Experience TV episode 11: Overcoming the threat of digital ad fraud featuring Mike Zaneis and Sam Mansour

Welcome to Experience TV, a LIVE show on social channels about the economic revolution we’re living through—the Experience Economy—where brands compete on the quality of their customer experiences.

Here you’ll find the replay of each episode and all resources mentioned within. Follow me, Katie Martell—on Twitter, LinkedIn, or the show’s Facebook page—to catch future episodes.

Episode 11 discussed ad fraud, a threat facing all digital marketers, featuring insights from Mike Zaneis, CEO of the Trustworthy Accountability Group, and Sam Mansour, Principal Product Manager at Oracle.

Watch below, and read on for a full recap.

2021 is a record-setting year for advertisers

WPP’s GroupM forecasts that advertisers will spend a record $651 billion this year, up 10% over last year’s COVID slump. That number is forecasted to be $237 billion, up 3% over last year in the US.

For some context, if your marketing team spent $1 every second, it would take 31 years to reach $1 billion in spend.

Much of this growth is being powered by digital channels, as nearly $400 billion will be spent in digital advertising this year, far more than the nearly $150 billion forecasted for TV ad spending, with the remainder of budgets split between cinema, outdoor, magazine, audio, and newspaper advertising.

More ads, more fraud

The rise of digital advertising brings an increasing risk of ad fraud, which is defined as the attempt to scam digital advertising networks for financial gain.

Multiple reports estimate that ad fraud is stealing 20% of that global ad spending, representing billions of dollars wasted. As marketers, we want our digital ad campaigns to have volume and reach; but who are we reaching? Are we confident our ads appear in the right places, to the right audiences, and to humans?

Ad fraud is a growing and consistent problem that’s ballooned in scope with the proliferation of content, devices, and channels. Whether on mobile, web, or connected TVs, content publishers have more avenues to reach audiences with ads—and more ads mean more scams and schemes.

High-profile brands caught in ad fraud scams

The head of performance marketing and CRM at Uber shared early last year that the company turned off two-thirds of its digital ad spend, totaling over $100 million, seeing no change in user acquisition. Uber was a victim of attribution fraud, where ad networks take credit for installs that would’ve happened organically.

And in 2017, consumer banking company Chase reduced their programmatic reach and cut the number of sites it advertised on from 400,000 to 5,000, a decrease of 90%. According to their chief marketing officer, the company saw no change in their cost per impressions (CMPs) or ad visibility.

P&G (once the world’s biggest advertiser) made headlines in 2018 by revealing that they were able to cut $200 million in digital ad spend while increasing their reach by 10%.

Marc Pritchard, P&G’s chief brand officer, is a longstanding vocal critic of digital advertising clutter, ad fraud, and is a champion of brand safety. At a 2017 speech to the Interactive Advertising Bureau’s Annual Leadership Meeting, he said,

“Sometimes we deliver a high- quality media experience, but all too often, the experience is, well, crappy. We bombard consumers with thousands of ads a day, subject them to endless ad load times, interrupt them with pop-ups and overpopulate their screens and feeds. And with ad blockers growing to 40% and fraud as high as 20%, who knows if they even see our ads.”

In that speech, he also called for a new media supply chain, advocating for content quality and for all the players of the ad tech, marketing, and publishing industries to work together to address this issue.

Interview with Mike Zaneis and Sam Mansour

To understand what the advertising industry is doing to fight ad fraud and help marketers protect their spending, Mike Zaneis, CEO of the Trustworthy Accountability Group (TAG) and Sam Mansour, principal product manager at Oracle, joined me for an interview.

Some conversation highlights include:

• Help is here. Mike explained TAG’s efforts to fight criminal activity in the digital advertising supply chain. The industry organization focuses on fighting fraud, such as ad-supported piracy or the distribution of malware. He also spearheads an educational effort, the Brand Safety Institute, to certify and educate individuals about brand safety issues such as ads appearing next to inappropriate content such as hate speech or misinformation.”If we can create a kind of army within the industry that are thinking about these issues on a daily basis and working to protect marketers, we’re going to be better off,” says Mike.

• The threat is expensive. Juniper Research forecasts that $100 billion will be lost to ad fraud by 2023. “As long as there’s money to be made, and the anonymity of the web to disguise it, there’s going to be ad fraud,” says Sam.

• Not all invalid traffic is ad fraud. Sam explains the difference between invalid traffic (which could be a malicious bot or simply a spider indexing web content for a search engine) and fraud is malicious intent. Read more on that in Sam’s blog post.

• Examples of ad fraud schemes. Sam mentioned that Oracle is processing 60 billion ad events daily, sometimes detecting bad actors and exposing several sophisticated ad fraud schemes. Some examples include:

  • Connected TV (CTV) fraud – one scheme known as StreamScan took advantage of the growth in next-gen TV, representing 40% of global internet users. Oracle exposed the largest CTV ad fraud operation ever in late 2020, which exploited flaws in CTV ad serving technology to fool advertisers into paying for ads that were never delivered to 28 million households.

  • HYDRA/TERRACOTTA – In an example of a collaborative effort to fight this threat, TAG brought together three different IVT (invalid traffic) solutions to focus on one threat: Android emulators impersonating thousands of real apps, creating 100 million fake impressions a day, and hurting advertisers’ campaigns.

  • DRAINERBOT – Among the first ad fraud operations to financially compromise consumers, DrainerBot infected consumers’ mobile apps using up to 10 gigabytes of data a month. The malicious bot drove up data charges on mobile devices, slowed the devices, and drained their batteries.

• The need for threat sharing capabilities. The HYDRA/TERRACOTTA scheme showed the benefit of a collaborative industry effort between Oracle Moat, TAG, Protected Media, and White Ops. Mike notes, “TAG has been working on trying to bring the industry together and having them understand the value of sharing intelligence. It’s new to our industry. When you look at mature industries like the financial services sector, they spend tens of billions of dollars a year on security and in threat sharing capabilities.”

What marketers can do

Tips from Mike and Sam to combat ad fraud include:

• Know your partners. Look for TAG certification.

• Set a policy around brand safety and how you plan to identify/filter fraud using partners. Include relevant language in your contracts with your agency or demand-side platform (DSP).

• Enforce your policies and demand accountability through the ad supply chain. For example, Mike shares that P&G will only buy with TAG-certified-against-fraud partners and enforces that as a standard. This has had no cost to reach, scale, or advertising impact.

• No measurement without brand safety. Sam notes that marketers don’t have accurate measurements unless we are filtering out ad fraud. It pollutes our data sets, the foundation upon which our measurement outcomes are built on. He recommends analyzing the data from your measurement provider and ensuring you’re reaching real people with your ad spend.

• Blocklists aren’t enough. Rob Tarkoff of Oracle said on a recent AdExchanger Talks podcast that marketers too often use the “blunt-instrument approach” of blocklisting.For example, at the start of the pandemic, many brands blocked ads from appearing next to any mention of COVID. Oracle’s research found that more than one-third of all COVID mentions appeared in a completely brand-safe context, hurting publishers and the journalism industry. Mike helped brands avoid this by partnering with a local media consortium in the US to create a local news inclusion list.

He also recommends tools that help clarify the full context of a page when identifying brand suitable content, noting that consumers can tell the difference between harmful content and legitimate news articles.

“Your potential customers are very sophisticated. You need to be as sophisticated as they are,” says Mike.

Learn more about the Brand Safety Institute and Trustworthy Accountability Group.

This content was originally published at SmarterCX by Oracle. It has been adapted for the Customer Experience Blog.