A publisher’s guide to Ad Fraud

Ad Fraud & Invalid Traffic
November 13, 2023 | by Aleesha Jacob
stop-ad-fraud

Ad fraud remains a pressing concern within the online media industry, affecting publishers, advertisers, and ad networks alike. While the industry has progressed with advanced advertising technology, including sophisticated bidders and ad servers, ad fraud still constitutes a significant challenge. It still continues to be quite rampant, with potential losses mounting each year.

The Over-The-Top (OTT) advertising space, in particular, illustrates the gravity of the issue. Despite OTT’s market size expanding rapidly due to increased consumer demand for streaming services, it has not been immune to fraudulent activity. Latest insights reveal a persistent battle against invalid traffic, which can account for a substantial portion of OTT impressions.

This guide aims to dissect the complexities of ad fraud, arming publishers with the knowledge to understand and protect their ad revenue. Furthermore, we will explore how we are spearheading the fight against ad fraud, employing cutting-edge solutions to defend publishers’ earnings and uphold the integrity of digital advertising. Stay tuned as we delve into the mechanisms of ad fraud and the best practices for counteracting its effects on the digital ad ecosystem.

What is ad fraud?

You’ll be surprised at the lengths fraudsters go to scam the digital advertising industry and all the different types of ad fraud that exist. Ad fraud is an umbrella term used for multiple types of fraudulent methods.

Ad fraud is misrepresenting online ad impressions fraudulently to generate revenue. This video from AdWeek talks about the four most common types of ad fraud. We’ve listed them for you below:

Pixel stuffing is the placement of an ad in an invisible pixel not seen on a page.

Ad stacking – Ad placements that are layered on top of each other while only one gets seen by the user, but multiple impressions are counted.

Misrepresentation/misidentification of a domain is where a quality site, in reality, is an illegitimate site made to deceive the ad buyer.

Ad injections – this is where an advertiser or browser does not permit a publisher to insert an ad onto a page but does and earns ad revenue from it.

Remember that new methods are popping up daily as fraudsters continue to find vulnerabilities to exploit in the digital advertising ecosystem. Clearcode goes in-depth about additional variations of fraud with regard to ad placements, malware, adware, and mobile apps.

It’s also important to keep elements such as invalid traffic and bot traffic in mind when talking about ad fraud from a publisher’s point of view. Both of these illicit traffic sources can ruin a publisher’s business. Invalid traffic or traffic created by bots can lead to fake clicks on ads and cost publishers hefty revenue clawbacks and even outright bans on their ad network accounts.

That’s any publisher’s worst nightmare. Can you imagine checking your ad revenues only to realize you’ve been banned from AdSense or Ad Exchange? Later in this article, we’ll show you how to combat ad fraud, invalid traffic, and bot traffic as a publisher and protect your ad network accounts.

Who commits ad fraud, and why do they do it?

Ad fraud tends to be committed by individuals or organized groups with the necessary skills to set up fraudulent systems. However, why would they do it in the first place?

Firstly, there are huge payouts involved when it comes to ad fraud. As previously described, the ad fraud market is estimated to be in the billions. With that, scaling a fraudulent ad campaign is also not that hard. Compare it to other illegal activities, such as drug dealing or stealing cars, which don’t scale as quickly and fraud does.

Once a fraudster gets a payout from an ad network for fraudulent ads, they can keep running that operation indefinitely until they get caught, even if they get caught.

The risk of penalty for ad fraud is also murky at best. It falls into a grey area for many jurisdictions, so fraudsters see that as a limited risk once again compared to other illegal activities where penalties are severe and clear-cut.

The result is a high-paying, endlessly scaling, low-risk endeavor that cybercriminals flock to.

What effect does it have on the digital advertising market?

On the surface, it’s clear that many fraudsters stealing money from advertising campaigns and cheating publishers are bad, but what’s the real effect on the market? How does it affect publishers?

Strangely enough, ad fraud is not meant to take down the digital advertising market. Fraudsters need the market to survive and make their money. Its intent is not destructive, although it might have that effect.

Their goal is to parasite on an ad network and take little cuts of ad budgets over a long period. However, some cases of ad fraud are specifically aimed at corporate entities to cause maximum damage to their operations.

Yet, as advertisers spend their budgets and money moving through the digital advertising ecosystem, publishers get less revenue due to fraudsters. They steal the money out of the publisher’s hands, which creates distrust from advertisers, reduces revenue for reinvesting into their business, takes a hit to their reputations, and more.

You can imagine when a fraudster acts like a Business Insider when they are not. Advertisers then buy ads from that fake site, and in the end, Business Insider gets a bad reputation for serving fake ads and being fraudulent.

It’s worth mentioning that advertisers lose out as well. Their ads get shown on fake websites or through previously mentioned methods, which end up doing almost nothing for them regarding conversions, sales, brand building, etc.

Blockchain’s role in combating ad fraud

As blockchain technology has evolved and become more popular, it has been presented as a solution to ad fraud on multiple occasions. Many have hoped that distributed ledger systems can solve the ad fraud crisis, but so far, it hasn’t.

Surely, open distributed ledger systems that blockchains can provide would be able to filter and detect fraudulent ad activity? According to eMarketer, a part of the issue is the fact that not enough parties in the digital marketing ecosystem are using it.

To combat ad fraud fully, all parties participating in a programmatic transaction need to use blockchain. A recent survey also said that only 11% of US agencies have tried using blockchain technology. Adoption is very low, and the fact that blockchain is slow to manage media transactions isn’t helping either. Digital advertising requires speeds of 10 milliseconds, whereas blockchain can only deliver 1.5 seconds at best.

However, blockchain technology can help show advertisers exactly where their ad budgets are going and what publishers end up getting paid. This way, they can cut out the middlemen and avoid unnecessary vendors with reselling schemes.

Blockchain still has a long way to go before it can solve the ad fraud issue. Be sure to read more about the topic at eMarketer.

How to detect and prevent ad fraud as a publisher

Unfortunately, you can’t pull a magic switch to solve the industry’s ad fraud problems. Fighting ad fraud requires sophisticated technology, artificial intelligence, skills, and expertise.

Although Google recommends tips like not clicking on your ads, avoiding partnering with untrusted parties, understanding your traffic, and more, none help prevent unintended or invalid traffic attacks. If you follow all of those points, you are still vulnerable.

However, MonetizeMore has a way you, as a publisher, can protect your ad network accounts from getting banned without it costing you an arm and a leg. That’s precisely why MonetizeMore launched the two-time award-winning IVT solution, Traffic Cop to help publishers detect and effectively block all types of invalid traffic.

Traffic Cop uses advanced machine learning with sophisticated fingerprinting algorithms to identify and block ad fraud. This way, you can classify, analyze, and block many kinds of bot or non-human traffic and keep it away from your ad inventory.

With Traffic Cop, you not only get to detect fraud, but you can also use pre-bid analysis to block these ads from serving fraudulent traffic.

Click here to find out more about Traffic Cop!

Conclusion

The industry-wide issue of ad fraud probably won’t get solved anytime soon. At least with Traffic Cop, you can protect your ad inventory and keep all those fraudulent, invalid traffic away from your ads. Sign up to Traffic Cop today and never again worry about getting banned from ad networks through invalid traffic ever again!

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