date_range 02 Apr, 2020

Is Ad-Fraud a Threat to Digital World?

Ad fraud is defined as the deliberate practice of attempting to serve ads that have no potential to be viewed by a human user.

Each fraud occurs in a matter of a millisecond and often goes undetected. $7.2 billion dollar ad fraud is happening all around, together it is more than the GDP of 42 countries! It is an important and critical issue for the digital world, so the digital marketing community has finally started promoting accountability in advertising.

Half of all online ads are never seen by a human being, huge amounts of traffic and clicks come from bot networks, and fraud is rampant. The media industry has no shortage of things to worry about. Audiences are going elsewhere, whether it’s to social networks like Facebook or digital-only competitors such as Buzz Feed, and so advertising revenues continue to fall—not just for print, but for digital and video and pretty much everything.

**Case Study 1 :**
Website ‘’ was the top generator of video ad impressions on google ad’s exchange with more than 161 million page views per week and less than 1 million unique visitors in a week i.e., 170 video ads per user. Too much? Not only this, the website’s potential annual revenue was $77 million dollars. Later, Google blocked this website on receipts of complaining as it had 100% pirated content and 85% traffic of English site came from Brazil.

56% of the online traffic is driven by Bots, they are never seen by human beings. Bots record ads as viewed when in reality, they are playing in the background or invisible. The digital industry has a lot to worry about, from the audience to advertisers. Audiences are going other places, whether its social or digital-only platforms, advertising revenue will continue to fall – not just for print but also for digital and video. But bigger issues for ad-based media are there, which they hardly talk about much. To be specific, the fact that a huge portion of the advertising market is based on lies and fraud.

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### Why ad fraud hurts publishers?

Superior publishers are being compressed by a convergence of forces such as the challenge to grow their audience to attract ad dollars and the shift to mobile has created an entirely new monetization challenge. But they have what advertisers really want:

- Targeted audience
- Quality content
- Brand safe environment
But premium publishers are being squeezed by a confluence of forces:

The first is downward pricing pressure on CPMs driven by rapidly expanding ad network inventory
The second is the challenge of growing their audiences to attract ad dollars
Finally, the shift to mobile creates entirely new monetization challenges

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For advertisers, on the other hand, network inventory generates notably more supply, allowing advertisers access to cheaper inventory. As a result, publishers must compete with ad networks on price, forcing CPM’s down.

Final words -It’s an industry-wide challenge to drive the changes necessary to limit ad fraud. Instead of pointing fingers, all stakeholders can do their part in making sure that advertising budgets are spent adequately, no illegitimate behavior is incentivized, digital advertising maintains its credibility as a channel, and last but not least, end users are happy.

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