Stay on the Alert About Ad Fraud

Digital advertising has become the standard in which a brand’s products and services are seen by potential customers. But what if an ad is reported as having been seen—but was actually not seen by someone? This is evidence of ad fraud, and it has been happening on an increasing basis in recent times.

What is ad fraud?

Generally, when ad fraud takes place, a digital ad appears to be delivered to its intended target audience but is prevented from reaching this destination by high-tech methods. Through ad fraud, cybercriminals are able to steal ad spend dollars invested by a brand. As if this were not bad enough, there are additional negative ripple effects to ad fraud…

Lost revenue that truly gets lost

Since a digital ad that was created and programmed by a brand or marketing agency was “seen” by a bot—not a human being—brand exposure, leads, and sales are all adversely affected. Publishers are also hurt as return-on-ad spend (ROAS) and value are diminished. How costly is ad fraud? As David Finkelstein recently reported in Forbes, a study was conducted by Juniper Research, which calculated that ad fraud results in the loss of approximately $51 million per day to the marketing sector. And this figure may double by next year.

For further perspective on the seriousness and potential damage of this situation, ad fraud has been labeled in some circles as “the other pandemic,” as mentioned by Jean-Christophe Peube in Exchange Wire. That’s bad.

What are the types of ad fraud?

Click fraud, software development kits (SDKs), and what is known as click spamming or click injection are but three of many types of ad fraud:

Click fraud

This is a very common type of ad fraud where bad bots “click” on pay-per-click (PPC) ads that wind up spending an advertising budget and generating false clicks. In short, the bot appears as if it is a human being, and the impression is that a webpage or ad is getting more clicks than it really is.

Software development kit (SDK) spoofing

A bot is created inside an app. From here, phony installs and clicks are generated that use data from real devices. (In other words, no actual installs take place, but appear to happen.) The malicious bot interacts with mobile measurement partners (MMPs) and becomes registered.

Click spamming (or click injection)

This follows a similar modus operandi to click fraud, although it’s carried out through apps. Networks of “install broadcasts” are set up among cybercriminals to alert them when an app launches for the first time. Then, they can detect when other apps on a device get launched, and they inject clicks before completion of the install, and obtain false credit and attribution.

The above are only several of many types of ad fraud, which are listed and further detailed by Pia Subramaniam in Business of Apps. Other types of ad fraud include bot traffic, location masking, domain spoofing, ad stacking, and ad injecting, among others.

Warning signs for mobile ads

Where mobile ads are concerned, marketers should pay close attention to performance, particularly when there appear to be inaccuracies or signs of erratic activity. Signs for mobile ad fraud include:

  • Little-to-no performance
  • Low conversion rates (and less revenue)
  • Unusual spikes in clickthrough rates (CTRs), as well as the number of clicks or impressions
  • Poor performance, which might be evident by bounce rates and session duration
  • Unknown or unrecognizable site placements

Escalation of ad fraud

This report in Forbes is another unfortunate example of the spread of cybercrime in advertising. Last year, it was reported that nearly one million Android devices became infected with malware which replicated ads that had been appearing on streaming television. Through this scam, hackers were able to enter and steal revenue that was intended for the advertisers who ran these affected (or infected) in-stream ads. Whatever the high-tech subterfuge may be, the honest delivery of an advertisement to interested customers is jeopardized, not to mention costly. And being ignorant or lax in how to guard against ad fraud is not helping the situation.

Being responsible and proactive

As ad fraud continues to proliferate, every business owner with an online presence must step up and be proactive in protecting his or her enterprise. If not, they will have only themselves to blame. As Mr. Peube theorized: Companies that don’t actively fight against fraud will start to be seen as complicit. 

Solutions to these situations have been tested, and continue to be fine-tuned to fight fraud.

Database housecleaning

Marketers can help themselves stay alerted to when ad fraud activity occurs, by keeping their databases clean, updated, and streamlined. It may not prevent ad fraud outright, but will limit the number of inaccurate positives that might show up in analyses and reviews.

How ad fraud detection works

Just as security sites like LifeLock were established to guard against identity theft, companies specializing in ad fraud detection software have emerged—and grown. Through ad fraud detection software, patterns that appear suspicious are detected from data sources that include clicks, traffic, impressions, and IP addresses. This software has the functionality to compare ad clicks on its database. If something seems out of place, users are notified and advertisers are able to analyze the relevant data. Additionally, these analyze every bit of activity—from installs to events—in real-time.

And here’s a thought for consideration: As tools and software are developed to protect a website’s analytics, cybercriminals will likely find ways to bypass or increase their ad fraud machinations. This battle of wits on the Internet will be ongoing.

 

If you conduct business and promote ads online, it is beyond important to stay alert to all things digital—whether the news is good or bad. Data analytics on everything, including your social media campaigns, must be taken into account where ad fraud is concerned.

But don’t panic or get paranoid. While ad fraud is a serious concern, it need not keep you from gaining customers and building up true relationships with them. If your business has a digital presence, you will hopefully never be faced with the possibility of ad fraud. In any event, it is good to have an extra degree of security.

A full-service, 24/7 digital dashboard is among the many services offered by Raydeus Local, where all marketing campaigns and important metrics are kept and displayed in one place. The marketing reports from Raydeus Local include everything from paid search to email marketing, among many other metrics. So, in the event something about your online performance looks out of place, you will know soon and be able to take action. (After all, knowledge is power.)

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