Already a scam that cost companies $1.63 billion in 2018, the value of digital ad fraud is set to increase by 23% in 2019, according to a study.

techARC, which tracks the digital ad sector in India, reported that the country’s share of ad fraud – which covers any form of fraudulent traffic that distorts ad metrics – currently accounts for 8.7% of the world’s total.

Digital commerce accounts for around 51% of the total ad fraud in India. And some 85% of fraud comes through apps, the report said, but it added that web platforms are often more vulnerable.

Web platforms are also especially exposed to brand safety issues, such as fake leads and keyword abuse. And, as video becomes ever more popular, fraudsters continue to develop sophisticated fraud techniques adapted to the medium.

According to the research, the fraud problem is especially prevalent in banking and fintech, entertainment and gaming (particularly video gaming), as well as healthcare and pharmaceuticals, where the primary focus is on gaining new customers.

Faisal Kawoosa, founder and chief analyst, techARC said: “Digital ad fraud is getting increased attention from the C-level leadership of evolved organisations, where it is no longer an agenda of a CDO or CMO.

“The impact of digital ad fraud now goes beyond diminishing the returns on marketing spends and can jeopardise the entire digital transformation journey, hampering brand equity, relevance and positioning,” he added.

The study called for digital brands and traditional businesses to develop comprehensive online-to-offline ad fraud strategies as “businesses continue to dilute their single-channel positioning to omni-channel brands”.

And it noted that businesses with such a strategy in place are “better equipped to have higher levels of customer engagement. This is because they are able to contain abuse through their brand and serve only the most relevant things to their customers.”

However, coming up with comprehensive strategies to defeat the fraudsters is far from easy.

As Nishad Ramachandran, chief digital officer of digital-marketing company Hansa Cequity, told the Business Standard, “We are seeing a lot of ad-tech companies and technology players come up with tools to help deliver high-quality ad impressions. Stopping ad fraud is a cat and mouse game.

“The moment a new technology comes in to prevent a type of fraud, the fraudsters start finding workarounds around these toolsets to continue to gain their share from online ad spends.”

Sourced from Business Standard; additional content by WARC staff