Unraveling the Chaos: The State of Ad Fraud, Bad Ads and Made-for-Advertising Sites

Programmatic advertising has been a game-changer for marketers, but the system is not perfect. It’s been criticized for its lack of transparency, as advertisers rely on algorithms and data to make decisions about where their ads will appear, trusting that the tools will make the best decisions.

A recent ANA Programmatic Media Supply Chain Transparency Study found only 36 cents out of every ad dollar effectively reaches the consumer. The research indicated 29% goes toward transaction costs and a shocking 35% is wasted, including on ad fraud (such as non-viewable or invalid traffic from bots) and other ad waste -- like irrelevant audiences and made-for-advertising (MFA) sites.

Here's a quick summary of the programmatic chaos advertisers now face:

Ad Fraud

As cybercrime has skyrocketed, ad fraud has become more pervasive, costly and challenging to overcome. Fraudulent bot traffic is a real concern, especially for display and social advertising.

 

Bad Ads

Marketing Dive recently summarized a new Forrester report that breaks down the types of bad ads, ranging from malicious ads aiming to intentionally scam consumers, to miscategorized ads, intended for one audience but viewed by another. Bad ads damage consumer trust and can hurt brand reputation even for good ads, with the Marketing Dive article noting that when “...exposed to bad ads, consumers are more likely to mistrust good ads and even block all ads, decreasing reach for marketers.”

 

Made-for-Advertising (MFA) Sites

A concerning trend is the rise of MFA sites, which offer cheap but worthless impressions to advertisers. Ad Exchanger reports that the term “made-for-advertising” wasn’t even used in 2020, and while these types of sites did exist then, they only accounted for 5% of all open web auctions. By mid-2023 they constituted an estimated 30% of ad auctions and are expected to keep their stake, or rise, this election year, especially as generative AI tools make it even easier to produce erroneous or fabricated content at the click of a button. 

These sites generate real human traffic but with poor content and are often overloaded with ads. It would be easy to place all the blame on MFA sites and operators, but Ad Exchanger notes that the supply exists because of the demand. When advertisers want cheap views, without demanding a quality audience, MFA sites will deliver.

 

Programmatic advertising offers many benefits, such as efficiency, scalability, and targeting capabilities, and that’s why it’s worth it for marketers to adopt solutions like these to address today’s challenges:

 

Transparent Media Activation

Marketers invest substantial resources in campaigns, so it's crucial to understand where exactly the money is being used (check out our blog on this topic) and how the campaign is being run -- from the programmatic platforms you use to how you track and analyze ad performance.

Transparent media activation occurs when advertisers align with trusted agency partners who have the expertise and tools to navigate the programmatic landscape effectively. A media activation partner should mitigate the risk of ad fraud and steer clear of made-for-advertising sites, ensuring that ads reach not only real people – but the right people. At the same time, agencies need to be transparent with their clients, ensuring that the right channels are selected and the right audiences are accurately targeted.

All of this is why media activation has become one of OMI’s most popular new services. Our approach is all about delivering results, and we do this by putting our clients in position to engage and activate the most accurate, targeted omni-channel audiences. To elevate social and programmatic ROI, we apply fresh deterministic intent data on top of a custom audience built specifically for you using our high-quality proprietary Living File^® database.

A huge benefit to proprietary data is the ability to target all the way down to the individual decision-maker level based on device attributes. And with deterministic cross-device tracking, consumer logins serve as a primary identifier for matching multiple devices to a single user -- instead of to a group of users that may share a device. This method tends to have higher targeting accuracy since consumer login information is unique to an individual.

 

Clear Reporting

Transparency in the media buying process also includes reliable performance measurement and reporting, which enables marketers to make data-driven decisions and optimize their campaigns for maximum ROI. Advertisers need actionable insights into their campaigns to optimize performance. By focusing on key metrics such as engagement, conversion rates, and audience demographics, advertisers can gauge the effectiveness of their advertising efforts and make informed decisions moving forward.

 

The bottom line is that marketers need to be more vigilant when it comes to media activation and reporting: ad fraud and ad waste are eating away budgets and delivering “impressions” without any value. By demanding transparency and focusing on quality over quantity for campaign outcomes, advertisers can navigate the programmatic ad chaos with confidence, armed with the tools and insights needed to drive meaningful results and maximize ROI.

 

Reach out to our team for proven solutions to today’s chaotic programmatic challenges.