Ad fraud is on the rise and according to a recent study by Click Mob, Malaysia is among the top five countries most targeted by ad fraud on mobile.
It’s an issue that has advertisers concerned and rightly so as by 2050 it will likely cost the industry US$50 billion as recently cited in a set of guidelines by the The World Federation of Advertisers (WFA). The WFA released their first guidelines to “assist marketers in taking practical steps to ensure that as little as possible of their advertising budget falls victim to ad fraud.”
A+M spoke with Ravi Shankar, group head of digital marketing at AirAsia on this issue and about how the industry can start to combat ad fraud and its impact on the Malaysian market. Shankar will share more on ad fraud and insights and case studies on tackling it at Digital Marketing Malaysia 2017 on 3-4 May at the Aloft Kuala Lumpur. Reserve your place today here.
A+M: What is the current state of ad fraud industry?
Shankar: If we are looking at the region, more brands are moving their budgets to digital and programmatic buying. Also, publishers in this region are not as sophisticated as the fraudsters and are not investing heavily in cyber security.
This will make the region and especially Malaysia with a strong internet penetration rate, a lucrative target in the future as well. Ad fraud is scalable and the profit margins are as high as 99%. Marketers who are planning to invest heavily in programmatic display campaigns should be concerned about this trend and should really spend time on the quality of the traffic and inventory they are buying in.
A+M: How is it impacting the Malaysian market in particular?
Shankar: I don’t think enough advertisers are aware of the impact and reach of ad fraud in Malaysia. Malaysia is one of the top countries affected because Malaysia is the country with 65% smart phone ownership and almost 70% internet penetration. Although both statistics are better in Singapore, the number of mobile users in Malaysia is significantly high compared with the whole of South East Asia. These numbers make Malaysia a luring target for fraudsters, fraud follows traffic.
A+M: What is the most common myth surrounding ad fraud?
Shankar: Advertisers and marketers think that video ads are less susceptible to ad fraud but it’s quite the other way around, with CPM (cost per thousand impressions) being very high for video, video inventory is more at risk than display banner ads inventory. Last year’s MethBot Russian-based ring managed to siphon between 3 and 5 million dollars a day by spoofing advertisers who thought they were buying premium ad slots.
This proves, yet again, that where there is a lot of traffic and money, there will be ad fraud. It’s important to remember that no specific piece of inventory is safe from ad fraud. Another common myth is that most advertisers think viewability and ad fraud are the same, but they are not, a fraudulent impression is an ad impression that a human never could have seen, even the circumstances are different but a non-viewable impression is an impression that the user never saw because of site construction and user behaviour.
A+M: Are third party filters reliable enough to determine an ad’s viewability?
Shankar: We have very sophisticated partners who can help us in detecting ad fraud, finding us viewable impressions and protecting our brand. I would suggest brands to use these partners if they can afford an additional CPM on top of the actual media cost as advertisers or marketers are not equipped with technology that determines the viewability of an impression before buying. We can prevent this in future campaigns by manually blacklisting the sites with low viewability and investing more in the websites that give us better viewability.
A+M: Are volume-based and pay-per-click models still the right approach for advertising? What attribution models should marketers be focusing on now?
Shanker: The industry should move away from volume based metrics/KPIs such as impressions, clicks and video views and should be focusing more on value based metrics/KPIs like sales, leads or conversion rate. If the advertiser is focused on branding they should track the micro conversions on their web assets like scrolling the content, time spent on the page, downloading a file and many more, only highly sophisticated bots can perform these actions, so we can be sure that we are getting quality traffic to our web assets.
Attribution models are something that depends on the business model. If we are confident that at least 70% of the traffic coming from our display campaigns is human traffic we can move from a click/visit based attribution model to an impression based attribution model which gives some weightage to branding channels.
A+M: What are the steps to building a digital marketing team that is as resilient as possible to ad fraud?
Shankar: We need to educate them about the seriousness of ad fraud and train to identify the potential areas of ad fraud making sure they are taking all the necessary steps to protect the brand. The team should be trained to have the right KPI conversations with the agencies and look at the right metrics to determine the success of digital campaigns. Also, the team should be trained on all the most relevant ad fraud protection tools, looking at the traffic trends in web analytics dashboards to identify the ad fraud activity. Agencies should use third party verification vendors like Integral Ad Science, DoubleVerify, Pixalate to detect fraudulent activity.
A+M: As tracking tools become more sophisticated and marketers become more aware will we see the decline of ad fraud or will it continue to adapt and rise?
Shankar: Creating awareness and using sophisticated tools will not make any difference. Brands must ask the fundamental question “what is the motivation for my agency or publisher to fight ad fraud” and take necessary actions to make sure they care about the advertising dollars. If you are still paying your ad tech partners based on the % of media spend, I don’t think any party that benefits on volume will take steps to fight fraud and reduce their revenue. The ad fraud will see a decline if all the parties on the buy side and sell side come together.
A+M: What are some low-tech ways marketers can start to deduce if they have been the victims of ad fraud?
Shankar: Some ways of detecting ad fraud manually are looking at web analytics data and dig deeper into sudden traffic bumps and for display campaigns always look at individual website level or app level data and dig deeper if they have abnormal CTR the any website or app that is giving more than 1% CTR is a suspect (provided we have enough impressions)
A+M: What do you see as the future of the ad fraud industry in 2017 and beyond, how will marketers evolve to outsmart it?
Shankar: If brands, agencies and ad tech providers don’t come together and combat ad fraud, there will not be a lot of change in situation. It will always be a cat and mouse game and fraudsters will continue to find ways to exploit and ad fraud tech will continue to counter protect.
To learn more on techniques for managing ad fraud and the future of digital marketing join Shankar and other digital experts at Digital Marketing Malaysia 2017 on 3-4 May. For more details please contact: Nirah Aziz, on +65 8157 3449/ +65 6423 0329 or at email@example.com