Digital Ad Fraud Estimates 
Impressions 
(CPM/CPV) 
Clicks 
(CPC) 
Search 
$18.1B 
Display 
$8.0B 
Video 
$2.9B 
$2.8B $3....
Ad Fraud Ranges 
• Display ad fraud fake ad 
impressions created by bots 
• Video ad fraud fake video ad 
views generated ...
Range of Ad Fraud Estimates 
DSPs/Networks Security Vendors 
3% 
Dstillery, Oct 9, 2014 
“findings from two independent th...
As more digital 
ads are placed 
entirely 
programmatically, 
the opportunity for 
fraud continues to 
increase. 
The Oppo...
The Motive 
“Highly Lucrative, Profitable 
The aggregate ad revenue for the 
sample of 596 sites was an estimated 
$56.7 m...
Bot vs Human Web Traffic 
Nea3r9l%y h6u2m%an bot 
61% bot traffic 
51% suspicious 
22-29% confirmed bot 
Source: Incapsula...
Digital Ad Spend (IAB H1 2013) 
CPM Performance 
Impressions 
(CPM/CPV) 
Clicks 
(CPC) 
Leads 
(CPL) 
Sales 
(CPA) 
Search...
Reported Cases 
- 8 - Augustine Fou
Ad Budgets Spent on Porn Sites 
A large British packaged goods 
company that sells several household 
name brands in the U...
Stealing $6 Billion From Brands 
Online Ad Fraudsters Are Stealing $6 
Billion From Brands 
Security firm White Ops claims...
20-30% of Display is Fraudulent 
Fraud is endemic across today’s display advertising 
ecosystem. Luttrell estimates 20 to ...
Online fraud costs e-retailers $3.5B 
Online fraud costs e-retailers $3.5 
billion in 2012 
CyberSource’s annual report no...
Dr. Augustine Fou – Digital Consigliere 
“I advise clients on optimizing 
advertising across all channels. One 
main area ...
Related Articles 
Fake YouTube Videos 
By: Augustine Fou, December 2013 
Motive and Opportunity for Ad Fraud 
By: Augustin...
APPENDIX 
- 15 - Augustine Fou
Digital Ads by Format 
Source: IAB, 1H 2013 Digital Advertising Report, Oct 2013 
- 16 - Augustine Fou
Pricing Model Trends 
Source: IAB, 1H 2013 Digital Advertising Report, Oct 2013 
- 17 - Augustine Fou
Upcoming SlideShare
Loading in...5
×

Ad Fraud Estimates by Augustine Fou Technical Forensics

162,665

Published on

Digital Ad Fraud estimates vary widely based on the methodology used to detect and the rounding and estimating of what can be considered "fraud" or "suspicious" ads. Regardless of the methodology, the size of the fraud is large and needs to be addressed by the industry as a whole.

Published in: Business
1 Comment
2 Likes
Statistics
Notes
  • Very interesting - thanks for sharing. Is it possible to list the sources on the first slide?
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
No Downloads
Views
Total Views
162,665
On Slideshare
0
From Embeds
0
Number of Embeds
3
Actions
Shares
0
Downloads
0
Comments
1
Likes
2
Embeds 0
No embeds

No notes for slide

Transcript of "Ad Fraud Estimates by Augustine Fou Technical Forensics"

