Ad fraud & Programmatic
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The document discusses various forms of ad fraud in the programmatic advertising ecosystem, highlighting the distinction between non-human and human traffic fraud. Non-human traffic often involves bots and botnets that generate fake impressions and clicks, while human traffic fraud can arise from methods like ad stacking, arbitrage, and click farms that exploit real users. Factors contributing to the prevalence of ad fraud include the open nature of the marketplace, lack of legal consequences, and incentive structures that prioritize volume over quality.
Ad fraud & Programmatic
- 1. Mcounts Consumer Solutions Ad Fraud & Programmatic Neeraj Mishra | Mcounts
- 2. Mcounts Consumer Solutions Ad Fraud has one or more of these characteristics Non-human traffic (i.e., bots). Zero chance of being seen (i.e., 0% viewability). Intentionally misrepresented.
- 3. Mcounts Consumer Solutions Non-Human Traffic Most non-human traffic is used to generate fake impressions (page views) and fake clicks. In some cases, they go so far as to generate fake form submissions, and therefore, fake conversions. Simple Bots Sophisticated Bots Botnets
- 4. Mcounts Consumer Solutions Non-Human Traffic Simple Bots Simple bots are essentially just scripts that run from a server somewhere, like Amazon Web Services or some other hosting provider. Because they are simple, they are usually easy to identify — since they have a static IP, user agent, cookie ID and so on — which makes fingerprinting and blocking them relatively easy. A simple look at some DSP* auction logs, or even Web server logs from those that click through, make simple bots fairly easy to detect and block. For example, one could simply block all known data center IPs. DSP = Demand Side Platform
- 5. Mcounts Consumer Solutions Non-Human Traffic Sophisticated Bots Sophisticated bots, on the other hand, employ tactics like rotating user agents, using random proxies (to rotate IP addresses), mimicking normal click-through rates, and in some cases, even mimicking real mouse movements from captured browser activity. All of these factors make it harder to fingerprint and block them.
- 6. Mcounts Consumer Solutions Non-Human Traffic Botnets Botnets are generally a large array of personal (residential) computers that have been compromised by bad actors. These actors have control of these machines, employing them for tasks like loading and clicking on ads, which generates legitimate-looking, but ultimately fake, impressions and clicks for advertisers. Botnets are the hardest to detect and block, but they are also highly illegal and, therefore, riskier for bad actors to deploy.
- 7. Mcounts Consumer Solutions Human Traffic Human traffic, on the other hand, is perhaps even more sinister because the end users are real, but the impressions (and in some cases, clicks) generated are fraudulent. Since they are real people, it can be harder to detect by vendors that are only looking for bots. Invisible Ads Arbitrage Domain Spoofing Site Bundling Ad Injection Cookie Stuffing Click Farms
- 8. Mcounts Consumer Solutions Human Traffic Invisible Ads Two Main ways: “Ad stacking” or “Impression stacking,” Hiding ads behind other ads. In such cases, the publisher is generating multiple impressions for a single page view, but the only ad that is visible is the top one. "Invisible iFrames" Intentionally hiding ads by loading ads in unviewable (1 pixel by 1 pixel) iFrames, an impression or multiple impressions are generated, with no chance of ever being seen. Such tactics are relatively easy to detect using off-the-shelf ad verification tools like Integral Ad Science or Pixalate.
- 9. Mcounts Consumer Solutions Human Traffic Arbitrage One of the most under-reported but insidious forms of human-based traffic fraud is a form of arbitrage. In essence, the bad actors purchase traffic for a very low cost and resell it for a multiple of the price. For e.g:, a publisher may sell their inventory for $5 CPM on average but may be purchasing questionable traffic to their site for a fraction of that cost.
