Economic losses due to bot fraud are expected to total $5.8 billion
globally this year, but for the first time ever more fraud will be
stopped in 2019 than will succeed, according to the fourth Bot Baseline
report from White Ops and the ANA (Association of National Advertisers).
The monetary losses, while significant, are an improvement over the $6.5
billion reported in the previous study released in 2017. The 11 percent
decline in two years is particularly noteworthy considering that digital
ad spending increased by 25.4 percent between 2017 and 2019.
“We are coming off a year of unprecedented industry collaboration that
has proved to be a powerful tool for tackling ad fraud at a global
scale,” said Tamer Hassan, CEO and Co-founder at White Ops. “But it is
important to remember that fraud will always follow the money. As
spending moves into new ad frontiers like CTV, it is increasingly
important for marketers to stay vigilant and to recognize that fraud is
a cybersecurity problem, not merely a measurement challenge and cannot
be handled as such.”
The study revealed that while fraud attempts amount to 20-35
percent of all ad impressions throughout the year, the amount of fraud
that gets through and gets paid for is now much smaller. For the first
time, the majority of those fraudulent impressions are now
getting invalidated by demand-side platforms (DSPs) or supply-side
platforms (SSPs), filtered as SIVT before being paid for, or invalidated
later via claw backs (the recovery of ad spend after a campaign has
run). Absent of these measures, fraud losses would have grown to an
estimated $14 billion annually, the report said.
When broken down by category, the report showed that eight percent of
display advertising impressions are fraudulent (down from nine percent
in 2017) while 14 percent of video ads are fake (down from 22 percent).
Key findings in the 2019 Bot Baseline Report were presented today at the
ANA’s annual Advertising Financial Management Conference.
“The decrease in ad fraud suggests that the war on fraud is winnable,”
said ANA CEO Bob Liodice. “Less fraud means more resources can be
devoted to brand and business building.”
Key findings, and factors that contributed to decline in ad fraud
Ads.txt, which was created by the IAB Tech Lab to help publishers
create lists of authorized media sellers, has worked to reduce desktop
spoofing. The rates for desktop ad fraud were the lowest in the
history of the report.
It has become more expensive and less efficient to buy sophisticated,
realistic bot traffic. Many bot traffic vendors have been driven out
of business or underground, reducing the availability of bot traffic
sold at “retail” on the open web to anyone with a credit card. Efforts
by the Trustworthy Accountability Group (TAG) and their Certified
Against Fraud program, coupled with groups working together to
dismantle botnets, have drastically reduced both the supply and the
demand for traffic from vendors that are caught selling bot traffic.
Today, more sophisticated bot buying operations have been forced
underground, to invitation-only forums and chat rooms, which require a
more sophisticated buyer.
More programmatic dollars are transacted through platforms with
built-in fraud prevention measures. Advertisers are directing more of
their money through buying channels with dedicated, independent fraud
prevention measures, an option that wasn’t available at the time of
the original study in 2014. Today, there are third-party security
firms treating fraud-fighting as a dedicated function. When security
is separated from audience and media intelligence, collaboration
across platforms becomes substantially easier to scale. These measures
help marketers avoid bidding on invalid traffic by default, without
The study recommended that marketers take the following steps to help
reduce ad fraud:
Work with the buy-side platforms who are building in fraud detection,
requiring ads.txt, and pushing the adoption of new protections like
Work with the sell-side platforms who are helping everyone, including
the long-tail publishers that make the web so great, to adopt
protections like ads.txt and transparency-supporting standards like
Reject the temptation of buying “for tonnage,” i.e., space on
high-risk and less valuable placements, which are filled with
undisclosed incentivized inventory and adware.
Push for the right to hold every platform, ad format, and buying
channel to the same high standard of independent validatability.
Fifty ANA member companies participated in this year’s study. White Ops
worked with brand advertisers and their agencies to analyze digital
advertising activity data between August 1, 2018 and September 30, 2018.
ABOUT THE ANA
The ANA (Association of National Advertisers) makes a difference for
individuals, brands, and the industry by driving growth, advancing the
interests of marketers, and promoting and protecting the well-being of
the marketing community. Founded in 1910, the ANA provides leadership
that advances marketing excellence and shapes the future of the
industry. The ANA’s membership includes more than 1,850 companies and
organizations with 20,000 brands that engage almost 100,000 industry
professionals and collectively spend or support more than $400 billion
in marketing and advertising annually. The membership is comprised of
more than 1,100 client-side marketers and more than 750 marketing
solutions provider members, which include leading marketing data science
and technology suppliers, ad agencies, law firms, consultants, and
vendors. Further enriching the ecosystem is the work of the nonprofit
ANA Educational Foundation (AEF), which has the mission of enhancing the
understanding of advertising and marketing within the academic and
ABOUT WHITE OPS
White Ops is a cybersecurity company that protects the Internet from
malicious bot activity. Globally, software-as-a-service from White Ops
determines the validity of nearly 100 billion transactions per day on
behalf of over 200 customers. Our proactive adaptation, Internet-scale,
and multi-layered methodology have made us the platform of choice for
some of the largest and most forward-thinking platforms and brands. For
more information, visit www.whiteops.com.