In an attempt to fight back against an ad fraud industry that cost companies $7.2 billion in 2016, a consortium of major ad tech players are working toward greater ad buying transparency by forming a new open-source initiative.
Long hailed as a paradigm-shifting innovation in marketing, programmatic ad buying’s exciting potential keeps getting overshadowed by serious performance problems, problems that have contributed significantly to the industry’s recent slowdown.
From brand safety concerns to opaque conversion attributions, the digital marketing landscape has made it uniquely challenging to align ad buys with the actual media preferences and behaviors of target audiences. Foremost among these issues is ad fraud.
The Devastating Effects of Digital Ad Fraud
According to research conducted by the Association of National Advertisers (ANA) and White Ops, bot traffic — that is, non-human traffic designed to imitate authentic internet users — reached an all-time high in 2016. Among the 49 companies that participated in the ANA study, the minimum annual loss attributable directly to bot fraud was $250,000, while the average annual loss was $10 million, boosted significantly by outliers who lost as much as $42 million.
The ANA estimates that, in total, bot fraud accounted for $7.2 billion of waste in 2016, a substantial increase from the $6.3 billion figure from the previous year. Depending on the circumstances, bots accounted for anywhere from 3% to 37% of ad impressions registered in 2016, another a troubling inflation of the 2% to 22% range from 2015.
An Open-Source Solution to Ad Buying’s Transparency Problem
Achieving the kind of transparency Amram is calling for might be easier said than done, but a group of ad tech companies that includes the likes of AppNexus, Facebook, PubMatic, and the Rubicon Project has announced a forthcoming open-source initiative that represents a promising first step.
Conceived as a solution to the lack of transparency in programmatic media buying, the initiative is particularly concerned with ameliorating the mysteriousness of blackbox ad auctions. By contributing to, editing, and regulating the code underlying programmatic auctions, the consortium hopes to clarify how a party wins an auction, who’s profiting from it, and how bad actors are being penalized for engaging in fraudulent practices.
The initiative also aims to broaden advertisers’ access to critical ad performance metrics like viewability and deliverability. That objective is of particular interest to the initiative’s founders, many of whom have been accused of turning a blind eye to fraud for the sake of their own bottom lines. With this new initiative, both ad providers and third-party ad buying agencies can point to the open-source platform as proof of their upstanding business practices.
Leveraging Artificial Intelligence to Outwit Fraudsters
While this open-source initiative certainly has the potential to put a big dent in ad fraud, it is hardly a comprehensive solution to what ails digital ad buying. Eliminating fraud will require not only greater transparency on the part of ad vendors and intermediary parties, but also effective tracking and blacklisting by advertisers themselves, an effort in which a platform like Albert™, the world’s first fully-automated AI marketing tool, will be incredibly helpful.
Unlike other marketing platforms, Albert employs machine learning technology to automatically assess the performance of every ad he purchases, guaranteeing that poorly performing ads don’t cripple your company’s advertising operations. By quickly detecting fraudulent traffic and automatically pulling investment from its source, the platform is able to keep the damage to your ad budget at an absolute minimum.
Viewing the type, placement, and effectiveness of every ad your company is running is not a luxury afforded by traditional ad buying agencies, but with Albert, marketing teams have access to real-time updates about even the most speculative micro-campaigns currently being tested. AI cannot eliminate ad fraud on its own, which is why the open-source initiative is such a welcome endeavor. But what it can do is give companies the peace of mind that their marketing budgets are not being squandered on views from bots.
As long as all parties remain committed to rooting out fraudulent practices at every step of the ad buying process, we may yet see digital advertising — programmatic and otherwise — fulfill its tremendous promise.
This article first appeared in www.albert.ai
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