Fraud, Ad Fraud, and Outcomes

Fraud, Ad Fraud, and Outcomes By Kyle Smith
Fraud. We all deal with it in one capacity or another in business. It’s what causes loss. It makes numbers seemingly not add up. It makes your inventory counts incorrect. Fraud can take many different forms and can affect every business differently from skewing ad buys and outcomes to creating losses in the ecomm and retail space. When it pertains specifically to advertising and campaign management, we refer to it as ad fraud. However, in nearly any other industry, it’s simply known as fraud. But make no mistake, whether you call it fraud, ad fraud, or simply just loss, the commonality is the same in that it hits your bottom line in the form of costing you both time and money. Fraud can manifest in varying degrees and persist across channels. You may be capturing leads on a website, selling a product via an app, or even measuring the viewership of a video. Fraud, in one way or another, will leak into your medium. Zooming out and looking at the picture in a broader scope asking ourselves where fraud comes from and how, then we can begin peeling back the layers and labeling it into a few different classifications such as Proxies/VPNs (anonymous connections), Invalid Traffic, and Viewability. Proxy/VPN Fraudsters hide behind anonymous connections to pass off credit card fraud, create duplicate accounts, hijack existing user accounts, and to circumvent geo enforcement. This kind of high risk activity is problematic not only because it presents additional liability, but can also lead to things like compliance issues and exaggerated usage statistics in the least of scenarios. Losses in the worst. Invalid Traffic This can comprise of a few different types of traffic, but the main one is bot traffic. In today’s world there are good and bad bots. An example of a good bot is one that may be scrapping a website to present useful information or to compile statistics. A malicious one is a bot designed to inflate overall numbers, such as views and user counts. Bot traffic can be found anywhere from search engines to social media platforms and can lead to a host of issues ranging from campaign optimization to audience management. Simply put, any grouping of data that includes invalid traffic will yield incorrect calculations and forecasting. Essentially with Invaild Traffic, you’re paying for something that is fake. Viewability Viewability is about the measurement of whether an object scrolled into the viewable space of a monitor or screen. If we expect something to be in-view and it’s not, then we know that there can’t be any outcomes. On the reverse, if we are in fact seeing outcomes and actions that are originating from something that was never in-view, then it may be bots or fraudulent users attempting to game the system. Take Aways Fraud can take many different forms and can come across any channel. There is no single immune path, but how it affects you and ultimately how you handle it is entirely situational to your business or market. If the issue is non-viewable inventory and you’re trying to optimize a campaign, then maybe you exclude non-viewable impression numbers. If the issue is invalid traffic and you need to maximize the ROI of an ad buy, then maybe you start phasing out buys across heavily invalid sources. Finally, if the issue is anonymous connections such as proxies and VPNs then maybe you disable guest checkout and require greater user verification when detecting these connections. In any case, it starts with a proactive approach. Being reactive to a problem that has already occurred can require double the effort. About Kyle: I started one of the leading ad networks in the early 2000s. After the dawn of programmatic, we became an SSP and went on to host billions and billions of monthly openRTB and header bidding auctions. Over the past 20 years, I've worked with many exchanges, thousands of direct publishers and advertisers of all sizes, and have seen the effects of ad fraud firsthand. Today, I run escalated.io We help individuals and companies across the entire spectrum of adtech detect invalid traffic and prevent ad fraud within multiple mediums including display, video, mobile, app, and CTV.
<< Back

By Kyle Smith

Fraud. We all deal with it in one capacity or another in business. It’s what causes loss. It makes numbers seemingly not add up. It makes your inventory counts incorrect.

Fraud can take many different forms and can affect every business differently from skewing ad buys and outcomes to creating losses in the ecomm and retail space.

When it pertains specifically to advertising and campaign management, we refer to it as ad fraud. However, in nearly any other industry, it’s simply known as fraud. But make no mistake, whether you call it fraud, ad fraud, or simply just loss, the commonality is the same in that it hits your bottom line in the form of costing you both time and money.

Fraud can manifest in varying degrees and persist across channels. You may be capturing leads on a website, selling a product via an app, or even measuring the viewership of a video. Fraud, in one way or another, will leak into your medium.

Zooming out and looking at the picture in a broader scope asking ourselves where fraud comes from and how, then we can begin peeling back the layers and labeling it into a few different classifications such as Proxies/VPNs (anonymous connections), Invalid Traffic, and Viewability.

Proxy/VPN

Fraudsters hide behind anonymous connections to pass off credit card fraud, create duplicate accounts, hijack existing user accounts, and to circumvent geo enforcement. This kind of high risk activity is problematic not only because it presents additional liability, but can also lead to things like compliance issues and exaggerated usage statistics in the least of scenarios. Losses in the worst.

Invalid Traffic

This can comprise of a few different types of traffic, but the main one is bot traffic. In today’s world there are good and bad bots. An example of a good bot is one that may be scrapping a website to present useful information or to compile statistics. A malicious one is a bot designed to inflate overall numbers, such as views and user counts. Bot traffic can be found anywhere from search engines to social media platforms and can lead to a host of issues ranging from campaign optimization to audience management. Simply put, any grouping of data that includes invalid traffic will yield incorrect calculations and forecasting. Essentially with Invaild Traffic, you’re paying for something that is fake.

Viewability

Viewability is about the measurement of whether an object scrolled into the viewable space of a monitor or screen. If we expect something to be in-view and it’s not, then we know that there can’t be any outcomes. On the reverse, if we are in fact seeing outcomes and actions that are originating from something that was never in-view, then it may be bots or fraudulent users attempting to game the system.

Take Aways

Fraud can take many different forms and can come across any channel. There is no single immune path, but how it affects you and ultimately how you handle it is entirely situational to your business or market.

If the issue is non-viewable inventory and you’re trying to optimize a campaign, then maybe you exclude non-viewable impression numbers. If the issue is invalid traffic and you need to maximize the ROI of an ad buy, then maybe you start phasing out buys across heavily invalid sources. Finally, if the issue is anonymous connections such as proxies and VPNs then maybe you disable guest checkout and require greater user verification when detecting these connections.

In any case, it starts with a proactive approach. Being reactive to a problem that has already occurred can require double the effort.

About Kyle: I started one of the leading ad networks in the early 2000s. After the dawn of programmatic, we became an SSP and went on to host billions and billions of monthly openRTB and header bidding auctions. Over the past 20 years, I've worked with many exchanges, thousands of direct publishers and advertisers of all sizes, and have seen the effects of ad fraud firsthand. Today, I run escalated.io We help individuals and companies across the entire spectrum of adtech detect invalid traffic and prevent ad fraud within multiple mediums including display, video, mobile, app, and CTV.

<< Back

Blog