ad fraud

Ad fraud is one of those topics that doesn’t get nearly as much discussion as it deserves. Bring up the topic in a room filled with advertisers and digital marketers, and you can expect eyes to glaze over and attention spans to wane.

But that needs to change. Ad fraud is a legitimate problem – and a costly one too. It is time for advertisers and digital marketers to take it more seriously.

Estimates suggest that ad fraud cost global advertisers in excess of $80 billion in 2022. Those losses represented a 15% increase from the year before. That being said, it will be interesting to see the 2024 numbers when they finally come in. Here’s the point: ad fraud isn’t a minor problem.

Perhaps our collective inability to root out a criminal enterprise worth tens of billions of dollars is our own lack of understanding.

An effective way to illustrate the point is to discuss five ad fraud myths common among advertisers and digital marketers. It is time we get over these myths.

Myth #1: It’s Not a Big Deal

Losing money. A stack of dollars being blown away by the wind.

Far too many advertisers and digital marketers believe that ad fraud isn’t a big deal.

They are willing to acknowledge upwards of $80 billion in annual losses, but they also cite in excess of $570 billion in digital ad sales. A little math indicates losses of 14%. That doesn’t seem like such a big number, does it?

It’s not a big number if you’re only talking corporations willing to spend millions per year on marketing. But to small businesses and mom-and-pop shops, the losses are much greater.

A small company could suffer a complete decimation of its marketing budget and not even know it. It could spend untold amounts of money on digital advertising and get absolutely nothing in return. So yes, ad fraud is a big deal no matter who its victims are.

Myth #2: It’s an Acceptable Part of Digital Marketing

A second myth acknowledges that ad fraud is a problem but accepts it as a normal and necessary part of digital marketing. In other words, a certain level of ad fraud is acceptable to far too many advertisers and digital marketers.

Such thinking would be unacceptable in any other area of business. Companies don’t just accept a certain level of theft by employees. They look for theft. And when it occurs, they respond accordingly. So why do companies treat ad fraud any differently?

To merely accept a certain amount of financial loss as being unavoidable is to throw in the towel and give fraudsters exactly what they want.

Fraudsters depend on their victims not fighting back. The minute victims start fighting back, fraudsters shut down and move on to the next victim. Fighting back keeps them on the run.

Myth #3: We Don’t Know How to Stop It

breaking off a chain

Next up is the general perception that we don’t know how to stop ad fraud. Though fraudsters are gradually becoming more sophisticated, security experts do know how they work.

The experts also know how to stop them. It is simply a matter of putting in the time, effort, and work to do so.

This idea that we don’t know how to stop it is rooted in the fact that few advertisers and digital marketers truly understand the many ways ad fraud is perpetrated. Here are just a few examples:

  • Generating fraudulent clicks on PPC ads
  • Stacking ads on video display networks
  • Taking advantage of accidental clicks on mobile platforms
  • Taking credit for mobile app downloads and installations.

The starting point for stopping ad fraud is to understand how an advertiser is most likely going to be targeted. If you know how fraudsters will attack, you will have a better idea of how to thwart any such attacks.

Myth #4: We Know but We Can’t Stop It

Following the previous myth is a fourth myth that suggests we know about ad fraud, but we can’t stop it no matter what we do.

This may be true to a certain extent, inasmuch as fraudsters are always trying to stay a step ahead. There is still plenty we can do to make their crimes as difficult as possible though.

A good first step is to invest in an ad fraud prevention software package. Fraud Blocker is but one example. Fraud Blocker continually monitors multiple signals in search of potentially fraudulent activity.

When any such activity is found, it is flagged for human security experts to follow up on. The software can also be set up to automatically respond to certain types of threats.

Unfortunately, it is easy to invest in ad fraud detection software and assume that it will solve the problem on its own.

Such thinking is foolish. Ad fraud protection software is just one tool among many others. By itself, it cannot root out ad fraud. But combined with other tools and human expertise, it can do an awful lot for an advertiser.

Myth #5: It’s Only a Problem for Big Corporations

Ad Fraud

The fifth and final myth is that ad fraud is only a problem for big corporations. Fraudsters target corporate marketing campaigns that take advantage of programmatic ad buys.

Since small companies are more likely to avoid programmatic buys, they are less susceptible, right? Wrong.

Fraudsters will go after whoever offers the easiest opportunities. If they need to jump through hoops to steal from a corporation, you can bet they will look for easier targets among smaller companies.

The fact is that fraudsters do not discriminate. They do not focus the majority of their attention on corporate marketing campaigns.

There are several more myths time and space will not allow this post to discuss. Needless to say that ad fraud is a very real and serious problem.

Even though ad fraud only consumes a small portion of digital ad spend, it still costs advertisers tens of billions of dollars every year. Holding on to the myths doesn’t make stopping it any easier.