Ad fraud has become a massive problem for the digital advertising industry, with an estimated $42 billion lost to fraudulent activities in 2019 alone.
This loss is expected to reach $100 billion by 2023. Ad fraud is a concern for advertisers and publishers, as it erodes trust in the industry and wastes valuable resources.
There are several types of ad fraud, including bots, click fraud and impression fraud. Bots are software programs that simulate human behavior and generate fake clicks and impressions. Click fraud involves clicking on an ad without the intention of purchasing or engaging with the advertiser. Impression fraud involves falsely inflating the number of ad impressions to generate revenue.
Publishers can take several actions to prevent ad fraud. One effective way is to work with reputable ad verification companies. These companies use advanced technology to detect fraudulent activities on ad platforms. For instance, Integral Ad Science, a leading ad verification company, reported blocking 1.3 trillion ad impressions due to fraudulent activities in 2020. Similarly, DoubleVerify detected over 1.6 million fraud incidents in the same year.
Publishers should also implement ad quality guidelines and monitor their advertising activity regularly. A World Federation of Advertisers study found that only 24% of advertisers were confident that humans were viewing their ads. Publishers can increase advertisers' confidence by providing high-quality content relevant to their audience, and relevant content attracts genuine user engagement and reduces the likelihood of fraudulent activities.
Moreover, publishers should collaborate with their advertising partners to prevent fraud. This can involve setting up strict ad quality guidelines and vetting advertising partners before collaborating with them. An analysis by Forensiq found that ad fraud rates were significantly lower in private marketplaces than in open exchanges. Private marketplaces allow publishers to work directly with advertisers and create a more secure and transparent ad ecosystem.
In conclusion, ad fraud is a severe problem for the digital advertising industry, but publishers can take several steps to prevent it. By working with reputable ad verification companies, implementing ad quality guidelines, providing high-quality content, and collaborating with advertising partners, publishers can help reduce fraudulent activities on their platforms. Publishers must take these steps to protect their reputation and ensure a sustainable future for the digital advertising industry.