The 3As of fighting ad fraud

Each year, digital media advertising is growing at over 30%, and expected to have the same acceleration till 2022. This is great for everyone involved in the advertising industry. There is another group, who the advertising community is making super rich, and that’s the fraudsters. There is a growing clarion call in the west to term ad:fraud community as the next mafia, for they have the highest ROI, at times running into over 1000%.

The latest ad trend report from WARC states the following;

1. 8% average fraud rate for non-optimised programmatic ads
2. 11% risk adjacency with programmatic ads
3. 13% of the Facebook accounts are useless for advertisers
4. 20% of consumers would take action against a brand due to negative adjacency
5. 23% of the viewable desktop ads are actually seen
6. 46% of the ads are not viewable by MRC standards
7. 55% rate of ‘tech-tax’ with programmatic chain
8. 76% click fraud rate for programmatic half page desktop ads

I am sure that most of the advertisers would have had a discussion on these lines in the past with their peers or with their agency, especially after returning from a conference. There is a lot of gusto during the initial days of discussion, which soon wanes out and finally dies when the talk of extra investment comes in. If this has happened to you as an advertiser, then please do not think you are alone. Majority of the advertisers know about it, but do not have the knowledge or the will to act.

Let us convert the above stats from being a good looking number in the annual presentation, to what it actually means. To make it fun, let us start in the reverse order;

1. A business that has spent INR 1 Cr on programmatic buying for desktop, which includes Google by the way, loses INR 75 lacs to fraud

1. A business that has spent INR 1Cr on programmatic buying, can spend upto INR 55lacs for using the technology stack which consists of DSP, SSP, DMP, Tracking, Measuring, etc, which the business isn’t even aware of.

1. A business that spends 1cr on display advertising loses INR 46lacs because a human did not see 50% of the ad space for more than 1sec, ie almost 0 recollection

1. If a business spends INR 1Cr on desktop advertising, INR 76 lacs is lost as the ads aren’t viewed by humans

1. If a business advertises in brand unsafe environment, 20% of the consumers who see the ads would change their perception about the brand. This also means that business can lose upto 20% of direct revenue, which is far higher than the loses in advertising

1. 13% of all the accounts that are present on Facebook are either fake or bots. Business should always consider this number while reporting Facebook ads details.

1. If a business spends INR 1Cr on programmatic, it loses INR 13 lacs to brand unsafe environment & potential 3% of the overall revenue due to negative adjacency.

1. If a business spends INR 1Cr on programmatic, INR 8 lacks in lost to ad-fraud

These stats are in isolation, now imagine how it would be if taken together, a business losing to Ad fraud, low viewability, fake accounts, brand unsafe environment, etc?

In the fight for a cleaner & efficient digital media ecosystem, what business should follow is the 3As.

1. Awareness – Businesses need to be aware of the various challenges that they are facing or going to face while increasing the budget in digital media. This can be achieved by various means including conferences, training programs, reading up, etc.
2. Assess – Once you are aware of the challenges, you need to asses the current ecosystem, where you are spending money. The investments can be few lacs or few crores, it really doesn’t matter. The assessment needs to be done by a third party audit firms, who understands the challenges and looks at all the data points objectively & not subjectively.
3. Act – Once the assessment is done, the business needs to create acceptable guidelines for the organisation when it comes to the fight against ad fraud, for today & tomorrow. This again needs to be done by a third party who can bring in industry knowledge and help the business in pushing the needle as much as possible.

Any business, that doesn’t follow the 3As of fighting ad fraud, will only have short terms gains and long term losses. Short terms gains because you are fighting what’s there today, and long term losses because ad:fraud industry is evolving each day.

Rahul Vengalil is the CEO of What Clicks, the leading digital media audit firm in India. He can be reached at [email protected]