- 10. Mcounts Consumer Solutions Human Traffic Domain Spoofing In the RTB (real-time bidding) ecosystem, publishers are sometimes allowed to declare their own domain and the label of their Site ID. Fraudulent publishers use this as an opportunity to misrepresent their inventory. They may identify themselves as washingtonpost.com, but if you dig deeper, the actual domain the ad was served on was different. In other cases, the ad-serving domain is spoofed within the bid request.
- 11. Mcounts Consumer Solutions Human Traffic Site Bundling Site IDs are how inventory is classified in the RTB ecosystem. The way RTB was designed, each Site ID was supposed to correlate to a single domain. But in practice, many publishers and exchanges bundle entire networks of domains under single Site IDs. So an advertiser might think they are buying abc.com but end up with ads served on xyz.com. This configuration happens on the supply side, which is outside the control of DSPs (demand-side platforms). This falls under the “intentionally misrepresented” inventory category.
- 12. Mcounts Consumer Solutions Human Traffic Ad Injection As a result of browser toolbars and other adware plugins, ads can get injected and/or replaced on any site, often without the user or publisher noticing. This creates a situation where ad inventory might show up as facebook.com, for example, but is no way related to Facebook’s actual ad inventory. After all, any Facebook user could tell you that there are no 300×250 or 728×90 banner placements. But with ad injection, inventory can be created on premium websites out of thin air.
- 13. Mcounts Consumer Solutions Human Traffic Cookie Stuffing Cookies are just as important today, because they are the mechanism through which a large part of the programmatic ecosystem targets audiences. And with inexpensive sources of internet traffic available for purchase, cookie stuffing to dilute or misrepresent audience target data is now a real thing. It’s also worth noting that cookie stuffing can occur on both human and non-human traffic, so technically, it could fall into either category, and sometimes both.
- 14. Mcounts Consumer Solutions Human Traffic Click Farms There are incentivized programs, often masked as “work from home” or “make money online” schemes, that pay real people to click on ads and even fill out forms, resulting in valueless impressions, clicks and conversions. Since these are real people, it’s hard for most software vendors to catch these schemes, but they are most definitely fraudulent activity.
- 15. Mcounts Consumer Solutions Why Programmatic Ad Fraud Exists Open nature of the programmatic advertising marketplace Ad fraud is technically not illegal Lack of proper incentives across the entire supply chain
- 16. Mcounts Consumer Solutions The programmatic advertising ecosystem is based on being open. This means that any advertiser or publisher should be free to participate in the marketplace. Because the barrier of entry for new players is so low, anyone can sell and anyone can buy. This is a good thing for smaller advertisers, agencies and publishers — but it’s also beneficial for bad actors. Why Programmatic Ad Fraud Exists Open Marketplaces
- 17. Mcounts Consumer Solutions Unlike credit card fraud, nobody is going to jail for ad fraud, and it’s not exactly the sort of activity that elicits a crackdown from law enforcement, which means there is significantly less risk involved. Higher the payoffs, the higher the levels of fraud. There is roughly twice as much fraud in video as there is in desktop display. This makes sense when you consider that video CPMs average at about $9, while traditional display is more in the $1 to $2 range. Why Programmatic Ad Fraud Exists Ad Fraud Is Not Illegal
- 18. Mcounts Consumer Solutions Programmatic advertising, and ad tech in general, almost everyone makes their money on volume and transactions. In other words, the age-old CPM pricing model rewards volume. The first major problem with the whole CPM foundation of practically all display advertising is that it incentivizes pageview-driven publishing practices: multi-page slideshows, auto-refresh ads, click-bait journalism, regurgitated reporting and so on degrading the user experience of the web for everyone. Since CPM incentivizes and rewards scale, many publisers pursue scale by any means necessary, including questionable traffic acquisition, which deteriorates the quality of the ad tech ecosystem. Why Programmatic Ad Fraud Exists Lack Of Proper Incentives
- 19. Mcounts Consumer Solutions Neeraj Mishra neeraj@mcounts.com +91-77 99 65 6664 Queries?