The Top 5 Myths about Ad Fraud

Ad fraud – specifically bot fraud – is a major problem in today’s digital video advertising ecosystem, and it’s continuing to grow in severity each year. In fact, according the well-publicized study from WhiteOps and the ANA, this year alone advertisers across the globe will lose $6.3 billion to bots.  However, despite growing awareness of the issue, there is still an abundance of confusion in the market about bot fraud. Many aren’t certain what bot fraud is, where it exists, who should be combatting it, and how they should go about fighting it.  Education and understanding are central to finding a solution; the criminals are moving quickly and advertisers, publishers, and ad tech platforms need to keep up.  To that end, following is an overview that dispels the top 5 myths about ad fraud.

MYTH #1: 
Ads that run on premium inventory aren’t vulnerable to fraud. 

Unfortunately, everyone in the ecosystem, including well-known publishers and premium publishers, are vulnerable to bots.  In fact, more than half of bot fraud comes from 3rd party aggregators or “sourced traffic”, who, in some cases, target premium inventory even more than long-tail inventory because of the higher CPMs.  The same higher CPMs are what make video advertising a more desirable target than display for cyber-criminals.

MYTH #2: 
Since publishers are the ones with the bots, it’s their problem to solve.  

Some believe that since bot-free inventory should be a given, advertisers should not expect to pay more for bot-free guarantees.  The reality is that fraud prevention, like any type of security, does come at a price. It’s important for the industry to recognize and support bot prevention efforts, rather than penalize those who are fighting back against fraud. 

Ad fraud is theft, pure and simple, and everyone in the system is victimized by it. In order to keep up with the fraud perpetrators’ latest innovations, we need 100 percent of the industry involved in fighting the problem.  Advertisers, publishers, and ad technology developers must come together with bot prevention specialists to acknowledge the scope of the problem and find a solution that stops this crime from occurring. Ad fraud prevention is everyone’s job.  

MYTH #3:
We’ll never completely eradicate bot fraud, but we can slow it down to acceptable levels.

Fighting ad fraud is like fighting a virus in the body; as long as some cells remain it will keep recurring. So, until every portion of the ecosystem is protected from fraud, the criminals will simply move to unprotected areas and “set up shop” there. 

These are the same criminals that target other organizational areas, such as finance. We need to work together to make digital media an unprofitable sector for cyber-criminals to operate in, and force them to move on.  We need to close the “profit window” with evidence-based fraud measurement that pinpoints fraud the moment it occurs, eliminating the “learning period” that allows criminals to make money until they are discovered.  

MYTH #4:
Bot concerns are too trivial for the C-suite. 

The fraud issue is often exacerbated from within an organization by blind downward pressure on costs from procurement.  What many don’t consider, though, is that ad fraud is indeed a criminal offense, making it imperative for the issue to reach the C-suite. Cyber criminals are stealing shareholder money, and executives in the C-suite have the ultimate responsibility to protect shareholders’ investments.  Until bot concerns rise to the top levels in all affected organizations, the industry as a whole will lack the urgency needed to drive change.  

MYTH #5: 
Everyone in the industry wants to combat fraud.

There are still monetary advantages for publishers and ad platforms who allow bot fraud through their gates. Similarly, there are publishers and platforms that will sell inventory with partial blocking, etc. and make bot-free claims. These groups are not in any hurry to change the status quo, and hinder any movement toward a real solution. 
Of course, the truth will come out in the end. The best way to determine whether a campaign is quality and bot-free is to look at the ultimate outcomes – brand lift or actual sales.  In these scenarios, it becomes evident that the cost of the “human CPM”—the only ones to date who are capable of stepping into a store purchasing a product—is substantially higher on bot-ridden networks than the surface-level, bargain-basement pricing suggests.

What’s the Solution?

In order to achieve an effective solution that truly combats fraud, there are several key elements that Advertisers and Publishers should look for.  A powerful solution will be always on so that it can prevent, rather than selectively identify, fraud the moment it happens; it should also be everywhere, providing end-to-end coverage on every impression and every device; and finally, it should focus on evidence-based measurement to make deterministic fraud decisions about each impression, so advertisers can respond the moment fraud happens. 

With these elements in place, the final – and most important – requirement is 100 percent participation from the industry.  Because as long as bots can find a home on even a single unprotected platform, the issue will persist. We need to collectively break down the bot structure and prevent the criminals that perpetuate ad fraud from making a profit.  If we want to ensure fair pricing, accurate measurement, and strong ROI for all advertisers in today’s ecosystem, we must eliminate bots.  The future of growth of video depends on it.

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