Announced earlier this month, the discovery of the “SneakyTerra” fraud scheme showed how an organized instance of fraud could impact more than 2 million devices a day. If left unprotected, this scheme alone could cost the industry over $5 million a month in ad spend. As the digital advertising industry grows, attacks like these show how fraudsters are evolving to take advantage of emerging technologies and supply chain complexity.

Some may consider fraud to be a buy-side problem. However, the truth is that this pervasive issue threatens the stability of the ad-supported ecosystem. And it takes millions of dollars away from trusted publishers in the process.

Recently, DoubleVerify surveyed 300 executives in the digital media sector. We asked digital publishers and supply-side platforms about challenges they have faced in the industry (particularly amid the 2020 Covid-19 pandemic). Publishers stated that “the ability to proactively identify and troubleshoot impression-level fraud issues” was one of their biggest concerns moving forward. Fortunately, there are several steps publishers can take to prevent the downstream effects of fraud from negatively impacting their revenue.

Stay informed

The World Federation of Advertisers estimated that by 2025, ad fraud will be a nearly $50 billion industry. With that much at stake, fraudsters are constantly evolving to work around measures that publishers have taken to quell their impact.

An example of this is ads.txt, a common method for publishers to increase transparency by declaring who is authorized to sell their inventory. While this practice accomplishes its goal of reducing fraud, it quickly became a target for a more advanced scheme. In 2018, fraudsters designed a bot network to take advantage of the ads.txt framework in order to commit fraud that would not trigger ads.txt violations.

This demonstrates that no single strategy against fraud will act as a silver bullet. Publishers need to stay vigilant and informed (alongside the rest of the industry) in order to keep a lid on fraud.

Develop transparency and best practices

The more shrouded the supply chain becomes in ad tech, the more gaps open up for fraudsters to exploit. Publishers can implement policies that provide a clear picture of where ad spend is directed to make it easier to diagnose and eliminate potential fraud. These policies have to put supply chain transparency at the forefront because it reduces places for fraud to hide.

In addition to a transparency-first approach, publishers have the ability to implement a few best practices into their anti-fraud strategy. These include:

• Proactively looking at inventory on ad exchanges to monitor for misrepresentation.
• Ethically sourcing ad traffic to prevent sources that benefit from fraudulent activity.
• Establishing baseline metrics and campaign expectations so that you notice irregularities caused by fraudulent faster.

Despite fraud continuing to have a measurable impact on advertiser and publisher performance, there is not a clear road map for anti-fraud strategies. Even if there were, those strategies often expose themselves to new opportunities for fraudulent activity. Publisher operations must remain nimble to combat this evolving threat.

Bridge the buy-sell divide

Fraudsters eat up thousands of opportunities for publishers to monetize inventory by posing as publishers. (Yet they operate with no obligation to create legitimate content.) To make matters worse, the presence of fraudsters in programmatic marketplaces often force trusted sellers to lower prices in order to compete with fraudulent inventory that appears to be high quality.

These second-order effects show how complex the fight on fraud can become. They also know that brands and publishers alone aren’t equipped to snuff it out. By working with third parties that bring buyers and sellers together through verification metrics that measure fraudulent traffic, publishers can prove the quality of their inventory, protect their reputation and give fraudsters fewer openings to exploit.

Fraud negatively impacts publishers by diverting key ad dollars away from premium inventory. This erodes the trust that needs to exist between buyers and sellers. However – with the right tools and strategic approach – the industry can reduce the impact of fraud and it can divert misplaced ad spend back to trusted content providers.