Ad Fraud

As the digital advertising landscape continues to thrive, more instances of fraud are also being highlighted. A report by ANA (Association of National Advertisers) suggested that advertisers on the platform may have been losing as much as 23% of their ad budgets to fraudulent activities. Understanding ad fraud may be the most basic yet most important step for advertisers worried about protecting their campaigns and making the most of their ad budgets. This article will help you do exactly that. In the subsequent sections, we will discuss one of the most prevalent forms of digital ad fraud, commonly known as click fraud. In a nutshell, click fraud is the term used to describe the act of clicking on advertisements with malicious intent. Most fraudsters commit click fraud to claim credit for fraudulent clicks and make a quick buck. Unfortunately, because executing click fraud is relatively simple, it is one of the most common forms of ad fraud. According to some studies, fraudulent clicks account for as much as 36% of the total clicks on display ads. The story of search ads is similarly harrowing, with some estimates saying 11% of all search ad clicks are fake. Understanding Click Fraud So how does click fraud take place? In its simplest form, click fraud is committed using click farms. These are bot-powered or human-powered establishments in developing countries where resources are relatively cheap. This bot or human labor is used to generate fraudulent clicks on advertisements. Malicious publishers, who are usually in cahoots with click farm owners, get paid for these fraudulent clicks, while the advertisers paying for the clicks get no real value from their campaigns. Since many click farms employ real human beings, their activity closely resembles genuine user behavior, flying under the radar of fraud filters used by advertising platforms. Other click farms employ networks of sophisticated bots that can replicate human activity and pass through the ad platforms’ fraud filters. Besides the obvious objective of making a quick buck, fraudsters may employ click farms for a variety of other reasons. For instance, some businesses may employ the services of a click farm to undermine the advertising efforts of their competitors. While click farms are the simplest way to execute click fraud, there are other more complex methods employed by sophisticated fraudsters. Some of the most common ones include: Crowdsourced Click Fraud: Have you ever visited a website that said something like “click these ads to support our website”? If so, you may have witnessed crowdsourced click fraud taking place. Here, the publishing website gets paid for each click on the ad, and the clicks come from genuine users. However, since the clicks are mostly done to ‘support the website’, they usually don’t have any sort of purchase intent behind them. This means the advertisers pay, and the fraudulent publishers get paid for useless clicks. Incentivised Traffic Click Fraud: In some cases, publishers offer some sort of reward to visitors or users in exchange for a click on an ad. The most common example of this can be observed in the case of smartphone games. Gaming apps incentivize users with in-game benefits in exchange for viewing or clicking on ads. Once again, the users clicking on these ads have absolutely no interest in the services or products they offer. Hence, these clicks have no value from the advertiser’s perspective, who still has to pay for them. Botnet Click Fraud: Botnets are large networks of computers infected with malware. The malware allows fraudsters to execute commands on these devices, which real users usually own. These commands, which often include visiting certain websites and clicking on ads (in other words, click fraud), are often executed without the knowledge of the owners of the devices. Hit Inflation Attacks: This is perhaps the most notorious form of click fraud. A hit inflation attack redirects users to a website they never intended to visit and clicks on the ads on that website. Before the user can do anything about this, they are redirected to the website they originally tried to visit. Now that we understand how click fraud works let us look at some obvious and some not-so-obvious ways it affects advertisers. The Impact of Click Fraud on Advertisers As you may be able to guess, click fraud impacts advertisers in multiple ways. For the sake of understanding, we have divided these into the following categories: Financial Implications Wasted ad spend is the most obvious impact of click fraud on advertisers. It is also perhaps the most serious. Wasted ad spend translates into a lower return on investment. In some instances, this may mean that the affected businesses may reduce their spending on digital advertising, or worse, they may completely put a stop to their digital advertising efforts. When this happens, the business ends up losing on two fronts. Besides losing their allocated ad spend to fraud, the company also ends up paying the opportunity cost of not continuing advertising on digital platforms. Distorted Performance Metrics A relatively less obvious impact of click fraud is the