Advertisers expected to lose $7.2B in 2016 due to fraud

No change in fraud levels, but with spending up, losses will climb says ANA

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A study from the Association of National Advertisers (ANA) and advertising security firm White Ops, says that an increase in spending will lead to a direct increase in losses due to ad fraud.

The losses are expected to reach $7.2B by year-end.

Forty-nine ANA members participated in the study, which measured bot activity by using detection tags placed on digital advertising by White Ops. Over 61 days (August-September, 2015), and 1,300 campaigns, White Ops was able to measure nearly 10 billion online advertising impressions.

What they found was that advertisers had a range of bot percentages varying from three to thirty-seven percent (an increase when compared to 2014).

But overall, the average rates of fraud remained unchanged for the most part. In all, less than a third of the participants experienced a decrease in bot traffic year-over-year.

The most vulnerable ads were media with a higher CPM (cost per thousand impressions). Those segments were hit the hardest, White Ops says, because there is more economic incentive for botnet operators.

For example, display media, provided the CPM was more than $10, had nearly 40-percent more bot traffic than media with a lower CPM.

The same can be said with video media as well. If the CPM was more then $15, video media had 173-percent more bot traffic during the tracking period.

Another highlight from the study centers on programmatic display ads. According to White Ops, programmatic display ads had 14-percent and programmatic video ads had 73-percent more bots than the study average.

Moreover, if a campaign targeted a given demographic, it typically resulted in more bots. For example, programmatic buys with Hispanic targeting were nearly twice as likely to encounter bot traffic as non-Hispanic targeted media.

A copy of the report can be obtained here (registration required, report is emailed).

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