What is ad fraud?

Ad fraud happens anytime that a human or bot clicks or engages with an online advertisement with zero intention of converting or legitimate interest in the product or service promoted by that ad.

Ad fraud is a $51M per day robbery that is happening on all major networks and exchanges. Nearly half of an advertisers budget is being stolen. This affects virtually everyone from advertisers, publishers, and even individuals who use social platforms and websites where ads are purchased and displayed.

 

How much do advertisers lose to ad fraud?

Estimates for how much money is lost to ad fraud vary because it’s often an invisible crime. Fraudulent schemes designed to steal money from advertisers and publishers cost marketers an estimated $51 Million dollars a day.

Estimates indicate that anywhere from 30-70% of an advertisers budget is being lost to fraud.

 

Is ad fraud a serious problem?

Yes. Ad fraud is the most profitable kind of criminal activity with returns of up to 2500-4100% on investment for online scammers.

Ad fraud is the 2nd biggest source of income for organized crime. The first is the global drug trade.

 

How does ad fraud work?

Ad fraud is carried out in many different ways including spam bots, click farms, malware, pop-unders, and click bait sites.

If you’re an advertiser, you are losing money. If you are a publisher, you’re not getting the revenue share that’s rightfully yours. And if you’re a consumer or visitor to websites where ads are displayed you are the one who is paying for it. It’s your data mobile data, bandwidth, and battery life that fraudsters are hijacking to run the whole operation.

Ad fraud is largely undetected most of the time and it’s perpetrators are rarely, if ever, caught.

 

What is a spam bot?

A spambot is a script or piece of code that functions like a parasite, infecting host computers or browsers and hijacking processing power to carry out invisible actions. These hidden operatives could be looking to carry out a host of different tasks from collecting people’s contact information to generating fraudulent impressions or clicks on PPC display ads served up by major networks like Facebook and Google.

 

What is a click farm?

Click farms are companies that hire real people to to surf the internet, visit their customer’s websites and click on the display ads served up on the page. Impressions and engagement metrics generated by click farms are technically human, however they are still fraudulent because there is zero chance of conversion. They’re the empty calories of online advertising.

 

What is clickbait?

Clickbait sites are websites that exist for the sole purpose of displaying ads and generating revenue. They use content as bait and surround that content with elaborate ad display systems that create a gated effect where users are forced to click in order to see it.

 

What is malware?

The term Malware refers to malicious software. It is a script or a piece of code designed to hijack the processing power of your device in order to serve you ads, create impressions, and generate clicks while your steaming content or reading an article online.

Malware can also be used to collect your personal data and contact information like email addresses and phone numbers to use for suspicious or predatory purposes.

Matt Gallant

About Matt Gallant

I'm a seasoned, serial entrepreneur who’s built 13 profitable companies. My 20 years of advertising experience has prepared me perfectly for tribeOS. Over 8 million leads captured, over 13,000 marketing experiments performed, over $10 million spent on digital advertising, and over $40 million generated in online sales. My single-minded purpose is to create the most profitable advertising marketplace ever for advertisers and publishers.

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