I’ve seen different reports and read many different numbers, but if the stats are to be believed, then somewhere around 30%-60% of all ad impressions served are either fraudulent or never seen. This sounds ridiculously high, but within that range is a lot of ad spend.
Truth #1 on this topic is, most agencies don’t care too much because they buy the inventory so cheap and try to cover the fraud through optimization, squeaking by and achieving the client’s metrics. The cost of implementing fraud monitoring and viewability standards has to be calculated to outweigh the premium agencies would be forced to pay for the media. That’s a tough pill to swallow for most agencies: a fear of the unknown. They don’t know if they can make the numbers work.
Truth #2 - Fraud is about more than just wasted money -- it can be damaging for a brand. Fraud comes in many shapes and sizes. It can apply to paying for unviewable impressions and ads that never show up, but it can also apply to impressions that are displayed in a non-transparent environment through an exchange when you have no idea where the ads are actually shown. If you’re not using third-party data from a reputable source, and if you’re not looking at tools and services to verify delivery, you risk your brand’s being shown on a site where you don’t want it to be displayed. What if your brand is shown alongside inappropriate content, or simply news content that’s not favorable? Without transparency on the locations being bought, you have no recourse -- and no ability to protect your brand.
Truth #3 – This one may surprise you: While fraud is clearly a large issue, it’s not something that would be hard to fix. The industry wants to fix it. The agencies can be pressured to focus and fix it. The brands speak to how they would like to fix it. The challenge is aligning everyone to agree to terms and stop bickering about it.
One of the main industry organizations could take the lead on uniting the other industry orgs, and with executive sponsorship from the top-five publishers and the top-five holding companies, this could get resolved quickly. The majority of the ad spend is pushed through those companies. Since they control the lion’s share of the dollars, they could impose self-regulatory policies that everyone else would likely have to adopt.
The top 100 publishers and top 100 advertisers, as a whole, could literally eradicate the fraud issue in a matter of months if they would get on the same page. The result would be higher premiums to be paid for verified inventory, and agencies would likely have to focus on the creative product a little more. But as a whole, I would expect the quality of online advertising to increase dramatically.
The undercurrent of fraud is damaging to the entire industry. As the larger media industry continues its shift towards digital -- and with TV looking to adopt more and more of our policies and process -- this feels like the right time to get this problem solved.
Am I missing anything? Is there another challenge to the fraud issue?