skewed ad campaign metrics it produces. Sources of click fraud often lead to an inflated click-through rate. In some cases, the biggest individual sources of ad traffic turn out to be the sources of fraudulent traffic. In such cases, the advertisers responsible for optimizing the campaign may allocate more budget to these sources of inflated traffic that are sending fraudulent traffic to their website. This may also mean that advertisers may ignore perfectly valid traffic sources that may send fewer but highly relevant prospects to their websites. Damaged Reputation and Trust Click fraud doesn’t just affect brands and advertising platforms. It also involves and impacts real users. In most cases of click fraud, genuine users are subjected to bad user experiences. When such experiences occur during their interactions with a brand, it may impact the brand’s image in the user’s mind. Click fraud also impacts the trust between advertisers and advertising platforms. Even ad platforms that may be actively trying to

Every click and impression counts! The dynamic landscape of digital advertising requires advertisers to maintain the integrity of ad campaigns. It might seem an uphill battle to optimize performance and safeguard the ad spend but proactive monitoring and fortifying their ad campaigns can protect them from menace like click fraud and spamming threats. The burning question here is – are these efforts enough? Do they protect against ever-evolving sophisticated threats? Is it building trust and transparency along with preventing wastage of ad spending? Let’s explore! Click Integrity Monitoring to Reducing Spamming and Click Fraud Consider the scenario – You’re running a digital ad campaign targeting users in India. But, you notice a surge in clicks that seem too good to be true. If you have an efficient click validation mechanism in place, you will uncover the sinister truth – click spamming is at play. Imagine the horror – if you don’t have such capability! The deceptive practice of generating invalid clicks on ads with malicious intent and you were making payout for these invalid clicks and impressions. Fig. 01: Checks via Click Integrity Click fraud poses a significant threat to advertisers worldwide from India to Southeast Asia (SEA) and the United States, no corner of the digital landscape is immune to this menace. Advertisers need to fortify their defenses and prevent the wastage of advertising budget. An active ad fraud detection that monitors clicks and impression integrity enables you to mitigate fraudulent clicks, safeguarding your brand’s reputation and preserving your ad budget. Building Trust Through Transparency to Prevent Click Fraud Trust is the currency that fuels success. Advertisers seek transparency and accountability from their partners. The goal is clear – They need optimal results from their advertising efforts and enhanced ROI on ad spend. Consider a scenario –  you’re a brand operating in the competitive landscape of the United States, where click fraud and spamming tactics run rampant. Your ad campaign is gaining traction, but you suspect foul play behind the scenes as invalid clicks are ruining your ad campaign performance metrics. Monitoring your click integrity empowers advertisers to thrive in such scenarios. Brands need a multi-level, defense mechanism across the funnel to meticulously track and validate ad impressions and clicks. Case Study: Major EdTech Player in India Analysis period in February 2023 started running a performance campaign to acquire new customers monitored by mFilterIt ad traffic validation solution. They were able to identify fake clicks and safeguarded their budget from heavy payouts. Fig. 02: Fraud detection and analysis with click & impression integrity for an EdTech player. The brand saved a massive amount of ad spend over 3 Months. For this EdTech company, the major issue was Fake Attribution (52.45%), The affiliates attributed installs by generating fake clicks after the user installed the app. The install was organic but due to the fake click, the install was attributed to the affiliate so that the affiliate could gain monetary benefits from the brand. Cases like these illustrate that the problem is beyond click spamming. Fake or invalid clicks are one part of the fraudulent activities that adversely impact the efficiency of ad campaigns. To fortify their ad campaign performance, they must optimize every aspect across the funnel with multi-level defense. Fig. 03: Impact of Click Fraud The Way Forward Monitor Your Click Integrity for a Brighter Future! Maintaining click integrity is non-negotiable. It’s the cornerstone of trust and transparency in the digital advertising ecosystem. What’s the moral of the story? So, dear advertisers, safeguard your brand’s reputation, optimize campaign performance and combat click fraud to reduce spamming. Start a new era of trust and build transparency in the digital ecosystem. Don’t waste your precious resources. Instead, focus your efforts on maximizing the impact while ensuring click integrity to steer your ad campaign strategically. Get in Touch to learn more about Click Fraud detection and prevention.