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Marketers Must Watch Out for Video Ad Fraud
Video ad fraud is a threat, but companies can take precautions to protect their budgets and reputations
For the rest of the January/February 2018 issue of CRM magazine please click here

At least 100 companies fell victim to video ad fraud schemes recently, having spent portions of their ad budgets to have their creative materials appear on “zombie websites,” which greatly inflated page view counts to make it seem that more people had engaged with the ads, a report in BuzzFeed detailed. 

Ford, Unilever, MGM, and Hershey’s were just some of the companies that lost money after buying ad space from seemingly credible partners in their supply chain. 

“Ad fraud is one of the most important challenges facing the industry,” says Leslie Bargmann, director of client services at Jun Group, an advertising company. “And the most popular placement, video, is not immune to this multibillion-dollar scheme.” 

Video advertising is a prime target for fraud because the cost-per-thousand (CPM) impressions “are so high,” explains Reid Tatoris, vice president of product outreach and marketing at Distil Networks, a bot detection and mitigation company. Advertisers are willing to pay more for viewable videos, and even more for completed views. But “smart fraudsters can easily program bots to game both of these metrics.” Distil Networks has conducted studies that prove that video completions are lower when ads are targeted at verified humans. “This makes sense because humans don’t like watching ads, while bots are happy to sit through them.” 

Programmatic video has also been so problematic because most executive-level marketers don’t understand how the supply chain works, according to Jason Beckerman, CEO of Unified, a business intelligence platform designed to help companies get the most out of their advertising budgets. He points out that too often they rely on third-party agencies to help them buy ad space, and the result is subpar performance. Such agencies are mostly concerned with “getting the job done” as opposed to getting it doing right, because an unspoken goal of theirs is to spend the money as quickly as possible. 

In agreement is Vlad Shevstov, director of investigations for Social Puncher, one of the advertising companies whose research helped expose the video ad fraud scheme for BuzzFeed. He says that, as horrible as it might be, the main goal of most publishers and advertising systems is to sell cheap traffic to companies for as much as they can. “Therefore, no one on the side of advertising systems is interested in strict verification: More advertising views equal more money.”

In such an environment, companies need to take proactive steps to protect their reputations and make sure they are not being duped by malevolent players.

According to Beckerman, technology can be used to alleviate some of the difficulties companies have. Unified provides a transparency tool to help companies see everything that goes on in their digital advertising ecosystems and make sure that agency partners are not doing anything they shouldn’t be, he says. 

However, Shevstov argues that “software cannot solve the problem of advertising fraud.” He holds that since people are looking at ads, people, rather than machines, should be evaluating its effectiveness. 

Tatoris recommends that companies buy direct when possible. “I know this is a pain, but if you are buying inventory that’s been resold five different times, you run a really high risk of hitting a video farm.” 

He also warns against using completed views as an indicator that someone watched your ad; all that means is the ad played through to completion. He suggests that companies use follow-up actions to confirm that real people watched the ad and then took some step as a result. 

"First, advertisers should partner with trusted verification vendors" that track where ads run, verify human viewing, and measure ad interactions, Bargmann suggests. "Not all video placements are created equal, and advertisers would do better selecting placements that are in-app and opt-in in nature. In-app ads are highly regulated by Google and Apple, and opt-in placements must be initiated by a person to appear. 

"In the end, advertisers always do best when working with trusted partners, purchasing placements that they understand, and utilizing clear measurement guidelines," he concluded.


 Ads.txt Is Here to Help

Because ad fraud is such a common problem, the Interactive Advertising Bureau's Tech Lab created ads.txt, a simple solution that makes it significantly harder for scammers to offer counterfeit ad inventory, also commonly referred to as spoofed domains. 

The practice, which has been identified as the largest threat to the digital ad economy, typically involves fraudsters who sell ads on one website, mobile app, or other digital property but then actually serve them up on another site at a much cheaper rate. The original site loses money, and marketers waste money buying ads that nobody sees—unless you count simulated human web traffic that these fraudsters create with non-human bots and real human users who are in on the scam. 

Ads.txt aims to help fight fraudulent inventory for mobile, video, and display ads, identify authorized digital inventory sellers, and increase advertising transparency. Using ads.txt, publishers and distributors identify the companies they authorize to sell their digital inventory, including domain owners that sell on exchanges through their own accounts; networks and sales houses that sell on behalf of domain owners; and content syndication partnerships where multiple sellers represent the same inventory.

IAB officially published the voluntary ads.txt standards in September and initial adoption was slow, but the initiative is expected to pick up steam as ad buyers pressure sellers to effectively adopt ads.txt or be blocked. Google, one such provider, recently fell victim to ad fraud and vowed to only buy from publishers that have adopted ads.txt going forward. Many other prominent media organizations are following suit. 

To find out which sites are using ads.txt, advertisers can type in a website name and add "/ads.txt" at the end of the URL. A list of links will appear displaying all the sellers that have been verified by the publisher.

Tamer Hassan, chief technology officer at White Ops, a provider of automated threat protection, was a member of the ads.txt working group. 

"Ads.txt is one of the least expensive yet most effective defenses against many methods of domain spoofing. By listing the companies authorized to sell its inventory, a publisher makes it easy for an advertiser to verify the legitimacy of the purchase. This is an important architectural change to programmatic advertising that will have a lasting impact," he says. —Leonard Klie

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