Opinion: How technology has reduced digital ad frauds?

ad frauds

With increased internet penetration, the digital advertising market has seen a monumental increase in demand, in the milieu of which there has also been a rise in ad frauds. Alok Pandey of Xapads Media shares how technology can help limit these frauds and focus on genuine results.

While internet penetration increased to 845.68 million in 2021 in India, it is expected to reach 1134.04 million by the year 2025 due to which the demand for traffic is increasing as users consume more online content which has also resulted in a meteoric rise in need for supply for publishers as well, consequently opening the window for more ad frauds.

Taking advantage of this need for supply, fraudsters understand the growth of the Digital Advertising Ecosystem which is 455.3 Bn USD in 2021 and is projected to grow by 645.8 Bn USD by 2024, globally. Hence, they follow fraudulent practices without advertisers’ knowledge.

In other words, this spike in traffic led to a decrease in prices, because in 2019 the cost for acquiring global traffic was 1.75 USD which in 2020 has become 0.93 USD in APAC regions, this sudden supply growth is referred to as Digital Ad Frauds.

Despite knowing this fact, marketers buy digital media in volumes to acquire quality traffic at a low price and this is the biggest challenge for them because it disturbs the brand hygiene and safety, threatens brand reputation, and degrades traffic’s quality too. 

Common Types of Ad Frauds

These types of frauds are getting very sophisticated and need proper understanding, tools, and know-how to curb them. It was estimated that the global cost for digital ad fraud would grow exponentially between 2018-2023 from $35 billion to $100 billion. Thus, fraudsters implement various forms of digital ad frauds, here’s how: 

  • Bot Fraud: Here traffic is sourced via bots or non-human traffic which stimulates human traffic patterns and behaviour and these are used to sell a bulk of impressions, clicks and Installs via source at very low costs. 
  • SDK Spoofing: This is the second most common type of ad fraud with 22.05% of global fraud activities wherein, App Developers spoof the SDK and create bots in the development phase of an app. These bots generate fraudulent clicks and installs which MMP platforms might consider as genuine traffic. 
  • Ad Stacking: A simpler fraud mechanism wherein multiple ad banners are placed on a single ad banner slot one on top of another. The user will see only one ad but the server will count impressions for all the ads in the stack. Owing to this, since 2020, global fake users account for 54.6% of mobile ad fraud activity 
  • Domain Spoofing: Fraudulent replication of popular web domains into a low-quality website is one of the most common frauds in Programmatic buying. Owning the popularity and quality of spoofed domain traffic get high bids which help fraudsters pick a higher CPA than what their domain deserves. Therefore globally in Q1 2021, 611,877 unique phishing sites were detected which represents a 4% increase from 637,3022 unique sites in the previous quarters 
  • Pixel Stuffing / Cooking Stuffing / Click Flood: Often done by fraudsters wherein they do not follow IAB advertising standards and place multiple ads into a single-pixel or on a screen. This is usually against the knowledge of the User and stuff many clicks and websites against the will and knowledge of the user. Often known as Spray and Pray strategy, it costs a very high click and infrastructure cost for advertisers and MMPs and leads to very low eCPC. 

Also Read: Opinion: WhatsApp Chatbot 101 – Automating front-end to reduce human intervention

Role of Technology in Curbing Digital Ad Frauds

The evolution of technology decreases the risk of ad frauds and if advertisers pick a network equipped with AI/ML-based technology, Integrated with highly reputed anti-fraud tools, they can curb the frauds in the very initial phase of the campaign cycle.  We curated the list of steps that help advertisers filter out such traffic with our following offered solutions: 

  • Ads.Txt Certified Traffic: The Authorized Digital Seller is a flexible and secure method of increasing transparency and is used by publishers. The ads.txt file is a script added to a domain that declares the platform is authorized to sell its inventory and supports the domain owners, networks and content syndication partners. We are also authorized with 12,578 Unique Publishers as a validated seller.
  • Seller JSON Implementation in Programmatic Buying: It’s a mechanism that enables buyers to discover the entries who are either direct sellers or intermediaries in the selling of digital advertising. Seller JSON Implementation in Programmatic Buying identifies the final seller of the bid request and nodes in the supply chain to be discovered. 
  • Pre Bid: During the RTB process, a bidder has 100MS to return to the ad and bid for its placement. Herein, the system should be equipped to use a quick and sophisticated pre-bid solution that can help advertisers in exposing the inventory before the actual buying. The process includes real-time analysis of information like IP, UA, Domain, Viewability, Brand-Safety and other essential insights to differentiate between fraud and genuine traffic. 
  • Post Click: It’s a fraud prevention algorithm in the AI that identifies the IVT (invalid traffic) and showcases the same to the advertisers in very granular reports; and they can blacklist the source originating the fraudulent traffic. It’s an ongoing process; therefore, campaign managers need to look at the discrepancies between metrics and performance to blacklist the suspicious sources by paying attention to the spike in traffic clutter. 
  • Third-Party Fraud Prevention Tool: Since 2021, the global cost of digital ad fraud was estimated at $65 billion; thus, relying on an external fraud prevention mechanism benefits advertisers with anti-fraud solutions such as fraud analytics, installs detections, segregation of genuine and fake installs, etc. 
  • Real-Time Reports: Our AI/ML Xerxes assist advertisers to set up real-time reports in their dashboard wherein they can see the current day campaign’s associated activities without any timelapse. This also includes reports as per the Request, Buying, Clicks, Installs reports on the basis of Valid and Suspicious. This enables advertisers to optimize their campaigns and drive the best value for their ad spend. 
  • Granular Reports: It is essential to analyse the campaign performance and which strategies are performing the best because keeping its track record and analysing them provides profitable insights and helps in saving the marketing budget. This helps advertisers understand the campaigns at granularity, incorporating details like source, location, demographics, ad placement etc. that results in increasing ROAS. 

While the fraudsters will always try to look for loopholes in the system, technology along with proactive human behaviour is key to blocking Ad Frauds. 

This piece has been authored by Alok Pandey, Vice President – Sales & Marketing, Xapads Media.