ANA’s Giant Bot Fraud Study: Losses Could Exceed $6 Billion Next Year
Findings confirm bots plague all levels of digital advertising, proposes action plan combating the problem.
Nearly a quarter of video ad impressions are triggered by bots and eleven percent of display ad impressions come from bot fraud. On average, 17 percent of programmatic display traffic is fraudulent and 19 percent of retargeted ad traffic is from bot fraud. Publishers looking to boost traffic by sourcing from third-parties saw 52 percent of that traffic come from bot fraud.
These are all findings from a new study commissioned by the Association of National Advertisers (ANA) in what it says is the largest public study of bots in digital advertising. The report concludes that advertisers could lose as much as $6.3 billion to bot fraud next year.
The ANA partnered with online fraud detection firm White Ops to analyze 181 campaigns from 36 ANA member companies, including Intel, Johnson & Johnson, Kellogg’s, Merck and Pfizer. Ad budgets ranged from $10 million to more than $1 billion and the brands ranged across nine vertical categories. Tagged to identify bot fraud, the ads accounted for 5.5 billion impressions in 3 million domains over 60 days in August and September 2014.
“This report identifies specific practices marketers, agencies and publishers can immediately implement to combat fraud and the fraudsters that perpetrate it,” said Bob Liodice, President and CEO of the ANA.
White Ops estimated the total monetary loss by looking at specific ad placements rather than trying to extrapolate by looking at losses within a brand “because bot percentages vary unpredictably across campaigns and placements”.
The study found that while some bot fraud is triggered by completely fake websites, the majority of bad traffic (67 percent) came from bot nets taking over unsuspecting users’ home computers. As users are logged into services such as Gmail, Facebook, Twitter and Amazon, the bots get targeted by advertisers running campaigns on those platforms. The bots can mimic regular user behavior:
Sophisticated bots moved the mouse, making sure to move the cursor over ads. Bots put items in shopping carts and visited many sites to generate histories and cookies to appear more demographically appealing to advertisers and publishers.
Video ad campaigns come under threat by both bots and video autoplay adware, which “used humans who had minimal or no control of the adware applications to fraudulently consume advertising inventory”.
Even premium publisher inventory is not immune from bots. The study found that direct-buy campaigns on well-regarded domains showed bot percentages exceeding 10 percent. Ad fraud was generated by bots and ad injection.
Advertisers are advised to implement continuous fraud monitoring for bots and adware and use bot detection to ensure publishers aren’t sourcing third-party traffic, even when buying inventory from trusted sources.
In reaction to the study’s findings, Linda Woolley, president and CEO of TAG (Trustworthy Accountability Group) said in a statement, “The Trustworthy Accountability Group (TAG) was formed by the ANA, 4As and IAB to take on and eradicate the festering problem of ad fraud. Research like this is critical in building a program that will excise this type of criminal activity out of the supply chain. Fraudulent traffic, as well as malware and IP piracy, are obstacles to the growth of the digital economy, and TAG is committed to eliminating them.”
Michael Tiffany, White Ops CEO, said, “Ad fraud is hugely profitable and is one of the major sources of funding for a global underground responsible for a broad spectrum of cybercrime. To protect this cash cow, adversaries are aggressive, smart and adaptable. As such, the results of this study should not be about building better mousetraps, but about driving substantive change in the industry to alter the economics for criminals, and ultimately drive them out of business.”
In addition to the recommendations to advertisers noted above, the ANA/White Ops report includes an action plan (PDF) for the industry to start addressing bot fraud both at an advertisers level and systematically.