  1. 1. Digital Ad Fraud Estimates Impressions (CPM/CPV) Clicks (CPC) Search $18.1B Display $8.0B Video $2.9B $2.8B $3.5B Mobile $35.5B Ad Spend Avg Fraud Rate Dollars Display 50% $4B Video 60% $2B Mobile 40% $2B Search 30% $6B TOTALS 39% $14B (U.S. digital ad spend only) Multiple sources, see Appendix - 1 - Augustine Fou
  2. 2. Ad Fraud Ranges • Display ad fraud fake ad impressions created by bots • Video ad fraud fake video ad views generated by bots • Mobile ad fraud fraudulent or accidental clicks • Search ad click fraud click fraud on search ads Range Average Dollars 30-70% 50-80% 50% 60% 30-50% $2-3B 20-40% $3-7B $1-2B $4-8B (U.S. Only) 40% 30% - 2 - Augustine Fou
  3. 3. Range of Ad Fraud Estimates DSPs/Networks Security Vendors 3% Dstillery, Oct 9, 2014 “findings from two independent third parties, Integral Ad Science and White Ops” 3.7% Rocket Fuel, Sep 22, 2014 “Forensiq results confirmed that ... only 3.72% of impressions categorized as high risk.” 57% Telemetry, May 26, 2014 “Telemetry found that 57 per cent were “viewed” by automated computer programs rather than real people.” 25 - 50% WhiteOps, Jul 14, 2014 “digital ad fraud outbreak – one that gobbles up roughly $14 billion in advertising spend and between 25 and 50% of ad spend per campaign” 45% Solve Media, Sep 19, 2014 “suspicious web activity dropped to 45% – still a high figure, but an improvement nonetheless from the high of 61% in Q4 2013” - 3 - Augustine Fou
  4. 4. As more digital ads are placed entirely programmatically, the opportunity for fraud continues to increase. The Opportunity - 4 - Augustine Fou
  5. 5. The Motive “Highly Lucrative, Profitable The aggregate ad revenue for the sample of 596 sites was an estimated $56.7 million for Q3 of 2013, projecting out to $226.7 million dollars annually, with average profit margins of 83%, ranging from 80% to as high as 94%.” Source: Digital Citizens Alliance Study, Feb 2014 - 5 - Augustine Fou
  6. 6. Bot vs Human Web Traffic Nea3r9l%y h6u2m%an bot 61% bot traffic 51% suspicious 22-29% confirmed bot Source: Incapsula 2013 Source: Solve Media Dec 31 2013 - 6 - Augustine Fou
  7. 7. Digital Ad Spend (IAB H1 2013) CPM Performance Impressions (CPM/CPV) Clicks (CPC) Leads (CPL) Sales (CPA) Search 43% $18.1B Display 19% $8.0B Video 7% $2.9B $6.5B NOTE: revenues annualized from actual 1H 2013 figures from IAB (assumes $42B annual ad spend) Lead Gen 4% $1.7B 11% Other $4.8B $2.8B $3.7B Mobile 15% • classifieds • sponsorship • rich media • email Source: IAB, 1H 2013 Digital Advertising Report, Oct 2013 $35.5B - 7 - Augustine Fou
  8. 8. Reported Cases - 8 - Augustine Fou
  9. 9. Ad Budgets Spent on Porn Sites A large British packaged goods company that sells several household name brands in the U.S. was defrauded of $488,000 when its $10,000-a-day video ad budget was spent on a network of junk web sites, according to an internal document leaked to Business Insider. Source: Business Insider December 2013 - 9 - Augustine Fou
  10. 10. Stealing $6 Billion From Brands Online Ad Fraudsters Are Stealing $6 Billion From Brands Security firm White Ops claims 1 in 6 PCs infected by bots By Mike Shields Source: Adweek, October 2013 - 10 - Augustine Fou
  11. 11. 20-30% of Display is Fraudulent Fraud is endemic across today’s display advertising ecosystem. Luttrell estimates 20 to 30% of display ad inventory is fraudulent. For an empirical counterpoint, the Chameleon botnet spanned all the major US ad exchanges at the time of disclosure and was driving enough fake traffic—on its own—to account for 30% of the display ad inventory sold through one of these major exchanges. The Chameleon botnet is not unique. For example, we will shortly be disclosing details of a second major botnet, with a distinct signature, targeting a distinct cluster of websites. Botnet traffic is also not just limited to fraudulent publishers. We have come to understand that the Chameleon botnet, for example, has supplied traffic both to the website of one of the most highly regarded US newspapers and also to the websites of one of the world’s largest online media companies. Source: AdExchanger April 2013 With display ad spend at $8B, that is $2-3B of fraud - 11 - Augustine Fou
  12. 12. Online fraud costs e-retailers $3.5B Online fraud costs e-retailers $3.5 billion in 2012 CyberSource’s annual report notes an average fraud rate of .9% of online revenue. Source: Internet Retailer, March 2013 - 12 - Augustine Fou
  13. 13. Dr. Augustine Fou – Digital Consigliere “I advise clients on optimizing advertising across all channels. One main area of focus is reducing ad waste due to fraud – fake impressions, clicks, leads, and sales.” FORMER CHIEF DIGITAL OFFICER, HCG (OMNICOM) MCKINSEY CONSULTANT CLIENT SIDE / AGENCY SIDE EXPERIENCE PROFESSOR AND COLUMNIST ENTREPRENEUR / SMALL BUSINESS OWNER PHD MATERIALS SCIENCE (MIT '95) AT AGE 23 ClickZ Articles: http://bit.ly/augustine-fou-clickz Slideshares: http://bit.ly/augustine-fou-slideshares LinkedIn: http://linkd.in/augustinefou - 13 - Augustine Fou @acfou
  14. 14. Related Articles Fake YouTube Videos By: Augustine Fou, December 2013 Motive and Opportunity for Ad Fraud By: Augustine Fou, February 2014 Fake Facebook Profiles By: Augustine Fou, Dec 2013 Fake Twitter Accounts By: Augustine Fou, August 2013 Display Fraud 101 (video) By: Augustine Fou, Feb 2014 ROI Case for Solving Ad Fraud By: Augustine Fou January 2014 Digital Ad Fraud Briefing By: Augustine Fou December 2013 How Display Fraud Works By: Augustine Fou, May 2013 How Click Fraud Works By: Augustine Fou, November 2013 The Magnitude of Digital Ad Fraud By: Augustine Fou, November 2013 - 14 - Augustine Fou
  15. 15. APPENDIX - 15 - Augustine Fou
  16. 16. Digital Ads by Format Source: IAB, 1H 2013 Digital Advertising Report, Oct 2013 - 16 - Augustine Fou
  17. 17. Pricing Model Trends Source: IAB, 1H 2013 Digital Advertising Report, Oct 2013 - 17 - Augustine Fou

×