The Dark Side of Connected TV Advertising: Tackling Fraud for Industry Growth and Protection
Fraudsters Inflate Impressions as Advertisers Navigate the Wild West of CTV Connected TV (CTV)
advertising has emerged as a powerful force in the advertising landscape. With ad spend on the rise, CTV presents an enticing opportunity for advertisers to reach consumers on the big screen and drive action on mobile devices. However, beneath the glitz and glamour lies a troubling issue: CTV ad fraud. As the industry continues to grow, it is essential to tackle this problem head-on to ensure sustainable growth and prevent potential exposes and lawsuits. According to a recent study by DoubleVerify, CTV ad fraud saw a staggering 69% increase in bot fraud in 2022. The report analyzed trends from billions of media transactions across the globe, revealing a concerning growth in fraudulent activities targeting CTV advertising. Fraudsters employ deceptive tactics, such as using bots or fake CTV devices, to generate revenue by falsely inflating video ad impressions. Advertisers end up
paying for non-existent or unviewed ad placements, undermining the effectiveness of their campaigns. Global digital advertising losses due to fraud were estimated at a whopping $68 billion in 2022, with up to 30% of CTV ad impressions believed to be fraudulent, according to Juniper Research. This alarming statistic highlights the urgency of addressing CTV ad fraud to protect advertisers'
return on investment (ROI) and ensure the industry's long-term viability. Challenges and Complexity: CTV advertising can be quite challenging for advertisers due to its relatively new nature, lack of established best practices, regulations, and industry standards. The
ecosystem's complexity can further complicate matters, making it difficult for advertisers to target their audiences effectively, cap the frequency of their ads, and measure their campaigns' success. Unlike mobile advertising, where audiences are mainly divided between Android and iOS, CTV platforms vary significantly, and households often use multiple devices. Advertisers must navigate a vast array of CTV platforms, streaming services, and intermediaries, which can lead to inconsistencies in
data and increase the risk of fraud. This situation underscores the need for a more unified approach to CTV advertising, with industry stakeholders working together to establish best practices, regulations, and standards that can help streamline the advertising process and reduce the risk of fraud. The Urgent Need for Action: To combat CTV ad fraud effectively, robust fraud mitigation strategies require close collaboration across the entire CTV ecosystem. CTV operating system (OS) owners can play a crucial role in mitigating fraud in the Server-Side Ad Insertion (SSAI) workflow, which accounts for approximately 50% of CTV impressions today. Verification partners armed with advanced analytics and machine learning can help advertisers protect their campaigns by detecting and preventing fraudulent activity. By analyzing bid streams and campaign data, these partners can identify unusual patterns or anomalies that indicate potential fraud. The risks for unprotected advertisers are significant. DoubleVerify's
study revealed that campaigns without verification measures experienced a fraud rate of 11.2%, compared to only 0.6% for protected campaigns—an alarming difference of nearly 18 times. Protecting campaigns with verification becomes imperative to minimize financial losses and ensure accurate measurement of campaign efficacy. Tackling the Attention Deficit: In addition to fraud, the DoubleVerify report delved into attention metrics, highlighting an opportunity for improvement. It found that campaigns in North America, the most mature market, lag behind in their ability to grab viewer attention. The report's Attention Index indicated a real need for advertisers to enhance their strategies to captivate audiences effectively and maximize campaign
performance. This is also useful in preventing ad fraud is crucial for the advertising industry because it ensures that ad campaigns are reaching their intended audiences, rather than being wasted on fraudulent views or clicks. Attention metrics play a significant role in preventing ad fraud because they allow advertisers to measure the effectiveness of their campaigns in capturing viewer
attention. By understanding which ads are grabbing viewers' attention and which are not, advertisers can optimize their campaigns to better engage their target audience and avoid wasting ad spend on ineffective ads. The DoubleVerify report's findings highlight the importance of attention metrics in preventing ad fraud, as campaigns that fail to captivate viewers are more likely to be subject to fraudulent activity. By improving their attention-grabbing strategies, advertisers can not only
prevent ad fraud but also maximize the performance of their campaigns. The Road Ahead: As CTV advertising continues to grow, so does the risk of fraud. The industry must come together to establish best practices, industry standards, and robust fraud detection mechanisms.
