Programmatic is Largely to Blame for 2016 Rise in Ad Fraud
$7.2 billion was taken in ad fraud in 2016, all of which was a product of programmatic advertising, or the use of software to purchase digital ads. Programmatic came into the ad buying and selling mainstream around 2014 and spending via programmatic only grew in the years following, reaching an all-time high of approximately $22 billion in 2016.
That marked nearly two-thirds of all digital display ad spending in the United States in 2016. One-third of all money spent on programmatic, resulted in fraudulent ads. Ad fraud can stretch from fake news to fake clicks, and before 2016, the majority was found in bot-powered impressions and clicks.
Programmatic grew in popularity because of its convenience and efficiency, as well as its ability to match an ad buyer’s proper target audience. However, ad buyers, sellers and plenty others in the field failed to spot the possible downfalls.
Fake news sites created by a varied amount of opportunistic fraudsters, domestic and foreign alike, tormented the 2016 campaign trail with stories largely shared on social media networks such as Facebook and Reddit. These fake news sites profited greatly on the simple deception of American people, sometimes creating URLs to closely resemble reputable sources, like abcnews.com.co or usatodaycom.com.
Much of the fake news revolved around completely false and defamatory articles regarding Democratic Presidential candidate Hillary Clinton, and articles designed to attract supporters of now-President Donald Trump.
The driving factor for the ones behind these sites was the income they could make via ad sales. And the growing use of programmatic contributed to this. With little to no whistleblowers in place, ads were fed to fraudulent sites because regardless of how fake the stories were, they drove enough traffic to appear to be viable news sites.
This is how the programmatic system breaks down: Created for efficiency, no one seemingly foresaw the now-glaring possibility of someone taking advantage of the system. And fake news isn’t even close to being eradicated, and it won’t be until every ad seller has a human pointing out which sites pay host to fake news and which do not.
It’s actually pretty simple: Fake news only stops when ads stop being sold to fake news sites. The same is true for traditional bot-powered ad fraud. It only stops when you have protections in place to spot sites hosting fake impressions and blacklist them from further usage.