The&Partnership and Adloox claim digital ad fraud will hit $16.4bn in 2017

The&Partnership, m/SIX media and fraud detection specialists Adloox have published a report laying out the steps they believe the ad industry should take to reverse the rising tide of advertising fraud as new figures from Adloox suggest advertisers could be defrauded of $16.4bn in 2017.

The ‘What Happens Next: How to Reverse the Rising Tide of Ad Fraud’ report was commissioned by The&Partnership and m/SIX last year and carried out over a period of 12 months by Adloox.

The study suggests the global cost of advertising fraud may have been significantly under-reported. Previously believed to cost advertisers $7.2bn globally each year, Adloox’s figures claim the real cost of ad fraud may have been as high as $12.5bn in 2016 – accounting for almost 20 per cent of the $66bn spent on digital advertising.

In 2017, if advertising expenditure grows to $80bn as forecast by eMarketer and advertising fraud continues to evolve at its current rate, this figure would rise to $16.4bn.

The&Partnership CEO Johnny Hornby (left) says: “These figures serve as a stark reminder that much still remains to be done in order to protect and nurture the future vitality of the digital economy. We have a duty to come together as an industry – from media agencies and industry bodies, to big-platform players like Google and Facebook, bringing in government help if we need it – in order to protect our own future and those of our clients.”

T&P’s media agency m/SIX has a policy of requiring all its clients to invest in specialist third-party, pre-bid ad verification such as that provided by Adloox – which claims to reduce the risk of fraudulent placements by up to 15 per cent

Hornby says: “Clients need to be willing to get themselves off the drug of cheap digital media and invest in proper band protection. Pre-bid verification technology costs all of three pence per 1,000 impressions, accounting for about two per cent of a brand’s overall media spend. But for all the diligent clients out there, there are still plenty of others who are refusing to pay for it. If nothing else, this report proves what a false economy that is.

“The the big-platform players like Google and Facebook need to step up to the plate and engage with initiatives like those launched by TAG and JICWEBS. They also need to put much better preventative measures in place to ensure that offensive and politically inflammatory content – beyond the wider debate about whether it should be published at all – is not and cannot become ad-enabled

“Appearing in the ad space next to compromising content is hugely damaging for any brand and, by standing by and allowing it to happen, the big-platform media owners are neglecting their responsibility to do the right thing by the valuable customers who buy ad space with them.

“The time has come for the Googles and Facebooks to stop marking their own homework, and allow specialist, third-party auditors inside their walled gardens – to verify the viewability, non-human traffic and brand safety scores they send back to clients. Only then will we truly break the back of the ad fraud problem.”

Hornby’s crusade invites the old response “he would say that wouldn’t he?” as there’s clearly a commercial advantage for m/SIX in all this but, then, that’s his job. Hammering Google and Facebook is also straight from Sir Martin Sorrell’s WPP hymn sheet (WPP owns 49 per cent of T&P). Similarly Adloox has business to gain although it’s hard to argue with their view that what we’re seeing is “digital bank robbery.”

The ‘What Happens Next’ report was conducted by Adloox across 200bn daily bid requests and 10bn ad impressions per month, over a period of 12 months.

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