Advertisers should prioritize collaboration with verification partners, leverage cutting-edge technologies, and demand transparency from the CTV ecosystem. By implementing these measures, the industry can protect advertisers' investments, maintain consumer trust, and foster the continued growth of CTV advertising. Transparency is a vital element in combating CTV ad fraud. Advertisers should
demand transparency from CTV platforms, publishers, and intermediaries regarding the origin and quality of their ad inventory. Clear communication and collaboration among stakeholders can help identify potential vulnerabilities and develop effective countermeasures. To address the challenges posed by CTV ad fraud, industry collaboration is crucial. Advertisers, agencies, CTV platforms,
verification partners, and industry associations must work together to establish best practices, guidelines, and standards. Sharing insights, data, and experiences can help identify emerging threats and develop proactive solutions. Educating stakeholders about the risks and impact of CTV ad fraud is essential. Advertisers should stay informed about the latest fraud tactics and prevention
strategies. Industry events, webinars, and thought leadership articles can provide valuable knowledge and insights. Advertisers can also collaborate with verification partners to gain a deeper understanding of fraud detection technologies and how to leverage them effectively. To combat CTV ad fraud, the industry must invest in advanced technologies. Machine learning algorithms, artificial
intelligence, and data analytics can help detect anomalies, patterns, and suspicious activities that indicate fraudulent behavior. Verification partners can provide advertisers with the necessary tools and technologies to protect their campaigns and optimize performance. Combatting CTV ad fraud is an ongoing effort. Advertisers should continuously monitor campaign performance, analyze data,
and optimize their strategies based on real-time insights. By closely tracking key metrics such as viewability, completion rates, and engagement, advertisers can identify potential fraud indicators and take immediate action. As the CTV advertising landscape evolves, regulatory bodies and industry associations may introduce guidelines and standards to combat ad fraud effectively. Advertisers
should stay informed about any regulatory developments and actively participate in discussions and initiatives aimed at protecting the industry and ensuring a level playing field. CTV advertising presents tremendous opportunities for brands to engage audiences on the big screen and drive impactful results. However, the rise of CTV ad fraud threatens to undermine this potential and erode
advertiser trust. By acknowledging the scope of the problem, investing in robust fraud detection measures, and fostering collaboration across the ecosystem, the industry can proactively address CTV ad fraud and create a safer, more transparent advertising environment. Only through collective action can advertisers and stakeholders ensure the continued growth and success of CTV advertising while protecting their investments and maintaining consumer confidence. |
All the news you need today, in a format that isn't TL:DR, summarized for the busy executive.
The Association of National Advertisers wants no part in the FTC's proposed "click to cancel" regulations, arguing that they'll hinder innovation and commerce without benefiting consumers. They claim the rules would cause frustration, burden businesses, and restrict communication with customers. The proposed
regulations aim to simplify canceling recurring fees, like subscriptions, by requiring a straightforward cancellation process and allowing cancellations through the same medium used for purchase. However, the ad group argues that the rules lack clarity, and single-click cancellations would lead to accidental terminations. They also believe offering cancellations through the same channels could be too restrictive. Another critic, the Interactive Advertising Bureau, raises concerns about stifling
legitimate companies, infringing on free speech, and not simplifying the cancellation process for consumers. All in all, it seems like canceling subscriptions might not be as straightforward as one click after all.
A federal appellate court has given new life to a lawsuit against Meta (formerly Facebook) by reviving claims that the company's ad-targeting options violated anti-discrimination laws. The court rejected Meta's argument that it was
protected by Section 230 of the Communications Decency Act, suggesting that if the allegations were true, Facebook could be considered a "co-developer" of the ads rather than a mere host. The class-action complaint, brought by Facebook users, alleged that the ad-targeting platform allowed advertisers to block housing ads based on factors like race, sex, and age. While Facebook had already revised its targeting options to address these concerns, the court ruled that the users' allegations
warranted further proceedings and that Section 230 did not shield Facebook from liability. The decision draws parallels to a previous discrimination lawsuit involving Roommates.com, stating that companies actively involved in developing unlawful material cannot rely on Section 230 protection.
