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State of NOT Ad Fraud Q2 2019

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I won't tell you ad fraud is at all time highs, both in dollars and in rate. The problem with industry-wide fraud estimates is that they are missing what is not known (new forms of fraud not detected yet). So this iteration of the State of Ad Fraud will change the perspective to what is known or knowable, through accurate measurement - because what is known can then be acted upon. Marketers big and small have started to solve ad fraud themselves, once they have the right data to look at and know what to look for.

Publié dans : Marketing
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State of NOT Ad Fraud Q2 2019

  1. 1. April 2019 / Page 0marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou State of Ad Fraud Q2 2019 April 30, 2019 Augustine Fou, PhD. acfou [at] mktsci.com 212. 203 .7239
  2. 2. April 2019 / Page 1marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou “I’ve been asked this a lot recently – ‘how big is ad fraud?’ I can’t say for the industry; I can only say for the client campaigns I’ve measured.”
  3. 3. April 2019 / Page 2marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Agenda 1. How big is ad fraud? 2. How much is NOT fraud (i.e. known)? 3. How marketers are solving fraud themselves
  4. 4. April 2019 / Page 3marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou How Big is Ad Fraud?
  5. 5. April 2019 / Page 4marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou “you tell me” (look at the evidence)
  6. 6. April 2019 / Page 5marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou New “largest ever” botnet every year Vast botnets targeting high-value video ads, disguising/hiding
  7. 7. April 2019 / Page 6marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Millions of apps on millions of phones Big companies openly committing fraud; in-app is far less measurable October 2018 https://www.buzzfeednews.com/ article/craigsilverman/how-a- massive-ad-fraud-scheme- exploited-android-phones-to November 2018 https://www.buzzfeednews.com/ article/craigsilverman/android- apps-cheetah-mobile-kika- kochava-ad-fraud March 2019 https://www.buzzfeednews.com/ article/craigsilverman/in-banner- video-ad-fraud April 2019 https://www.buzzfeednews.com/ article/craigsilverman/google- play-store-ad-fraud-du-group- baidu
  8. 8. April 2019 / Page 7marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Hundreds of billions of redirects Page redirects/pop-unders evade fraud detection easily a.k.a. “zero-click” “pop-under” “forced-view” “auto-nav” Source: https://www.buzzfeed.com/craigsilverman/remember-tom
  9. 9. April 2019 / Page 8marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou 100% fraud, 99% location fraud Big companies openly committing fraud; in-app is far less measurable https://blog.branch.io/mobile-ad-fraud- what-24-billion-clicks-on-700-ad-networks- reveal/ “Top 8 networks were 100% fraud and the top 34 were all greater than 50% fraud.” “90 – 99% of geolocation data is bad or outright faked.”
  10. 10. April 2019 / Page 9marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou 99% of ads were never served Hidden cost: marketers pay for bids won; ads served is less, sometimes by a lot, than what they paid for Campaign 1 • For every bid won, there should be an ad served – a 1:1 relationship • Comparing DSP data vs ad server data shows that for certain domains the discrepancy is large • Marketers pay on bids won; the discrepancy is the hidden cost of ads not being served Low CPM Campaign 2
  11. 11. April 2019 / Page 10marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Billions of fake users purged February 2018 http://www.adweek.com/digital/lotame- purges-its-data-exchange-after-identifying- 400-million-user-profiles-as-bots/ May 2018 https://www.inc.com/bill-murphy- jr/facebook-says-it-disabled-almost-13- billion-fake-accounts-and-numbers-only- get-more-insane-from-there.html July 2018 https://www.engadget.com/2018/07/06/t witter-reportedly-suspended-70-million- fake-accounts-in-may-and/
  12. 12. April 2019 / Page 11marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Luminati[.]io Oxylabs[.]io Smartproxy[.]com Millions of IPs to disguise bots Use: to disguise data center bots to appear to come from residential IP addresses, avoid detection 40 million IP addresses 10 million IP addresses 30 million IP addresses
  13. 13. April 2019 / Page 12marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou 700X more bad apps than good ones $46 Search Display/Video $46 $32$39 $8 Google Search FB+Google Display$29 (outside Google/Facebook) $100 Billion Digital SpendSource: IAB 2H 2018 Report Source: Verisign, Q4 2016 329M domains est. 1 million est. 164 million 7M apps Source: Statista, March 2017 est. 10,000 est. 6.99 million 1% of impressions 99% of impressions $10B $19B Good Publishers “sites/apps with ads”
  14. 14. April 2019 / Page 13marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Traffic sellers openly selling Many sources to buy “traffic,” tune “quality” level, host bots Google “buy real human traffic” Select vendor and “traffic quality level” Host your own bots (cost $3.99/mo)
  15. 15. April 2019 / Page 14marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Massive quantities sold by unknowns Highlighted domains and apps are interspersed with large sites that you know many humans go to. These are DAILY quantities of impressions. Notice the large quantities; some are larger than mainstream sites.
