Ad Industry Fraud Is Big Business: Why?

Ad industry fraud is big business. Some estimates claim that half of all online traffic is actually bots. That would mean that nearly $6 billion in online advertising each year gets flushed down the drain with no benefit to the advertising brand. Where did things go wrong?

Fake websites and bots abound, making it possible for just about any site to supply the KPI they need in order to attract advertisers. Of course, when KPIs are inflated, advertising doesn’t provide the anticipated revenue or return on investment (ROI). The problem is that the entire business of ad marketing has design flaws that make it easy to con buyers and sellers alike out of funds.

The key to avoiding ad fraud is to know the methods being used. Here are a few to watch for.

A Pixel Scam is when an ad is placed into a 1 by 1 pixel location. Clicks still go through, but no one ever sees the ad. It’s just set to register when someone clicks on a different pic, banner, or video.

Cookie Stuffing is a method fraudsters have developed to make shoppers appear to have come through a certain site, even though the customer found the retail site in another manner. As a result, the commission goes to the wrong company.

Pay-to-Click often uses real people who are paid to click on ads that trigger cost to an advertiser. Since the humans are usually very poor, they are happy to click links all day long for next to nothing. Of course, the scammers collect a much greater sum on the clicks, which will never result in any conversions.

Those are just a few examples of how bot operators, owners of fraud websites, and other con artists make money from online ad fraud. Clearly, ad industry fraud is big business, partly because technology has moved so fast.