Cannes, the fantastical realm of the advertising industry, is like a collection of parallel universes where we all play the role of non-player
characters. It's a place where media professionals reside in their own bubbly bubbles turned up to eleven. To understand how Cannes became the coveted summer gathering spot for the US ad industry, we need a history lesson. Once upon a time, the Lions were the snubbed international ad festival, overshadowed by the snarky ads of the cool kids. But then, the big American agencies started bringing clients to witness the "creativity" on display, as if their own work couldn't measure up.
Soon, Cannes morphed into a hub of overlapping bubbles, focused on ad tech and digital, while ironically buzzing with the term "AI," often used by those who barely grasp its true meaning. It's a world where "personalization" might conjure up creepy TV commercials tailored to your every desire, while in reality, it's about contextual clues and optimizing ads for the right moment. By day, panels spew forth their wisdom to largely empty rooms, while by night, extravagant parties and celebrity
appearances aim to impress ad buyers and secure those lucrative deals. It's a metaverse of advertising theatrics that's so, well, meta.
YouTube is coming to the aid of content creators with a new "Test & Compare" tool that allows them to split test different thumbnail variations and determine the winner based on watch time. The feature will be rolled out to a select
group of creators in the coming months. In addition, YouTube's 2023 Culture & Trends report highlights the evolving interests and behaviors of viewers. With 87% of surveyed viewers watching at least four content formats and 60% open to AI-assisted content, creators need to cater to personalized experiences, engage viewers at different levels, diversify their content outputs, and embrace AI-enabled creative possibilities. While this presents both opportunities and challenges for creators,
it's an exciting time to rise to the occasion and create captivating content across multiple formats.
In a positive turn of events, the US ad market saw a long-awaited increase of 2.5% in May, marking the first rise in 11 months and the best May performance since tracking began by Standard Media Index (SMI). This uptick may indicate a slow recovery from the
recession that began in July of the previous year, according to SMI data. Additionally, digital media continues to grow its market share, reaching 60% of the total advertising market—a 4% increase compared to May 2022 and a 9% increase compared to 2021. While these developments are encouraging, it's important to await further data to confirm if this is a sustained trend or just a temporary blip. Fingers crossed that the worst is indeed behind us, paving the way for a thriving market in the
second half of the year.
Email teams in the realm of ecommerce might be feeling a pang of worry as consumer spending remains stagnant in Q2. According to Jungle Scout's Q2 Consumer Trends report, a significant 73% of online shoppers purchased either the same amount or less compared to Q1, reflecting a similar pattern among 72% of consumers overall. The culprit behind this trend? Rising costs,
with 81% citing the impact of inflation on their spending habits. Financial concerns plague 63% of respondents, while 49% admit to having unstable household incomes. Women tend to be more anxious about family finances than men. Digging deeper, 11% anticipate significant online spending decreases ranging from 51% to 100%, while 10% foresee the same for all spending categories. On a more optimistic note, 23% expect to spend between 1% and 50% online, and 24% maintain a similar outlook for overall
spending. Cutbacks are most noticeable in areas such as dining out, fun/impulse purchases, clothing, leisure travel, and in-person entertainment. Home improvement, holiday-related expenses, personal care services, groceries, and streaming entertainment subscriptions also experience a decline in consumer spending. It seems that cautious wallets and shrinking budgets are currently ruling the spending landscape.
In an interview with TIME, Sam Altman, CEO of OpenAI, shared insights about the future developments of ChatGPT. Altman mentioned that future versions of ChatGPT will not only be able to output images but also input them, followed by the capability to handle audio and videos. He also emphasized the importance of making the models smarter and improving their ability to provide the best answers consistently. OpenAI aims to crack this research challenge to
ensure that users receive the best answers almost all the time, which would be a significant breakthrough for the technology.
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THE FUTURE OF PROGRAMMATIC: MATT BARASH DEFENDS THE SSP.
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CTV’S CAPTAIN FANTASTIC: MIKE SEIMAN AND THE RISE OF PERFORMANCE-DRIVEN TV
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