  16. 16. April 2019 / Page 15marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Missing media dollars, fraud? Comparing DSP logs vs invoices, unspent dollars go missing Display Campaign 1 $3,300,000 (+10%) (agency invoice to advertiser) $3,000,000 DSP invoice to agency (paid by advertiser) $1,800,000 (-40%) DSP log total (bids won) On average, 24% of advertisers’ media spend was wasted/missing Mobile Campaign 2 $950,000 (campaign spend) $330,000 (35%) (invalid devices/fraud) Display Campaign 3 $7,900,000 (campaign spend) $1,500,000 (19%) (invalid devices/fraud) Display Campaign 3 $3,900,000 (campaign spend) $550,000 (14%) (invalid devices/fraud) Display Campaign 4 $7,000,000 (campaign spend) $1,700,000 (24%) (invalid devices/fraud) Source: Method Media Intelligence DSP logs show only $1.8 million of bids won, compared to the $3.0 million paid; $1.2 million went “missing” (not returned/credited to advertiser)
  17. 17. April 2019 / Page 16marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Other forms of fraud, not IVT If you’re only looking for bots/IVT, you will find just bots 1.3% + 57% = 58% bots site/app fraud overall fraud bot detection sees this bot detection misses this
  18. 18. April 2019 / Page 17marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Fraud, waste eats most budgets $1 spent by Marketer blocked see slide 1 site/app fraud see slides 2-4 ad/user fraud see https://www.slideshare.net/augustinefou/presentations not viewable see slides 5-7 10% 30% 40% 20% • fake sites, spoofing • auto-reload/refresh • ad stacking • tag manipulation • redirect/sourced traffic • pop-ups/unders • naked/invisible ads • bots/fake users • fake devices • background load • fake apps • deviceID rotation • random deviceID • retargeting fraud • fake profiles/data • malware/adware • fake analytics • fake attribution • click injection • incentivized views • residential proxy • app is not in use • tab is not active • browser minimized • 50% ad in viewport • misrepresented • (1s display, 2s video) 10% 70% 20% blocked fraud useless productive digital ads for Marketer 1% ?
  19. 19. April 2019 / Page 18marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou 10 – 90 dollars 1 - 99 impressions unknown unknown
  20. 20. April 2019 / Page 19marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Fake botnet for PR purposes “used highly sophisticated techniques to fraudulently load ads on the affected sites without the site owners' consent, leveraging a new methodology that allows it to monetize inventory on premium domains.” “none of this actually happened; it was completely fabricated for the press release announcing their new algo – ‘dramatic improvements to its automated traffic detection .. primarily through …machine learning methodologies’. The failure was due to their analyzing only pre-bid data, which was faked. There were no ads injected into any of the sites they named in the press release. This was confirmed by each of the good publishers, falsely accused.”
