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Why intelligent data collection will prove integral to preventing ad fraud in 2020

(Image credit: Image Credit: The Digital Artist / Pixabay)

Preventing ad fraud was a high priority for marketers in 2019, and it’s not hard to see why. It’s estimated that ad fraud cost brands an eye-watering $42 billion dollars in 2019 alone. Research indicates this phenomenon is set to continue in 2020. AdLedger, a nonprofit consortium working on creating blockchain standards for online advertising, showed marketers wasted $1.4 billion on fraudulent over the top (OTT) ads in 2019, demonstrating how online video streaming is now the new frontier for advertising fraudsters.

Ad fraud may not be new but its impact on the marketing industry has progressively increased during the last three decades. Fraud attempts currently amount to 20 per cent to 35 per cent of all ad impressions; which represents not just a lot of impressions lost to fraudsters, but a significant share of an advertiser’s audience that is not being exposed to the desired messages, and a sizeable chunk of advertising budget gone to waste.

The digital advertising environment now involves thousands of intermediaries, presenting a plethora of dark corners for fraudsters to conceal criminal activity in.  Fraudsters know when they’re being watched, and have become even more sophisticated as a result, making the challenge of preventing ad fraud harder than ever before.

How organisations can to move beyond traditional approaches to prevention

Traditional approaches to combating ad fraud have proved unsuccessful so far. Fraudsters have been rapidly evolving their techniques, making it harder to spot malicious activity.  Whether it’s by using bots that mimic human behaviour, creating false social media impressions, streaming music to increase royalties, inflating app store downloads or creating fake reviews – there are numerous examples of the methods of advertising fraudsters evolving.

The key to fighting ad fraud is to use residential IP addresses to simulate the presence of legitimate users. This has been proven to be the only effective way to fight fraudsters to date.

IP proxy networks, which include residential proxy networks, are already being used by thousands of global brands and businesses worldwide. Large enterprises, e-commerce companies, travel agencies, financial service providers and of course, marketing agencies are all using IP proxy networks to view the internet with the complete transparency the typical consumer does each and every day – openly and freely.

The value proxy networks can unlock

IP proxy networks enable businesses to access any openly available online data without either being blocked or deliberately served misleading information. This gives businesses access to accurate data in real-time from any corner of the world. So how can proxy networks assist you in combating ad fraud?  Every advertising campaign is built on a complex digital journey of ad content, and it’s crucial for advertisers to ensure that it reaches the exact demographic they are aiming to influence.

This demographic targeting is based on an individual’s IP address. In order to view ads just like your desired target audience, marketers need to have access to an IP address originating from the same location (country, city etc).

Brands can do it themselves but they risk being identified by fraudsters who will quickly notice this and cover their tracks as a result. Fraudsters can spot brands or data centre originated IP addresses, as these are easily identified as non-consumer IP addresses. When they know they are being monitored, they will quickly respond by showing your business false information so they can continue their malicious activities. 

If brands want to be able to effectively verify and test their advertising campaigns, they need a way of viewing the internet as if they were one of millions of consumers being served an ad no matter where they are located around the world or which device, or internet service provider they are using. With an IP proxy network, they can simply follow their advertising campaign just like their target audience is meant to do, no matter where they are based in the world.

By using IP proxy networks, advertisers can test the multiple different ads that might be presented to the user, which are all competing for their attention. Take a social media brand, for instance, which could leverage an IP proxy network to split a user session and check all ads served to that particular user at that particular time, simultaneously without being hijacked by fraudsters.

Why businesses need to be able to learn from fraudsters

The investment in digital advertising is huge, standing at $333.25 billion in 2019, and every business is a potential target for ad fraud. As such, ad fraudsters have developed multiple methods to identify a business’s advertising ‘soft spot’ and exploit its revenue chain.

If fraudsters are executing their campaigns very quickly and on a massive scale; the same approach must now be taken by brands. This is best achieved by using an IP proxy network, as this can leverage the real IP addresses of consumers, allowing businesses to see advertising campaigns exactly as real consumers see them. In short, this allows you to make sure that your ads are seen by the right people, in the right places, and at the right times – and that you get the right level of return on your ad spend.

Or Lenchner, CEO, Luminati Networks

Or Lenchner is the CEO of Luminati, a leading IP proxy network provider to global brands, its customers include Fortune 500 firms, major travel companies, developers, social platforms and ecommerce players.