Confessions of an ad tech veteran on fraud: 'Advertisers need to react to what’s happening'

Advertisers will lose $6.3 billion globally to bots in 2015, according to the Association of National Advertisers and security firm White Op’s “Fraud in Digital Advertising” study. Cracking it is a top priority for everyone.

Or at least it should be.

In the latest installment of Digiday’s Confessions series, in which we trade honesty for anonymity, we spoke to a media and advertising veteran, who has worked on the publisher, agency and network side on what’s holding it back.

Excerpts lightly edited.

What frustrates you about the state of ad fraud?
I was recently in front of about 400 advertisers talking to them about fraud, and they all nodded their heads and listened, but there was apathy. Behind the scenes I ask them what they’re doing about it and some of them shrug their shoulders. But they should care more than anybody. Before I thought it was an education issue — that there was a veil of deceit being pulled over their eyes — but it turns out many of them knew.

Nobody’s doing anything?
Some of them are beginning to apply more pressure, like AIG in the U.S. And there does seem to be a move towards having strict terms within contracts that either have compensation or pay for proven viewability impressions. AppNexus has launched its Certified Supply Program for example. But the fact remains not all of them are. Advertisers need to react more to what’s happening.

Is there apathy because the fraud is factored into the cost?
They’ll say 50 percent of our marketing isn’t working anyway, therefore we’re used to that and still get good performance. If it works and looks like it’s performing everyone pats themselves on the back. The funniest conversation I’ve ever had with an agency was when I told them a campaign they had run was 90 percent fraudulent, and their reply was: ‘Oh, I know, but it really performed well. The click-through rates were phenomenal.’ I re-emphasized that those click-throughs were fraudulent; the ads weren’t seen by humans, and their response was ‘The client is happy. We’re renewing the contract.’

The trade associations have been tackling this though.
Yes, but with no teeth. People can sign up to the Digital Trading Standards Group (DTSG) for example, without being audited. Of course you’re going to sign up to it, some of the worst behaving networks will sign up for it, but if you’re not tested it means nothing. Exchanges are the ones probably trading the highest amount of fraud, and yet they aren’t being monitored. Signing up to the DTSG and saying you’re a member means diddly squat.

What about the audit process?
No one has been caught, no one suspended. You have to show you’re going to follow through.

So what are the repercussions?
There aren’t any. The idea is that you can put in place procedures, content-verification and fraud-prevention tools, but they can just switch it on when the auditors come in.

You know that for sure?
I know there is no single client using those tools across the whole of their inventory. Fair enough they will use them for certain sites or audiences they are nervous about. But to a large extent people are using it in bursts. It would cost them tens of thousands to do it across everything. No one is willing to pay it.

Why do some just turn the other way, because everyone else does?
We’ve always said our industry is 100 percent accountable. Far from it. Many attribution models are flawed. The tech doesn’t completely tell you it’s the right person you’re targeting, and the fraudsters can look like the right person, and that is totally skewing the results. Some companies may well tell me I’m wrong and that their tech can do that, but I’m not convinced. There is a fine line between agencies deceiving advertisers and protecting them.

Can you elaborate. 
If the agency tells the advertisers of the scale of fraud this will make a huge impact on the confidence in spend in the market. So there is a bit of protecting going on, but some are deceiving them because they don’t want them to then ask what has been going on for the last five years.

What about the publisher side?
Publishers are taking it seriously but are those that buy third-party audience extensions all vetting them? No. Are they doing sample checks? Yes, occasionally. I love being able to say this openly at last, it’s like therapy.