According to a joint report published by the Association of National Advertisers (ANA) and WhiteOps, a company specializing in human verification and data integrity, ad fraud was estimated to cost marketers $6.5 billion globally in 2017. This year, those losses could range from $6 billion to $16 billion. That’s an incredible amount of money lost, especially considering the ongoing growth of digital marketing in today’s world.

 But what is ad fraud, exactly? Ad fraud occurs when a perpetrator tricks advertisers into paying for something that is inaccurate or worthless, whether it is clicks, impressions, or misrepresented or inefficient ad traffic. There are many different types of ad fraud, but automated software programs, also called bots, are often the primary vehicle for online ad fraud.

 Ad fraud has been around since digital marketing began, and is causing a number of problems for marketers who are increasingly advertising online. In 2015, Google was found to be charging advertisers whose ads on YouTube were being viewed by bots, even after they were detected by Youtube’s fraud software. As digital advertising is predicted to grow, unfortunately so is ad fraud.

 According to the ANA report, “traffic sourcing,” otherwise known as buying your ad traffic from non-organic sources, contributed to 3.6 times as much ad fraud than non-sourced traffic, making it the number one source of ad fraud. In 2016, nine percent of desktop display ad spending and 22 percent of video ad spending was fraudulent. The report states that fraudulent bots are thriving online because they’re becoming more sophisticated, while simultaneously getting better at resembling humans.

 While this type of fraudulent behaviour poses major threats to digital advertisers, an emerging video sharing platform called Verasity is implementing a new technology they think could have what it takes to combat ad fraud. The patent-pending system is titled Proof of View (PoV). PoV’s technology is based on blockchain and provides accurate watcher metrics for better value-based payments between content creators, viewers, advertisers and sponsorship brands.

 The idea of value-based payment is important here. By focusing on value, rather than the overall number, Verasity aims to provide more return on investment for digital advertisers.. Their PoV technology works to prevent bots from counting towards a user or video’s overall views, and they aim to make their viewership data more reliable than other video sharing platforms. Currently, content creators can easily buy fake views from bots on well-known platforms, including YouTube. These fake views then skew the numbers that YouTube and its content creators provide to advertisers and sponsors, contributing to digital ad fraud.

 In comparison, Verasity’s PoV system only counts views from signed-in viewers, therefore preventing bots and other automated systems from  contributing to overall views. The system also disallows viewers from creating multiple views at the same time, meaning it will not count videos playing in multiple windows simultaneously.

 PoV also prevents inflated view counts from actions such as bots automatically replaying videos, attempting to load multiple videos at the same time, or attempting to manipulate analytics. For instance, a bot can’t leave a video on loop one million times and claim it has one million views, as the PoV technology would identify that.

 There is a justifiable lack of trust between digital marketers and online ad platforms as ad fraud continues to rise, with billions of dollars expected to be lost to ad fraud year after year. As a platform that relies on user engagement, content creator satisfaction, and advertising dollars, Verasity has plenty at stake with the accountability of their platform. Therefore, they hope to offer an additional layer of security to their PoV system.

To create a more transparent system, Verasity plans to count only “true views,” or views that have passed their PoV verification method, by documenting them in a publicly accessible database that contains anonymous viewership information.

 On top of that, Verasity will provide free, open-source tools that users, stakeholders and third parties can use to analyze a public database which contains viewership data. By being so transparent in their methodology, Verasity wants advertisers and sponsors to trust that the numbers they are promised by the video sharing platform are not falsified, as ad fraud may have led them to believe in the past.

While ad fraud increasingly continues to cause detriment to advertisers’ overall digital revenue, there is technology being developed that could help combat these issues. Fraud-detection technology is being continuously advanced, and Verasity’s PoV method could provide a solution for digital marketers’ current woes.

 

This article was written by Hayley Davison.