Display Is The New Search: A Familiar Battle With Fraud
Many industry insiders remember Google’s 2006 AdWords addition of “invalid clicks” and “invalid clicks rate” metrics, which prompted insight into the volume of fraud affecting search. Fast forward nearly ten years later, and it might seem as if history is repeating itself all over again — click fraud is invading display.
In fact, fraud is an even larger concern today considering how much the Internet has grown in just a decade. With a never before seen volume of inventory at their disposal, fraudsters are employing search-era tactics to game the display system using fake clicks.
Feeding The Fraud Epidemic
Further exacerbating the fraud epidemic are ad exchanges and the advent of real-time bidding (RTB), offering media avails at unforeseen rates. RTB offers marketers a strong value prop in terms of cost efficient and effective media buying, even with fraud. However, if we can begin to eliminate fraud in display, RTB will become an even stronger and more prominent channel for advertisers.
While click fraud looms large across digital channels, display faces a series of new challenges arising out of technological advancement and more covert attempts at fraudsters’ profiteering. Display’s unique issues include click fraud from humans and even more so from highly advanced bots.
Also known as botnets (an abbreviation of “robot” plus “network” — bots entail code that resides on your computer while network signifies their sheer volume), these bots can number in the thousands or even more, and pose a huge threat since so many of them can coordinate at the same time to commit fraud across a large area.
A prominent source of fraud is ad laundering, which entails selling impressions wherein the original source of traffic and/or other delivery characteristics are obfuscated, altered or misrepresented by the seller/publisher. Ads displayed on inappropriate sites, such as piracy sites, showcase a common form of ad laundering.
The subsequently inflated impression rates and skewed performance threaten the growth of digital display as well as its push for quality assurance, specifically within real-time buying. A panel of industry experts gathered recently in NYC to discuss RTB, viewability and fraud. The panel said that because nearly 50% of ads don’t meet viewability standards, RTB offers a mechanism to save time and money by filtering out low-value impressions.
Fraud Hits Marketers & Publishers Alike
Click fraud within search singled out marketers as the main victims of higher ad fees and skewed SEM performance due to “invalid clicks.” In display, the scope of impact is incredibly expansive because so many intermediaries are involved, meaning it’s not just marketers that are feeling the heat. In display, publishers also suffer the brunt of the burden as their inventory costs take a hit, which in turn hurts their revenue. For marketers, this means their ads are simply going unseen, resulting in wasted media dollars and inaccurate media measurement.
Just as search evolved to stamp out as much fraud as possible, display needs to follow suit. Search fraud has been so significantly reduced that it is now only a minor concern with a small percentage of traffic tracked as fraudulent. This is good news for display.
If we can reduce fraud, CPMs will increase, creating more revenue for publishers and increasing the credibility and validity of digital display advertising. As marketers gain confidence that their ads are being seen across display channels, you can be sure that budgets will grow and more money will be spent in real-time buying.
Push For Industry-Wide Standards
While we can always expect a margin of error, we need to take into account the efforts set forth by Google back in 2006 and look to PPC for guidance. Fortunately, we are beginning to see a large number of leaders from ad tech companies push for industry-wide standardization and solutions to display viewability issues. We need to get marketers back to a place where they are confident that their display ads actually generate promised impressions, and where publishers can price appropriately for their inventory.
We should not expect this problem to be resolved overnight, but organizations such as the IAB, MRC and 3MS are making strides to help the industry achieve a respectable level of viewability across campaigns.
Keep on the lookout for more information about the Traffic of Good Intent (TOGI) task force along with news related to the viewability standards. At the end of the day, we should find solace in the fact that this is not our first rodeo. We conquered this in search and will do the same in display.
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