Digital Advertising Industry Striking Back Against Bot Fraud

Oct 21, 2015

Article ImageSoftware programs masquerading as humans and controlled by criminals are decaying trust in the ecosystem - and these bad bots are getting smarter by the day. It may sound like a mediocre movie plot, but the drama is all too real for advertisers, publishers, agencies and others in the digital advertising marketplace who are falling victim to bot fraud. Now, combatting the multipronged menace has become a priority for many stakeholders.

"[Fraud] has required people across the industry getting on board not just because it's in their immediate interest, but because they want to have a more honest industry," says Jason Shaw, director of data science at Integral Ad Science, which quantifies digital media quality.

To be sure, cybercriminals have long found ways to fleece the lucrative industry. Their methods, however, have grown increasingly sophisticated. In fact, global advertisers will lose $6.3 billion to bots this year, according to a 2014 report of the Association of National Advertisers and White Ops, which specializes in online fraud detection for digital advertising.

That report also found bots accounted for 11% of all display impressions observed and for 23% of all video impressions observed. Notably, a subsequent study White Ops conducted with Digital Content Next (DCN), an association of premium publishers, found the bot impact on display and video was much lower for participating members.

"It starts with our members generally having cleaner inventory than the internet writ large," says Lisa Kerr, SVP, market development at DCN. "Whether that's purchased through automation or direct, there's a higher level of quality there to start with."

DCN members are also proactive about reducing fraud. "One of the things we found is that complete eradication of bot fraud is probably impossible so it requires an ongoing level of commitment to monitor on an ongoing basis to make sure things haven't gone off the rails."

Bot Fraud Comes In Many Unsavory Flavors

Bad actors are using bots to cause havoc in numerous ways. Bots, for example, can render ads on sites, scroll through pages, click on ads and initiate video players, says Jessica Lopez, COO of Fraudlogix, which sells online ad verification solutions. "Every one of those engagements ultimately ends up triggering a payable event in the form of either a served ad impression or a click," she says.

The bot masters find ways to cash in. For instance, they launch websites with fake bot traffic. Advertisers buy ad space on the sites, often through programmatic exchanges, but their messages don't get seen by humans.

Meanwhile, the high-value targets attracting advertisers may actually be bots, too. Hackers use malware to infect household computers and make it appear as if bots are individuals browsing the web and collecting cookies. The bots may look like new mothers, car enthusiasts, or other kinds of visitors who advertisers are willing to spend big money to reach.

When bots visit legitimate publishers, they can skew performance metrics and ultimately affect a site's reputation. (As can bot traffic that publishers mistakenly or knowingly buy from third-party sources.)

Likewise, fake sites negatively affect real publishers. "These bogus sites oftentimes will rip off content, drive up their search engine optimization, and essentially compete with sites for the impressions and ad dollars," says Eddie Schwartz, president and COO of White Ops. 

Lack of Transparency Invites Fraud

The prevalence of automation in digital advertising is presenting new opportunities for criminals. "The ‘bad guys' who are responsible for the bots stand to make a lot of money with very little risk of being criminally prosecuted," says Lopez. "It's easier to get bots into the programmatic environment, and they can hide behind layers because there's multiple players involved."

Likewise, Shaw points out the proxies the industry uses to show that someone saw an ad or clicked on one can be gamed. "In an ideal world [an advertiser] would simply pay based on the action with an attribution methodology that is bulletproof," he says. "We're working on it but no one has that methodology yet. In the meantime, you have to attack the fraud directly."

Players Strengthening Defenses for Bot Battle 

Last year three advertising trade groups began collaborating to combat malware and create more transparency in the digital ad industry by forming the Trustworthy Accountability Group (TAG). It has since published anti-fraud principles, for example, and has a working group figuring out how the industry can share information about malware.

Advertisers can help mitigate their risk of bot fraud by demanding publishers be transparent about sourced traffic and served ad impressions.

In addition, publishers of all stripes can learn from their peers who participated in the DCN study and are seeing lower bot fraud rates in display and video. "Obviously if you're looking for cheap traffic, it's available," says DCN's Kerr. "Our members don't do that - they are much more vigilant about vetting and monitoring their partners . . . and there's an ongoing level of measurement and validation that the traffic purchased is valid."

Likewise, Kerr says many members are building pages in ways that make it easier to detect fraud. They also recognize that bots can act differently across sites.

"Understanding how bots behave on your site helps with the detection and mitigation and helps you understand what to look for as they change techniques to adapt to whatever's been put in place to stop them," Kerr says.

Third-party bot detection services are offering powerful tools for both advertisers and publishers. "The sophistication of the fraud that's being perpetrated requires sophisticated techniques," Shaw says.

Still, the cat and mouse game shows no signs of wrapping up. "Where there's money to be made, criminals will continue to innovate," Schwartz says. "It will be incumbent on the digital ad industry to also continue to innovate in the face of criminals who are not just going to walk away from billions of dollars of earnings."

(Image courtesy of Shutterstock.)