Every year, there always seems to be some hot, new craze circulating within the digital space, and as soon as the industry believes, “This is the year of mobile!” or “Native ads will take over the Internet!” – a new trend is already emerging.  Due to this, there seems to be a major focus on becoming a leader in the advertising community which tends to overshadow certain aspects of the space that are just as important:  programmatic ad fraud, viewability concerns, and inventory quality.  If the industry has a desire to reverse the stigma associated with programmatic advertising, for once and for all, it is necessary that we address the very element that breeds mistrust:  Fraud.

One of the issues within the programmatic space, since its inception, has been ad fraud.  In fact, programmatic buys have reported higher fraud rates compared to direct buys.  Based on a study put together by White Ops and the Association of National Advertisers in 2015, programmatic display ads had 14 percent more bots, and video ads had 73 percent more than the average (ANA). 

What is Programmatic Ad Fraud?

Integral Ad Science, a media valuation platform, defines ad fraud as, “the deliberate practice of attempting to serve ads that have no potential to be viewed by a human user,” (Integral). 

At the surface, we usually associate online advertising fraud with solely bot traffic, but it has grown to be so much more than that.  In addition to Click bots, other forms of fraudulent activity can include:  auto-refresh traffic, ad-stacking, sourced traffic, and spam-sites. 

Why Does Programmatic Ad Fraud Occur?

Since the very nature of programmatic revolves around being an open market, there are more opportunities for individuals to take advantage of the system, consequently polluting the space (Vidakovic, MarketingLand).  With the recent announcement of Snapchat entering the programmatic ecosystem, the company itself, along with others, is beginning to, “shift away from the use of the word ‘programmatic,’” says Tobi Elkin (Mediapost). 

According to Elkin, the association with, “ad fraud, ad blocking, and other hot-button issues” is driving companies to rebrand and free themselves of the “baggage” this term carries.  While reinvention can be positive and liberating, tip-toeing around the usage of certain buzzwords doesn’t solve the underlying issue and distancing yourself from it doesn’t make it disappear. 

How Is Ad Fraud Detected?

Luckily, with the rise of additional companies similar to Integral Ad Science and White Ops, there are more resources available for impression/click fraud detection and prevention, however this doesn’t always solve the problem.

Although much has been done in the fight against ad fraud, the beauty of programmatic advertising is that it is ever-changing and before we can truly evolve, acknowledging our own missteps is essential to overcoming the issue. 

There is much talk around cleaning up ad inventory, and very few in the industry neglect to voice the importance of doing so; however, when it comes to acknowledging the culprits responsible for bringing in this ineffective traffic, we’re not always as quick to act. 

For example, “AppNexus. . . said last summer that up to 65% of the transactions it sponsored were questionable – a remarkable admission for any media outlet,” and as a result, the company began building out a verification tool to help identify fraudulent activity (Motavalli, Mediapost).  Many might see this admission as a nail in the coffin, but it is also somewhat refreshing to see this level of transparency in the space.

How Can Ad Fraud be Prevented?

In May, The Trustworthy Accountability Group (TAG) announced that its “Certified Against Fraud” initiative is ready to be put to the test.  According to TAG’s website, “(TAG) is a first-of-its-kind cross-industry accountability program to create transparency in the business relationships and transactions that undergird the digital ad industry,” (tagtoday.net). 

As Allison Schiff states, “the program allows members of the digital supply chain – buyers, sellers and third parties – to earn a seal in exchange for proving their processes are kosher,” (Mediapost).  In collaboration with the Media Rating Council’s guidelines on invalid traffic, members of the program are required to, “submit a thorough background check. . . remove all nonhuman traffic from their counts. . . be transparent about where they source their traffic from,” (Mediapost). 

As culprits behind this fraudulent activity begin to adjust their tactics to get around the current verification tools in place, it is necessary that the industry continues to develop new, creative methods for identifying and blocking this traffic.  There has yet to be a one-stop solution for preventing ad fraud, so until then, our programmatic team believes that multiple steps need to be taken in order to ensure we’re reaching real users on legitimate sites. 

Whether it’s by implementing pre-bid blocking solutions based on site-content or IP addresses with historically fraudulent activity, or through manual, extensive site checks for suspicious-site red flags, our team is continuously looking into new ways to solve this major problem.

With the ongoing concern regarding fraud in our marketplace, it is very likely that more companies like TAG will surface until an industry standard is in place, and if the programmatic space is unable to adhere to the guidelines, regulation may be in our future.  In the words of Winston Churchill, “those who fail to learn from history are doomed to repeat it.”