  21. 21. April 2019 / Page 20marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Trade associations think… Ads fraud is virtually “non-existent” – IAB Australia “Ad fraud is $6.5 billion or 9% of display ad spend” -- Assoc. of Nat’l Advertisers “@tag_today says it has a ‘monumental’ breakthrough on a method that can cut online fraud by more than 83%”
  22. 22. April 2019 / Page 21marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou “the problem with an industry- wide extrapolation is … you don’t know what you don’t know.”
  23. 23. April 2019 / Page 22marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou “there are always new threats and exploits – called ‘zero- day’s in the cyber security. Better to focus on what is known or knowable.”
  24. 24. April 2019 / Page 23marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou What is NOT ad fraud? (i.e. known)
  25. 25. April 2019 / Page 24marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou 10 – 90 dollars 1 - 99 impressions known known “$10 billion out of $100 billion of digital spend in the U.S. is spent with good publishers.” DCN “1% of impressions can be confirmed to be shown to humans, and viewable”
  26. 26. April 2019 / Page 25marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Confirmed humans: in-ad, on-site IN-AD 3% confirmed humans (tag placed in display ads, in ad iframe; used to determine quality of sites and apps that loaded them) ON-SITE 82% confirmed humans (embed code placed directly on the page to determine quality of visitors arriving on the site)
  27. 27. April 2019 / Page 26marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Good publishers - magazines Directly measured on-site, 77% confirmed humans
  28. 28. April 2019 / Page 27marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Good publishers – local TV Directly measured on-site, 61% confirmed humans
  29. 29. April 2019 / Page 28marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Good publishers – local radio Directly measured on-site, 48% confirmed humans
  30. 30. April 2019 / Page 29marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Measured viewability: 3-17% Viewability must be measured in-ad, using intersectionObserver Exchange A, All CPMs exclude app app only blended hasFocus:1 4.2% 5% 0.5% 4.8% 4.7% 5% -hasFocus:1 84.7% 95% 10.6% 95.2% 95.3% 95% 88.9% 11.1% 100.0% visibilityState:visible 69.9% 79% 9.6% 86.1% 79.5% 80% -visibilityState:visible 19.0% 21% 1.5% 13.9% 20.5% 20% 88.9% 11.1% 100.0% intersection >50% 20.1% 23% 4.2% 37.4% 24.2% 24% -intersection >50% 68.8% 77% 7.0% 62.6% 75.8% 76% 88.9% 11.1% 100.0% viewable 0.8% 1.5% 0.9% (excl hasFocus:1) viewable 17.8% 32.2% 19.3% Exchange B, All CPMs exclude app app only blended hasFocus:1 0.4% 0% 0.0% 0.0% 0.4% 0% -hasFocus:1 95.1% 100% 4.5% 100.0% 99.7% 100% 95.5% 4.5% 100.0% visibilityState:visible 34.3% 36% 4.2% 92.2% 38.4% 38% -visibilityState:visible 61.2% 64% 0.4% 7.8% 61.6% 62% 95.5% 4.5% 100.0% intersection >50% 8.0% 8% 0.5% 10.9% 8.5% 9% -intersection >50% 87.5% 92% 4.0% 89.1% 91.5% 91% 95.5% 4.5% 100.0% viewable 0.0% 0.0% 0.0% (excl hasFocus:1) viewable 3.0% 10.0% 3.3%
  31. 31. April 2019 / Page 30marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Measured ad blocking: 10-18% Ad blocking must be measured on-site, mobile separated, no bots B2C (Consumer) Jan 2019 EXCLUDE BOTS RAW (percent of data) percent NOT Blocked Blocked mobile 61.8% 0.4% 0.7% blocking rate desktop 27.6% 3.1% 10.2% blocking rate not measured 4.8% 97.8% 2.2% bots B2B Jan 2019 EXCLUDE BOTS RAW (percent of data) percent NOT Blocked Blocked mobile 34.5% 0.5% 1.3% blocking rate desktop 39.9% 9.0% 18.5% blocking rate not measured 7.9% 91.8% 8.2% bots
  32. 32. April 2019 / Page 31marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Known: -99% reach, no impact “JPMorgan had already decided last year to oversee its own programmatic buying operation. Advertisements for JPMorgan Chase were appearing on about 400,000 websites a month. [But] only 12,000, or 3 percent, led to activity beyond an impression. [Then, Chase] limited its display ads to about 5,000 websites. We haven’t seen any deterioration on our performance metrics,” Ms. Lemkau said.” “99% reduction in ‘reach’ … Same Results.” Source: NYTimes, March 29, 2017 (because it wasn’t real, human reach)
