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What is ad fraud and what should SMEs be doing about it?

4 minute read

Would you believe me if I said that half or more paid online display advertisements were never shown in front of live human beings? It’s quite a shocking stat, but one which is real and emphasises the threat that ad fraud is becoming to the online advertising space.

Ad fraud is often described as the act of fooling online advertisers into paying for worthless online metrics, such as fake traffic and leads, through a number of dishonest tactics such as showing adverts outside of the user’s view. Ad fraud affects everyone online, from advertisers, to agencies, and the consumer themselves.

It’s becoming a big problem; Google believes that only 44% of views are human, with the rest coming from a combination of bots, hackers, and spammers. Not only that but ad fraud eats through advertising budgets, makes optimising campaigns a rather pointless exercise, and propels revenue into advertising networks, publishers, and those behind the fake results. This is particularly devastating news to small businesses, charities, and entrepreneurs who are investing precious budget into online advertising to reach and engage new audiences.

One of the big problems that we face against ad fraud is the sheer amount of different forms it can take. Some of these are:

  • Bots and Botnets: programmes that can perform almost all human activities online undetected from a user’s computer, such as clicking on links.
  • Ghost sites: according to Sizmek, this is the most widely reported form of online advertising fraud. They are real websites copied from legitimate websites for the purpose of defrauding advertisers.
  • Ad stacking: many adverts are stacked on top of each other where the impression on the top ‘viewable’ ad counts for the ones hidden underneath.
  • Purchased traffic: normally where advertisers are promised legitimate website traffic but instead receive traffic from bots.

These are just a handful of forms that online advertisers are up against, you can find more detailed descriptions from Sizmek here.

What’s being done about ad fraud?

The good news is there’s lots of big brands and advertisers fighting back against ad fraud, and although we won’t be able to see it disappear completely, hopefully we can become more confident in the fairness of the online advertising space.

Facebook for example are working to “develop more robust standards for viewable impressions” while Google have teamed up with startup Spider.io, a platform that specialises in “weeding out fraudulent clicks around online ads”. Google, alongside other big players such as Yahoo, are also offering credits to advertisers for ‘invalid’ clicks which come from untrustworthy sources and are trying to automatically dispose of fake clicks from payments and reports.

Dedicated and specialised programmes are also being designed and rolled out to help tackle ad fraud. Businesses and advertisers can now invest in ad verification services to keep an eye on any discrepancies within online ads. DoubleVerify, which looks at the quality of each impression, or geoedge which offers malware protection and video ad verification are good examples.

Law enforcement are getting involved too, and arrests are starting to be made for illegal ‘click farms’ where sometimes hundreds of people are employed to increase the number of likes and views on advertisements from fake accounts. Back in 2013, Microsoft and the Symantec Corporation managed to disable a network of 1.8 million remotely controlled PCs using a botnet to participate in ad fraud, valued at least $1 million per year.  

There’s hope that we can also start to use more advanced technology to help us tackle ad fraud especially as the systems and techniques to carry out online fraud will no doubt continue to become more advanced. The Drum recently reported that we may need to be careful though. They warn that having little or no human input when using automated programmes and artificial intelligence to tackle ad fraud could put us at a disadvantage: “criminals are masters at outsmarting the system…A machine doesn’t know what it doesn’t know”  

What can you do about ad fraud as a SME?

The thought of losing your valuable budget to fake accounts and computer systems rather than real potential customers can be disheartening to say the least. There are, however, some ways that you can begin to protect your SME, charity, or start-up from ad fraud:

  • Use an ad verification service: if you have budget you could look to invest in an ad verification service to ensure that your adverts are placed on relevant and most importantly credible websites.
  • Keep aware: have ad fraud in the front of your mind. Flag low performance of online ads by keeping an eye out for high bounce rates, short session durations, and IP addresses from data centres. Keep up to date with the latest news and developments in ad fraud too, so you’re aware of the latest things you need to be looking out for.
  • Monitor your advertising campaigns: it’s easy to sit back a bit once you’ve set your online advertising live. Not only will monitoring your campaigns regularly help you detect if anything suspicious is going on, but you’ll be able to analyse the performance to help get the most from your budget and targeting too.
  • Choose your advertising platforms carefully: where possible influence where your adverts are appearing, opting for higher quality websites, and perhaps excluding countries where ad fraud is particularly high unless they form part of your target audience.
  • Have precise ad targeting: the more targeted your advert the more relevant it will be to your audience, and thinking carefully about your targeting can help reduce the risk of ad fraud.
  • Think about your advert objectives: with lots of online advertising, social media in particular, you have a whole host of different advertising objectives to choose from. As long as it fits with your strategy choosing objectives that are harder to fake can reduce your risk of becoming a target of ad fraud. Clicks and impressions are particularly easy to fake.

Unfortunately, this type of immoral activity forms part of the internet and while we may never be able to eliminate ad fraud completely, hopefully this article has shown that there are ways to reduce the risk of becoming a target while still achieving some great results from online advertising.

Zoe works as a Content Marketing Executive at the UK Domain. Previously working in advertising and the sporting industry, Zoe has over four years experience in marketing.

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