either by fake mobile devices installing apps and getting credit, or by thousands of real phones being commanded to download apps and get install fees.

• SDK (Software Development Kit) spoofing: This involves bots in apps that send fake clicks/installs to the respective MMP (mobile measurement partner) which counts them as genuine.

• Domain spoofing: When fraudsters make buyers think that their ad is going to a premium site, when instead it’s loaded on a low-quality website.

Interestingly, driven by strong growth of digital video, there is also emergence of curiously-named volunteer botnets. Here, users knowingly allow their computers to be infected by bots that will automatically browse content, in order to get reciprocal traffic to their own content.

Here are five top tips for marketers to prevent fraud:

1. Choose trusted agencies and tech-oriented partners: Ask how they measure for malicious bots and other forms of invalid traffic (IVT).

2. Implement advanced ad verification and fraud solutions, like Moat, Nielsen, DoubleClick, that can confirm ads were delivered to the desired sites, devices and geographies, as intended.

3. Offer and request more transparency into inventory and traffic, including sourced traffic and audience extension. Use pre-bid filtering to avoid fraud in programmatic buys. Where needed, use ad.txt or ads.cert technology and exclusion lists.

4. Use attribution tools like fingerprinting (from Kochava, AppsFlyer, etc.), time stamps and device ID to ascertain provenance correctly.

5. Finally, focus less on low CPMs and more on hitting real KPIs suited to the brand’s core campaign goals.

In sum, as ad fraud becomes more advanced, the digital industry needs sophisticated detection methods and proactive measures to effectively avoid it. Using a layered approach to detection is vital, combining rules-based methods that evaluate at the impression level, along with machine learning that can identify likely fraud patterns. And marketers, by setting aside perhaps 10 per cent of their marketing budget for ad fraud prevention or detection tools, can prevent up to 30 per cent per cent worth of potential wastage.

(Vidhu Sagar is managing director - India, MediaDonuts, a decade-old digital media and technology company.)