How the booming digital industry is combatting menace of online ad fraud

By: | Updated: May 30, 2017 12:51 PM

A large credit card marketer in India found that 30% of leads generated during its digital campaign were fraudulent, when it dialled up each of these leads to verify.

digital advertisement, digital ads, digital ad fraud, credit card marketer, digital campaign, MobiKwik, Bipin Preet Singh, Yahoo India, Performance campaigns, proprietary technologyWith the digital medium raking in huge ad dollars, it is also becoming a sweet spot for fraudsters.

A large credit card marketer in India found that 30% of leads generated during its digital campaign were fraudulent, when it dialled up each of these leads to verify. Those customers never expressed any interest or filled any form for a credit card, but their contact details found their way on the list. Similarly, when a large B2B technology player in India found that its ads were being served at the second and third scroll, it built in-house tools to track viewability. It accordingly made a repository and contacted individual publishers.

These are not standalone instances. In fact, in a recent interview to BrandWagon, fintech player MobiKwik’s CEO Bipin Preet Singh said one of the reasons he was not looking at monetisation through digital ads was that there was a lot of fraud in the digital ad industry such as misalignment of incentives, overbilling and fake traffic.

Experts say, in the case of large marketers, ad frauds could run into crores of rupees. “Ad fraud could be between 10-30% of all digital advertising done in India, with bot fraud and click fraud being the most common,” informs Lakshmi Narasimhan, chief growth officer, GroupM, South Asia.

In fact, Yahoo’s detection system identifies 20-40% of traffic on its ad tech platform BrightRoll DSP as non-human traffic (NHT) and blocks it pre-bid, leaving less than 5% NHT, as measured by third-party vendors. Fraudsters go where the new money is. As India is a mobile heavy market, the frequency of fraud is higher here. “Fraudsters not only try to deliver and get paid for bot impressions, bot clicks, farmed leads, incentivised installs and fake customers, they can also go to the extent of booking an order and cancelling once they have been paid a commission,” says Sanjay Tripathy, former senior EVP and CMO, HDFC Life.

According to GroupM estimates, the digital AdEx is expected to grow by 30% in 2017 to Rs 9,490 crore, which constitutes a 15.5% share of the total AdEx pie this year. This growth makes digital a very attractive playground for fraudsters, especially as advertisers are not prepared to preempt the fraud and will have to play a catch-up game.

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Performance campaigns: an easy target
Even as performance marketing campaigns might look safer to marketers, it is only an illusion, say experts. The goal is conversion in performance marketing, no matter which website the impression is registered from. In fact, ad fraud is more pronounced in performance-led marketing.

According to Sanjeev Jasani, head, digital, Cheil India, the conversation around ad fraud largely happens for those marketers who work from a lead generation point of view and measure their RoI closely. Sectors such as e-commerce, BFSI, airlines and automobile mostly work on performance marketing and so do B2B businesses like IBM and Lenovo. Performance marketing can thus become an easy bait especially when targets are unrealistic. “The opportunities for an ad fraud arrive when marketers want results quickly. So if you promise 2,000 leads and you are not able to generate that much, it can give rise to ad fraud,” points out Anita Nayyar, CEO India and South Asia, Havas Media Group.

“Ad fraud can be countered if you use metrics like cost per acquisition (CPA) and work with large reputed publishers,” asserts Jasani of Cheil India. For instance, Yahoo uses a combination of proprietary technology, third-party integrations, human monitoring and industry partnerships to make sure that every placement sold is high quality and minimum risk. “Fraudsters go where the money is. Today, the highest CPMs are in video ads. Mobile is another possible risk area as measurement is trickier,” informs Gurmit Singh, VP and MD, Yahoo India.
Also, most brand awareness and visibility campaigns work on a CPM and CPC basis. “Here, the way out is to look at the entire funnel and check from where the clicks are coming — if there are similar IPs,  bounce rate of the traffic, etc. Jasani says that the focus should be on buying viewable impressions and working with established publishers. “Even if you work on a CPA basis with small publishers, the probability of junk is higher as they collect user data and use it for fake leads,” he says.

To go the programmatic way or not?
Even as more and more marketers are considering automated ad buying for better targeting, studies conducted globally show increased concerns around fraud and visibility when it comes to programmatic. According to a recent study by Forrester, programmatic video accounts for 66.5% more fraud than direct video in the US. India, which is still a nascent market for programmatic video, is also seeing a similar trend.

“In India, not many players are utilising programmatic to its full capacity and have restricted it only as a medium of trading. Programmatic should be seen as a strategic buying mechanism across marketplaces,” says Shamsuddin Jasani, MD, Isobar India. “However, you need to work with the right DSP platforms such as Appnexus, Mediamath and The Trade Desk, which ensure that a brand’s digital buys are not only efficient but also effective and addressable across all channels.”

Programmatic also adds several layers between the advertiser and the publisher. While it empowers advertisers to be technologically efficient in reaching their audience, it also allows fraudsters to hide behind these several layers with very little risk of detection. According to Narasimhan of GroupM, it is incorrect to say that all programmatic channels propagate ad fraud. There are reputed programmatic platforms that already have several tools to check fraudulent impressions such as MOAT, Double Verify and Forensiq.

“Ad fraud is also a function of where the inventory is sourced from. If from ‘non-identifiable’ sources, then higher incidents of fraud can occur,” he says. Furthermore, programmatic allows for the buying of premium inventory. It all depends upon the objective of the campaign. “If as an advertiser or an audience buyer, you are being greedy, chances of unfair results increase,” Nayyar cautions.

Despite many advertisers in India still being naive about using digital, there is increasingly more focus on ad fraud, according to Singh while talking about his experience with Indian advertisers at Yahoo. “We are seeing heightened focus among advertisers on engagement and quality metrics like viewability and audible/visible on completion, as proxies for quality supply.

Also, advertisers are asking their ad tech partners to demonstrate their investments in anti-fraud technology,” Singh says. In addition, advertisers are looking at third-party verification and certification programmes as a way to examine their advertising spends holistically and independently across platforms. “While there is no silver bullet to eliminate ad fraud completely, advertisers and ad tech platforms need a multi-faceted approach to best guard against fraudulent attacks,” Singh sums up.

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