Will the adtech industry be able to put an end to fraud?

  • July 13, 2016

Will the adtech industry be able to put an end to fraud? by Tim Sleath

The adtech industry is not without its daily challenges. However, some challenges present themselves as significantly more prominent, complex and influential than others. In particular, fraud has remained a constant problem.

A report by the Association of National Advertisers in the United States revealed that advertisers will lose $7.2 billion in 2016, a jump from $6.3 billion in 2015. In an industry that is estimated to be worth £19.6 billion in 2015 in the UK, are we investing enough money and resources in tackling what could be seen as one of the industry’s most prominent threats?

Furthermore, ad fraud can also be closely connected to some other big issues that are disrupting the adtech industry. In particular, viewability has arisen as one of the most divisive industry trends. The standards for measuring whether or not an ad was viewable is crucial for the industry to move forward. However, viewability itself can also present an opportunity for fraud to occur. Understandably advertisers want their ads genuinely to be seen by an engaged audience. But with the influx and evolution of bot-related fraud, it remains a topic that baffles the industry.

When online ad fraud was first recognised, it was known as Non-Human Traffic (NHT). This is a combination of benign and malicious bots which can inflate impression counts across the internet and therefore can blur the effectiveness of viewability. There has been some progress since NHT was first acknowledged with the New York-based Media Rating Ccounil (MRC) stating that vendors should remove NHT before assessing viewability. 

The MRC has gone a step further by renaming NHT Invalid Traffic (IVT) and issuing definitions which outline two fundamental types of bots that create fraudulent impressions. Firstly, there are the easier-to-spot General Invalid Traffic (GIVT) bots. Then there are the Sophisticated Invalid Traffic (SIVT) bots which are more difficult to detect and require a number of methods to identify including analytics and human intervention. 

With both types of bots, the MRC has set guidelines stating what should be removed before assessing viewability. The guidelines state that all vendors must remove GIVT and are encouraged to remove SIVT, or at least encourage the buyer to use a separate SIVT filter. While this is not yet a set industry standard, it is a crucial step in improving the quality of the advertising campaign and user experience.

With marketers spending more money on digital advertising, these bots are becoming more commonplace and ad fraud continues to grow. So how can the industry work together to combat this threat and where does the responsibility lie?

The industry has allowed ad fraud to develop either through ignorance or laziness. The pace to create processes and capabilities to tackle the issue is increasing and I predict those staggering calculations of fraud could prove a high-water mark which we will one day refer to with amazement. However, if the industry tries to increase awareness of the problem, it will spur interest in technologies designed to audit ad campaigns. Already, we are starting to see a number of companies which are in the beginnings of developing the technology to do this and attempt to stop fraudulent traffic at its source.

While this has been slow in the UK, the recently-launched anti-fraud initiative of the Trustworthy Accountability Group is the US industry’s approach to putting the squeeze on fraudsters by ensuring effective knowledge sharing between and use of best practices by reputable companies.

There has been some progress in tackling fraud in the UK with ISBA, IAB and the IPA setting up the Joint Industry Committee for Web Standards (JICWEBS) to establish good practice and guidelines to reduce the risk of fraudulent ads. In May 2016, the committee announced it would provide certification to companies who were actively trying to reduce the risk of fraudulent advertising. Publishers, agencies and ad tech providers will be assessed against six key principles to determine their certification.

In addition to reducing fraudulent ads in the UK, the Project Creative Initiative, run by the City of London Police and JICWEBS, collate an infringing website list of sites known to infringe copyright. The list is the first of its kind to be developed with an up-to-date list of sites, identified and verified by the creative industries and City of London Police to have infringed copyright. While fraud and theft of copyrighted works are separate issues, it is a step to clean up the digital ecosystem as a whole and therefore has an important part to play. 

Although all this progress is a positive step in the right direction and offers a level of transparency, the underlying problem of ad fraud still remains. As with other challenges that have presented themselves within the advertising industry, the companies who look ahead and are able to adapt are the ones likely to come out on top.

Unfortunately, at this time, there is no silver bullet remedy for tackling ad fraud. Instead, it is up to the industry to continue raising awareness around the issue as well as investing more money in coming up with a solution – and bracing themselves for the road ahead.