The document discusses issues with viewability and fraud in digital display advertising. It notes that as much as 92% of display ad impressions are not seen by humans due to bot traffic, technical errors, and other fraudulent activities. This results in billions of dollars being wasted annually. The author advocates for advertisers to fire agencies that cannot ensure at least half their ad spend is effective. Metrics should also be adjusted to reflect the actual viewability percentage, often around 8%. Strict viewability standards and avoiding high-fraud countries and publishers are recommended to protect ad budgets from being wasted.

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The Billions We're Losing
in Display Advertising
Samuel Scott
Director of Marcom - Logz.io
http://www.samueljscott.com
http://logz.io

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£6.5 billion!
— Campaign Live
(£88 billion spent globally on digital ads)

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What is an Impression?
“When an ad is requested by a user’s browser”
- Interactive Advertising Bureau

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Humans have nothing
to do with it!

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This Number is BS

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Most Impressions Are
Never Seen by Humans
• “20% on a computer or smartphone screen were seen by
actual people” — Bloomberg
• “54% weren’t seen by real people”
— Wall Street Journal
• “85% don’t have the opportunity to be seen by a real
person” — MediaPost

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Ad Network Failure
15% of the time something goes wrong
— Wrong ad loads
— Technical failure, nothing loads
— Still an impression!
— MediaPost

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Bot Traffic
60% of all Internet traffic
is bots
— A bot visit still counts as a page view
— Still an impression!
— The Atlantic

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Publisher Fraud
“25% of the entire entire online advertising
market is fraudulent”
— Adweek

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Publisher Tricks
— Changing ad units to 1x1 pixel size
— Stacking numerous ad units on top of each other
— Redirecting people to sites they don’t want to visit

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Buying Bot Traffic
— Pay ad network $0.0020 for bot visit
— Get $0.0025 to $0.0040 in ad revenue
— 25% to 100% profit margin for doing nothing!
— Digiday

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Bottom Line
Only 8% of display ads have the chance to be seen.
— MediaPost

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Kickbacks & Collusion
Example:
— Media buyer spends $1 million on ad network
— Ad network sends $200,000 to a corporate sibling of
the agency for a “presentation”
— Ad Age

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Arbitrage
Example:
— Media buyer & agencies spend $1 million on ads for
a client
— Bills client for $1.2 million for the ad spent
— Ad Age

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What’s Going On
Clients give money to agencies & media buyers to buy ads
The agencies & media buyers give money to ad networks
The ad networks give some money back to the agencies & media buyers
The agencies charge clients for more than the ad cost
The clients' display ads are only 8% viewable
The 92% non-viewable impressions still earn money
for publishers & ad networks

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The Industry’s Response
IAB goal: 70% viewability
— But will countries accept billions of losses?
— $25 billion of online ad spend is under review
in “Mediapalooza”
Google: ActiveView
Facebook is also working on viewability

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The Industry’s Response

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How to Protect Yourself

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Fire Bad Agencies
& Media Buyers
If they say: “Half of
my ad spend
is wasted, and I
don’t know which half”
Exterminate!

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Adjust Metrics
in Human Terms
Spend Impressions CPI Viewability Real CPI
$10,000 100,000 $0.10 100% $0.10
$10,000 100,000 $0.10 8% $1.25

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Don’t Spend in
Bad Countries
Country % of Fraudulent Traffic
China 92%
Venezuela 80%
Ukraine 77%
United States 43%
Source: AdWeek

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How to Protect Yourself
lide of this presentation for a list of resour

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Questions?
Samuel Scott
Director of Marcom
Logz.io
samuel@logz.io
Twitter - @samueljscott
http://www.samueljscott.com
http://logz.io

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Resources
— Moz (my article): https://moz.com/blog/online-advertising-fraud
— Bloomberg: http://www.bloomberg.com/features/2015-click-fraud/
— Marketing Land: http://marketingland.com/many-faces-programmatic-
ad-fraud-142335
— Bob Hoffman’s Ad Contrarian blog: http://adcontrarian.blogspot.co.il/
— Individual slides have linked sources at the bottom