  33. 33. April 2019 / Page 32marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Known: -$200M, no impact “Once we got transparency, it illuminated what reality was,” said Mr. Pritchard. P&G then took matters into its owns hands and voted with its dollars, he said.” “As we all chased the Holy Grail of digital, self-included, we were relinquishing too much control— blinded by shiny objects, overwhelmed by big data, and ceding power to algorithms,” Mr. Pritchard said. Source: WSJ, March 2018
  34. 34. April 2019 / Page 33marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Case Examples of Marketers Solving Fraud THEMSELVES
  35. 35. April 2019 / Page 34marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Small businesses found/killed fraud “Both of these small businesses used their own analytics and gut instinct; they resolved ad fraud without using any expensive tech.” Small Business A • Noticed a 118,600% increase in Android devices hitting her site during campaign – AND no additional goal completions • Compiled additional data that corroborated it was fraud; presented to ad network and got refund for entire campaign Small Business B • Year over year, marketer noticed the discrepancy between counts reported by ad network versus his own Google Analytics shot up dramatically (even though cost-per-action remained similar). • Conversions also dropped dramatically. With deeper digging, he found the ratio of audience network inventory grew from 5% to 65% of total impressions. Solved by turning off audience network.
  36. 36. April 2019 / Page 35marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou How a marketer beat fraud 2016 Still buying through exchanges Measure In-Ad and arrivals On-Site 2017 Buy their own ads through DSP Took buying in- house 2018 Started serving their own ads Took ad serving in-house 2019 … Buying direct from good publishers
  37. 37. April 2019 / Page 36marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Measure in-ad and on-site In-Ad measurement • Blue means humans • Red means bots On-Site measurement “increase spend on sources driving more humans (blue); reduce spend on sources with more bots (red)”
  38. 38. April 2019 / Page 37marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Detect and reduce fraud in-flight Launch Week 3 onwardWeeks 1-2 Initial baseline measurement Measurement after first optimization After eliminating several “problematic” networks Stacked percent chart Blue (human) Red (bots)
  39. 39. April 2019 / Page 38marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Better media = better outcomes Measure Ads Measure Arrivals Measure Conversions 346 1743 5 156 A B 30X more human conversion events • More arrivals • Better quality more humans (blue) good publishers low-cost media, ad exchanges
  40. 40. April 2019 / Page 39marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Humans click and convert IN-AD ON-SITE CLICKED 1.2% Human CTR on ads 44% Human Clicks to Claim Form
  41. 41. April 2019 / Page 40marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Display 4 2,036 humans human conversion rate More humans = more outcomes Site Traffic Conversions 8,482 818 4,216 humans 5% human conversion rate 14,539 193 225 humans 9% human conversion rate 2,248 23 168 humans 5% human conversion rate 1,527 9 Display 3 Display 2 Display 1 Humans 40%
  42. 42. April 2019 / Page 41marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou About the Author Augustine Fou, PhD. acfou [@] mktsci.com 212. 203 .7239
  43. 43. April 2019 / Page 42marketing.scienceconsulting group, inc. linkedin.com/in/augustinefou Dr. Augustine Fou – Researcher 2013 2014 Published slide decks and posts: http://www.slideshare.net/augustinefou/presentations https://www.linkedin.com/today/author/augustinefou 2016 2015 2017 20192018

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