“Switch from cost-per-click to cost-per-action model to put a curb on ad fraud”

Although marketers and advertisers are well aware that rampant issue of mobile ad fraud in the country, they are  yet to gauge the impact of the fraud has on their business and customers.  But there is a shift in mindset towards formulating an ad fraud prevention strategy and spending on the right tools.  Dakshen Ram, Co-Founder & Head of Product and Strategies, Resulticks tells  what it takes to create an effective ad fraud detection plan. 

V&D: Besides the lack of penalties and transparency in industry regulations, what are some of the other reasons behind the rising ad fraud scenario in India? 

Advertising fraud has existed ever since online advertising came into being. A recent digital ad-fraud market report by techARC notes that app fraud contributes to more than 85 percent of the total digital ad fraud, indicating that web platforms are quite vulnerable to fraud.  In recent years, app fraud has also caught the attention of leadership teams in many organisations, making the threat of ad fraud and its ripple effect a serious concern across the online advertising ecosystem.

The digital industry, in general, has recognised this as one of the major constraints of the online advertising business. With limited or no regulations to combat digital fraud, marketers have become increasingly concerned about how to address cybercrime. Inadequate penalties and absence of strict industry regulation have spiked digital crimes making it difficult to curb this issue.

V&D: Fraudsters are pivoting on newer attack techniques. But are advertisers willing to spend on detection and prevention tools?

With frauds being extensive in the Indian advertising ecosystem, mobile applications are leaning on the riskier side. In the last few years advertising on mobile platforms and videos has surged significantly. The Mobile Marketing Association (MMA) reported that an estimated 20 percent of mobile ad spends in India are subject to ad fraud.

Considering advertising fraud is a concern across the global landscape, there is a significant shift in mindset towards spending on ad fraud prevention tools.  Businesses that have put aside a budget for detection and prevention of ad frauds are better equipped and far ahead when it comes to handling a crisis and mitigating losses.  But marketers and advertisers are yet to gauge the impact the associated fraud has on business and customers.  Hence, the amount of money that organisations are willing to spend on detection and prevention tools to limit digital ad frauds is less than a quarter in any marketing budget.

V&D: How effective are technologies like AI/ML, Blockchain in fighting the ad fraud menace?

Machine learning can handle large volumes of data from varied sources and identify patterns of irregularity to fix the menace. With the right feed, ML can capture patterns of behavior to detect fraud and in combination with AI at a more robust volume.

Since its advent, blockchain has been touted as a potential technology for the prevention of click fraud in the digital space. In India, marketers are yet to understand and unlock the true value of blockchain application to prevent digital frauds. With online fraud on the rise, marketers are streamlining budgets to cover ad frauds but seem unaware of the capabilities blockchain offers to prevent attacks and data frauds.

While marketers are aware of these technologies to detect and prevent fraud, they are challenged by the complexity of and lack of knowledge and experience in applying them. Bluntly put, marketers have a long way to go before AI, ML, and Blockchain can be put to positive impact in fraud detection technology.

V&D: Tools and techniques of ad fraud are evolving very fast, while the fraud prevention solutions providers are busy playing catch-up. Could you suggest some best practices for the advertisers to protect themselves?

Check your campaign metrics regularly. When the publisher’s performance report does not match the real traffic on your website or the already established conversion benchmarks, there may be reasons to worry.

If there is a huge gap between the number of clicks generated and the number of visits, if the click-through rate (CTR) is very high but still has not translated into visits, it should raise a red flag in the marketer’s mind.

The high volume of hits from IP addresses that can be traced to a data centre instead of a household or corporate computer means a fraudster is at play. Visits from very low domain authority sites or spammy looking sites are another indicator.

To detect these trends and bring in preventive measures, marketers need to check campaign analytics and site analytics very closely on a regular basis to catch any exceptions.

Effective fraud detection plans need to have elements of resilience, adaptivity, and quality data. All of the above can be detected through Analytical / ML / AI models that will provide quick insights to any fraud trends and can be actioned by a marketing team. Techniques like feature extractions are being used extensively. Sometimes, switching from cost-per-click to cost-per-action advertising model, or cultivating trust with advertisers by having independent audits will yield better results.

Also Read:  

Lack of industry standard hinders the fight against ad fraud menace

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