With more businesses ratcheting up their ad spend, 2020 is shaping up to be a big year for digital advertising. But as advertising spend balloons in a post-pandemic world, it’s important for advertisers to remember one big issue in online advertising: fraud.

Did you know that advertisers spend billions of dollars every year on ad fraud? In 2019 alone, businesses globally lost $40 billion on fake ads.

Simply put, ad fraud is the biggest expense that many business owners have never yeard of. Not only is it a huge problem, but this fraud can be hard to track down, quantify, and prevent.

These bad actors not only decrease confidence in PPC, but waste brands’ budgets and ravage your data tracking. You could discontinue PPC campaigns altogether to stop ad fraud, but even then, you’ll miss out on thousands of dollars of potential revenue generated from ads.

What’s an advertiser to do?

What is ad fraud?

Ad fraud is a sophisticated scam. It uses paid ads (usually banner ads or video ads) to defraud businesses. In other words, these scammers sneakily steal your advertising budget, asking you to pay for clicks and views that never even happened.

Programmatic ads are most at-risk for ad fraud, but this scam happens on nearly every advertising medium. The fraud manipulates how the ads are delivered to the audience, using a variety of strategies to trick you into paying for fake ad inventory.

There are so many types of ad fraud out there, but the most common ones include cookie stuffing for affiliate marketing and traffic fraud.

Scamsters commit fraud because it’s profitable. They sell you the inventory and pocket your budget dollars. Meanwhile, you’re paying for ads that never happened, watching a dwindling conversion rate and increasing ad spend.

But how big of a problem is this for your business?

Ad fraud is a big issue for any advertiser because it:

  • Makes your data useless: These fake clicks or impressions skew your numbers. You might think your campaigns are effective when, in reality, you’ve been advertising to bots the entire time.
  • Wastes money: You’re paying full-price for fake ads. It’s an infuriating waste of precious marketing dollars.

You’re advertising to get results, right? Fight back against ad fraud to preserve your budget and get more real clicks on your ads.

Our 5 favorite methods to prevent ad fraud

But how do you prevent something as common and undetectable as ad fraud? While you can’t prevent 100% of fraud, you can significantly minimize it with the right strategy. Follow these 5 tips to start fighting ad fraud.

1. Join reputable ad networks

While big-name networks like Google Ads and Facebook Ads still fall prey to scammers, they have a lot of safeguards in place to prevent ad fraud. Smaller ad platforms promising very low costs and high yields are often too good to be true. Use less-reputable platforms at your own risk; they’re often fronts for fraudsters.

Another option is to join a private advertising marketplace. These marketplaces have stringent invite-only networks that carefully screen publishers. That means you stand a better chance of paying for legitimate inventory.

2. Look for abnormalities

If you’ve been running ads for several months or years, you know when something doesn’t look right. Abnormalities are a common red flag that could mean ad fraud.

Are there sudden spikes in traffic? A lot of clicks at 3 AM on a Tuesday? These abnormalities warrant investigation.

Consider adding behavior signatures to your analytics. Signatures study each user’s behavior. If they act too fast or aggressively, they’re labeled as a spam bot.

The problem is, many businesses overlook abnormalities because they aren’t monitoring campaign performance. While we love AI tools and automation, you still need to have human eyeballs on your campaign once a week to check for abnormalities.

3. Block spammy IPs

IP blocking is another great strategy to prevent ad fraud. This should be your next step if you discover a certain IP is responsible for bot traffic. You can block that IP from accessing your ads, saving your ad budget.

To start, use a few common blacklists to get off on the right foot. As you monitor your campaign, add any suspicious agents to your blacklist to preserve your ad budget.

4. Rely on Ads.txt standards

How can advertisers identify legitimate publishers? Big platforms like Google Ads are trying to verify their publishers with the Ads.txt protocol.

Created by the Interactive Advertising Bureau, Ads.txt is a snippet of code that prevents domain spoofing. In layman’s terms, that means this code verifies the publisher’s site is real, and that it sold legitimate inventory to you.

This addresses just one type of ad fraud, but it’s easy to implement—so why not give it a try? Google Ads requires it for publishers, but always check that your ad platform follows Ads.txt standards.

5. Attribute to conversions, not just clicks

Ad fraud not only drives up your marketing spend, but it also ruins your PPC data. Since we can’t prevent all fraudulent clicks, it’s best to move away from a click-centric mentality.

Yes, clicks can be very valuable. But they don’t put dollars in your bank account. Instead of focusing heavily on clicks, move to a conversion-focused attribution model. It’s difficult for scammers to fake conversions, so there’s a better chance that this data is an accurate yardstick of your efforts.

The Bottom Line

Ad fraud is a huge, expensive problem. Platforms and advertisers are doing what they can to prevent this issue, but you need to be on the lookout, too. Scammers are using newer, better methods every day to steal your advertising budget.

We can’t prevent all advertising fraud, but we can minimize it. Follow these 5 tips to get a better view of your data, overhaul PPC ROI, and preserve your marketing budget.

Need extra help optimizing your PPC campaign? That’s what we’re here for! Get in touch with Logical Media Group to overhaul your campaigns to sell.

Chris O'Neill

Chris O'Neill

CEO at Logical Media Group