The Billions We're Losing in Online Advertising Fraud
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Transcript of The Billions We're Losing in Online Advertising Fraud
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The Billions We're Losing in Display
AdvertisingSamuel Scott
Director of Marcom - Logz.iohttp://www.samueljscott.com
http://logz.io
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£6.5 billion! — Campaign Live
(£88 billion spent globally on digital ads)
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What is an Impression?
“When an ad is requested by a user’s browser”- Interactive Advertising Bureau
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Most Impressions AreNever Seen by Humans
• “20% on a computer or smartphone screen were seen by actual people” — Bloomberg
• “54% weren’t seen by real people”— Wall Street Journal
• “85% don’t have the opportunity to be seen by a real person” — MediaPost
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Ad Network Failure
15% of the time something goes wrong— Wrong ad loads
— Technical failure, nothing loads— Still an impression!
— MediaPost
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Bot Traffic
60% of all Internet trafficis bots
— A bot visit still counts as a page view
— Still an impression!
— The Atlantic
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Publisher Fraud
“25% of the entire entire online advertising market is fraudulent”
— Adweek
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Publisher Tricks
— Changing ad units to 1x1 pixel size— Stacking numerous ad units on top of each other
— Redirecting people to sites they don’t want to visit
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Buying Bot Traffic
— Pay ad network $0.0020 for bot visit— Get $0.0025 to $0.0040 in ad revenue
— 25% to 100% profit margin for doing nothing!
— Digiday
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Bottom Line
Only 8% of display ads have the chance to be seen.
— MediaPost
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Kickbacks & CollusionExample:
— Media buyer spends $1 million on ad network
— Ad network sends $200,000 to a corporate sibling of the agency for a “presentation”
— Ad Age
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ArbitrageExample:
— Media buyer & agencies spend $1 million on ads for a client
— Bills client for $1.2 million for the ad spent
— Ad Age
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What’s Going OnClients give money to agencies & media buyers to buy ads
The agencies & media buyers give money to ad networks
The ad networks give some money back to the agencies & media buyers
The agencies charge clients for more than the ad cost
The clients' display ads are only 8% viewable
The 92% non-viewable impressions still earn moneyfor publishers & ad networks
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The Industry’s Response
IAB goal: 70% viewability — But will countries accept billions of losses?
— $25 billion of online ad spend is under reviewin “Mediapalooza”
Google: ActiveViewFacebook is also working on viewability
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Fire Bad Agencies & Media Buyers
If they say: “Half of my ad spend
is wasted, and I don’t know which half”
Exterminate!
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Adjust Metrics in Human Terms
Spend Impressions CPI Viewability Real CPI
$10,000 100,000 $0.10 100% $0.10
$10,000 100,000 $0.10 8% $1.25
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Don’t Spend in Bad Countries
Country % of Fraudulent Traffic
China 92%
Venezuela 80%
Ukraine 77%
United States 43%
Source: AdWeek
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How to Protect Yourself
See the very last slide of this presentation for a list of resources to learn more!
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Questions?
Samuel ScottDirector of Marcom
Logz.io
[email protected] - @samueljscott
http://www.samueljscott.comhttp://logz.io
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Resources— Moz (my article): https://moz.com/blog/online-advertising-fraud
— Bloomberg: http://www.bloomberg.com/features/2015-click-fraud/
— Marketing Land: http://marketingland.com/many-faces-programmatic-ad-fraud-142335
— Bob Hoffman’s Ad Contrarian blog: http://adcontrarian.blogspot.co.il/
— Individual slides have linked sources at the bottom