• by Karlene Lukovitz  @KLmarketdaily, April 25, 2023

The not-so-good news: Connected TV (CTV) ad fraud cost advertisers about $144 million in 2021.

But hey — that pales in comparison to the estimated $23 billion lost last year to ad fraud in other digital advertising.

While this lesser-of-two evils argument seems unlikely to make CTV advertisers break out the bubbly, the Video Advertising Bureau (VAB) apparently thinks that it will work to CTV’s benefit.

VAB’s just-released report, “The Truth About CTV Ad Fraud,” is well-intentioned. But some of its attempts to put the problem in context come off as... well, a bit lame. 

The report starts by defining “true” advertising fraud as device-driven fraud (use of computers, servers, phones and other devices by cybercriminals to counterfeit ad impressions by impersonating real users) and content-driven fraud (creating fakes sites and apps with fraudulent inventory and selling it to advertisers who believe their ads are showing up on real premium sites). Fair enough.

But it also makes a big point of stating that “normal viewer behaviors, like falling asleep while watching TV or turning the TV set off without shutting down an app, is not fraud.”

While it’s true that neither of those constitutes intentional fraud, it is disingenuous at best to lump the “TV off” syndrome in with viewers falling asleep.

TV off is a known industry technical/reporting problem that, according to a GroupM/iSpot.tv study, means that 8% to 10% of the CTV impressions being paid for by advertisers actually have zero chance of having been seen by consumers. That’s why GroupM and media companies are trying to create new standards for measuring and verifying the "viewability" of ads in streaming and CTV environments.

So it’s odd indeed that while the VAB report mentions the TV off study, it doesn’t mention those 8% to 10% of impressions being delivered to dark screens. And it’s even odder that it attempts to make it sound like this is something perpetrated by careless consumers.

Really, what’s the argument here? “If only those pesky viewers would remember to turn off their apps, we could monitor their behavior more accurately and charge advertisers accordingly”? Well gee, maybe TV operators should be posting “Mind the app” messaging as screen savers, to remind viewers of their duty to assist the advertising industry. For that matter, why not require viewers to attach electrodes directly to their heads so we can tell when they fall asleep — and better yet, deliver small electrical jolts to keep them awake?

Another "we're not as bad as they are" truth cited about CTV: Unlike other digital ad environments, ad fraud on CTV “normally” doesn’t impact the viewer experience or leave the user open to malware.

Well, maybe I’m being a bit harsh here. While it doesn’t offer any silver-bullet, industrywide solutions for ad fraud (now that would be news), it does make some valid points, along with providing useful advice for advertisers who still don’t understand that they need to guard against real fraud on CTV (and elsewhere).

For instance, the report notes that there are limited opportunities for advertising fraud within premium, professionally produced TV content, with fraud in CTV mostly occurring through “low-quality” programmatic buys and relatively little occurring in publisher-direct and “premium” programmatic buys.

Also: That estimated CTV ad-fraud dollar losses represent just 0.3% to 0.4% of total U.S. TV ad spend, and 1.2% to 1.4% of total U.S. CTV ad spend. (U.S. TV spend was $87.3 billion last year, including CTV’s $20.7 billion, according to eMarketer Insider Intelligence.) In comparison, ad fraud represented an estimated 10.3% of total digital ad spend, per a VAB analysis of eMarketer data.

The report notes that 2021 YouGov research found consumers are 1.5 times more likely to trust TV ads as a whole (presumably including CTV) than ads on web sites. Also, a 2023 Integral Ad Science survey found a relatively small 15% of marketers saying that they think CTV will be most vulnerable to ad fraud in the next 12 months, compared to 39% for in-feed social media, 22% for mobile web video, 19% for mobile web display and 18% each for search, mobile in-app video and desktop display.

And most important, the summary of the best available advice on minimizing ad fraud on CTV: Learn about ad verification, ad blocking technology and other tools that can identify and block fraudulent traffic; use trusted vendors in purchasing ad inventory; and work with vetted measurement and data companies that specialize in audience and ad verification and invalid traffic detection to ensure that ads are being seen by real viewers.

(Except when those thoughtless viewers fall asleep or neglect to turn off their apps, of course.)

The report download is free to members or by registration.