Defeating Ad Fraud: How to Protect Your Campaigns

In the world of digital advertising, ad fraud is a pervasive challenge, casting shadows over the integrity and effectiveness of online marketing campaigns. As advertisers allocate budgets to digital channels, the prevalence of fraud threatens to undermine the trust and investment in this dynamic industry.

What is Ad Fraud?

When advertisers purchase ad space on any platform, they expect real people to see their ads. If the ad is paid for but not seen by real people, we consider that ad fraud. Our ad technology is designed to avoid these fraudulent placements, regardless of the platforms where they typically occur.

From click farms to sophisticated bot networks, the realm of ad fraud presents a difficult issue where stakeholders must navigate complex algorithms and deceptive practices to safeguard their brands and investments.

There are many ways scammers trick advertising platforms. Fraudulent traffic, clicks, conversions, impressions, and others–all stemming from bot traffic. All of this harms the experience for real users by preventing content from being delivered to them.

These malicious bots are not only bad for the end user, but they are also bad for your company. While the bots farm fake engagement from your ads, you end up paying the bill to the publisher (typically whatever site your ads are serving on) for all of the clicks that don't lead to conversions for you.

The real danger is, you might not even realize your company is the victim of ad fraud. Ad fraud is difficult to detect, it might even seem like your ad campaign is a huge success with all of the engagement it is getting. This leads down the perilous path of increasing the budget for phantom stats while the criminals profit.

Why is Ad Fraud a Problem?

Ad fraud takes money out of the advertiser’s pocket, scamming ad dollars away by farming bot traffic. This is a detriment to the digital advertising industry at large as companies become less willing to invest in online mediums for fear of future fraudulent spend.

It's this hesitation that might pose the biggest threat to your company, online advertising is one of the most useful resources at any company's disposal, not investing could mean falling behind. If your company is small, online advertising is the most cost-effective way to get your message out there. The upfront expense for TV and billboard ads might not be possible while radio are less effective at increasing your online presence.

Fraud is also harmful to your end users. While many complain about the ads they see online, targeted ads are beneficial to people's online experiences. Targeted ads show relevant products and services based on the user’s interests. 

Pervasive ad fraud undermines trust and pushes advertisers away from online ads to other advertising mediums. It also harms the end-user experience by providing less relevant ads, which can lead to frustration.

Ad fraud affects everyone at every turn, the company creating the ad, the company distributing the ad, non-fraudulent websites that host ads, and the consumer who might click the ad.

How Prevalent is Ad Fraud?

In 2023, $382B was spent on digital advertising, over a fifth of the total expenditure vanished thanks to ad fraud. It is predicted that total digital ad spend lost to fraud will more than double by 2028. A little over 1 of every 5 dollars spent on digital advertising in 2023 ended up in the pocket of a fraudster. If you think your brand is safe or it can't happen to you, it can.

How to Avoid Ad Fraud with El Toro

At El Toro, we look at the advertising landscape completely differently. It all comes back to our core service: IP Targeting. Because we target a home on a 1-to-1 level without the use of cookies or device graphs, we can remove the primary vehicles proliferating online ad fraud.

Why our Tech Stack is Better Equipped to Deal with Fraud

One of the main reasons ad fraud persists is the use of cookies for online targeting. Cookies are little bits of data that can correlate to you, but are not you. Cookies can easily be spoofed since they are not tied to a real person. They are pieces of data that are targeting based on browser history (whether spoofed or real), and guessing what that cookie represents.

El Toro ingests over 3 million first-party, opt-in records every second to correlate physical addresses to IP Addresses and mobile advertising ids within a confidence interval in excess of 95%. With IP Targeting, we know we are delivering ads to a household. Every home that is connected to the internet has an IP address. When targeting an IP address, we are confident that real people across devices in their home are being reached.

What this Means for Our Customers

For our customers, all of this means you get a highly accurate, transparent, and traceable digital advertising solution. Because all of our data links back to a physical address, you can rest assured that your ad dollars are reaching real people and not lining the pocket of some fraudster. You can also have confidence that your ads are reaching the people you specify. With IP Targeting, we know exactly who we send ads to and correlate that to those who convert.

What to do About Fraud

From siphoning advertising budgets to harming the online experiences of potential customers, the ramifications of ad fraud are far-reaching. As the digital advertising landscape continues to evolve, combating fraud remains a top priority for advertisers and industry stakeholders. El Toro's IP Targeting solution offers a promising avenue for mitigating the risks associated with ad fraud, providing advertisers with greater confidence in the integrity and effectiveness of their campaigns. If you want to avoid ad fraud and run with the bull, contact us.