Corporates investing in digital advertising appear to be losing nearly half of their investment due to various reasons, particularly fraud.

New ad formats and channels, such as video or mobile, apart from websites, have turned out to be a breeding ground for fraud.

“Bots, developed by fraudsters, are deployed to engage with the ads, which leads to a massive dip in viewability,” says Rahul Vengalil, CEO of What Clicks, a digital media audit firm.

The fraud is typically carried out by creating fake ad traffic using content-scraping websites or other environments, getting bots to click on the ads, launching ads outside of a user’s view, or creating other fictitious mechanisms to deliver advertisements that are not seen by consumers.

As per the Media Rating Council (MRC) standard of viewability, an ad impression is considered viewed if 50 per cent of the ad space is seen by a ‘human’ for 1 second for a static ad, and 2 seconds for a video ad.

“Since ads are paid on cost per mile impressions, the more the impressions, even if fake, the more the payment,” adds Vengalil. “Brands that are not using any safeguarding tools might as well say goodbye to 30 per cent of their investment before the campaign even starts.”

Investments wiped out

Ad frauds can be highly damaging. “If a company has paid ₹1 crore for digital advertisement on a particular publisher’s website, it would have lost ₹88 lakh,” says Vengalil, blaming ad fraud for the poor rate of viewability, at 12 per cent.

Investments in digital marketing are on the rise, and expected to reach $300 billion in 2020. However, media experts insist that 30 per cent of the investments are not seeing the light of day due to the murky digital marketing ecosystem.

Clearly, there is a need to track genuine ad views in a fool-proof manner. “There is an onslaught of bad inventory in the system. Fraudsters have been able to get away with it because there is no end-to-end tracking that is being done, either by businesses or agencies,” he adds.