As agencies, advertisers, and companies continue to pay premium prices; the ad industry is indirectly fueling the continuance of ad fraud business.

When you type into Google “Ad Fraud,” there is a seriously large number that shows up. There are 124,000,000 websites indexed that we’d confidently presume that a majority of the sites cover the topic of how much fake ads, bad ads, or ad fraud costs the online ad industry.

AdFraud Search

They centre their coverage on how “1 dollar for every 3 dollars spent,” is being spent on online garbage.

Other articles discuss ad filtering solutions. For example, companies like Whiteops, DoubleVerify, Forensiq, and Media Trust- the list goes on and on… all of which purportedly assist in increasing the validity of “quality” ad impressions.

All of these articles can amount to a simple summary:

Billions of dollars lost in ad fraud, and in addition to the money lost, 100’s of millions of dollars more are spent to prevent ad fraud. And the reality is…

Ad fraud is here to stay, so live with it.

Why? Because every day when the next new shiny ad filtering company comes up with a new method to detect ad fraud, there are 100’s of people researching, testing and uncovering clever ways to get past that brand new filter. The more money the ad industry spends on ad fraud technology, the more advertisers are comfortable to pay premiums for supposedly premium traffic which then make it more lucrative to bypass such filters… and the vicious cycle continues.

The Core Problem

Advertisers who have absolutely no financial goals tied directly to their campaign are the problem. Marketing agencies and consultants alike exploit this to no end. Blindly fueling money into the ad fraud industry. or perhaps, not so blindly.

And don’t get us wrong. We’re fully aware of “brand” campaigns or “reach” campaigns that supposedly focus on exposure and “maximum eyeballs,” but frankly speaking- this is industry hogwash jargon used by those who are too lazy to design proper campaigns.

Let us explain further. When you run performance-based campaigns, campaigns that have specific monetary goals by design; it doesn’t matter how much ad fraud you have. What matters is if the amount you spend is less then amount you make. If it’s not, then you optimize out underperforming targets (typically full of ad fraud) until the campaign works. If it still doesn’t work? You depress your bid rates across all targets until you make more money then you spend, resulting in ad fraudsters making less money. (we’re skipping out several steps of variable optimization, flow design, etc… to simplify this paragraph).

Ad fraud is easy to trick ad stats, but not that easy to fake goals, such as objective based conversions through complex sales funnels.

What ultimately happens to publishers or ad fraudsters? They get optimized out and or get depressed bid rates which make it less lucrative for them to continue, which fuels a downward cycle in rates.

It makes it harder to run ad fraud business because it’s no longer as profitable.

But unfortunately, the industry is running the opposite direction. Companies are spending money for “reach,” not performance. In addition to that, they are spending massive amounts of money on ad filters to ensure “premium” reach.

Advertiser’s, the driving demand of the entire ad ecosystem have become accustomed to consuming the premium cost associated with inventory that should be the responsibility of either a) the ad network or b) the publisher.

Where’s the accountability? The sick and twisted side of the ad industry is that when it actually comes down to pointing fingers, it’s a bloody blame game. Everyone blames each other and it all comes down to your tech versus in-house tech versus the publisher. It’s an absolute waste of time.

The Ugly Reality of Ad Fraud

It’s never going to go away. There will always be some level of ad fraud and unless the world radically changes its views on privacy, it’ll continue staying that way. And by radical, we mean Big Brother privacy invasion multiplied by 10.

We’re talking about your phone tracking your behaviours to ensure that you are a real person, not 1 of 10,000 phones stuck on a wall, downloading and installing apps through Wechat (if you missed it, we’re referencing the video a couple of paragraphs above). It will need to track what time you get to work and home (which is monitored when you connect to your trusted wifi networks) and what time you go to sleep and charge your phone (notified by your hardware and when your phone stops moving)… all to provide a “premium” impression.

And some companies privately have this data already, but they certainly aren’t going to share it with your ad networks and 100’s of random partners/publishers to use to verify impressions.

No matter the tracking technology, so long as ads are being called using any digital device, the inputs can always be faked.

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Key Takeaways

The goal here is to live with ad fraud, not to spend massive portions of budgets on filtering technology. No one is ever going to achieve “100%” clean traffic or ads. It should also be inherent that your media buying team should be focused on optimizing out ad fraud – because ad fraud doesn’t convert.

If you’re running media budgets that aren’t tied to monetary goals and don’t have someone focused on building funnels, ask us about our media buying service to review your current sales funnels. No matter what marketing budget you have, there can always be an objective-based conversion. Anyone stating otherwise is outright lying.

No matter how you spin it, marketing has one goal.

Make money.

Don’t blindly spend money – you’re just making it easier for ad fraud to continue their existence.