The Fight Against Fraud in the Digital Ad Industry

Global Digital Ad Spend

With an estimated $225 billion in global revenue in 2017 and a revenue forecast that could hit close to $400 billion by the year 2021, the digital ad industry is a formidable one with remarkable impacts on a wide range of brands and advertisers around the globe.

P&G and its bold move to fight Ad Fraud

Everyone who is linked to the digital media industry, whether it be from agencies or clients and brands, explicitly remembers the strong statement given in June 2017 by P&G on cutting roughly $140 million in digital ad spend for that quarter due to potential waste from fake sites with bot generated fraudulent traffic.

Despite this hard-line approach, the impact of ad fraud has already been the key topic of discussion throughout several conferences, workshops and talks among key players in the industry for some time and several organizations have already engaged in full-scale efforts exploring tech tools to combat non-human traffic and bots around the web. Interactive Advertising Bureau (IAB) and Media Rating Council (MRC) played important roles respectively to establish numerous regulations in connection to audience and advertising measurement standards, as well as legal support for the online advertising industry.

On the other hand, companies who have developed ad technology around brand safety (Integral Ad Science – IAS) and measuring ad placements viewability (DoubleVerify and MOAT) have begun gaining momentum and popularity over the past few years within digital media agencies and prominent advertisers who were early adopters and contributed with important ongoing inputs in the enhancements of such tech solutions.

What is Digital Ad Fraud?

While most people will quickly think of non-human traffic or bots when we talk about ad fraud, it is not the only agent we should consider. Bots are used across the web to generate fake impressions and clicks. Plus, they have the capability to develop fake form submission or action completion which eventually leads to generating faux conversions, causing obvious headaches for brands, agencies and advertisers alike. Nevertheless, we should recognize other sources of ad fraud. A good example is hidden ads – that is, when a publisher creates an ad placement hidden behind another ad making it almost impossible for target audiences to see the advertisers’ originally intended ads.

IAB bids on Ads.txt

In May 2017, IAB launched the Authorized Digital Sellers (Ads.txt) initiative with the aim of improving transparency in programmatic advertising. This idea was first aimed at assisting publishers in identifying who is authorized to sell their inventory, and second, helping programmatic platforms implement Ads.txt files to confirm which inventory they are authorized to sell. This process provides peace of mind to buyers and bidders. Seeing the presence of Ads.txt files verifies that both exchange and publisher have an authentic connection to one another.

Ad Fraud and Blockchain – the future?

Transparency is key in the fight against Ad Fraud. With this in mind – news has started to emerge of a group of key players in the Digital Ad Industry working on developing online advertising exchanges that are built around blockchain technology. This will potentially provide an environment where we no longer see or need individual parties involved in the transactions. On the contrary the technology will provide the industry with visibility and trust needed to avoid Ad Fraud. Recently, several ad exchanges announced their development in this space such as MetaX and AdEx.

Blockchain brings disruption to the digital ad industry. It will be very interesting to see if other major players including Digital Media Groups and Walled Garden bodies help in either quick adoption or instead play a role in slowing that momentum. 

What do you think?

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