Fraud is one of the most significant problems in the digital advertising industry. It’s a world of ultra-high speed, online programmatic advertising, where transactions are completed in a blink of an eye and rooting out criminals has to be done even faster.
But a new global study indicates digital marketing professionals are ready to attack the problem now, and many are willing to move applications to neutral data centers to do it.
A key weapon in the fight is low latency, which enables parties in the online bidding process to connect quickly, giving anti-fraud analytics a greater opportunity to root out illicit activity before the bidding ends. In a survey that Equinix completed in collaboration with the marketing and advertising research firm ExchangeWire, one-third of marketing and advertising professionals were willing to move applications to secure ecosystems in a new data center if they could see an 11%-30% latency reduction.
This aligns with what we’re seeing at Equinix. As cyber criminals have become more sophisticated, our customers are increasingly demanding reduced latency times. And we can deliver that to the digital ad industry through direct connections to all the major players inside our online advertising ecosystem – called Ad-IX.
When we provide customers with a fast and secure platform to directly interconnect with leading ad exchanges, media buyers, data platforms, data aggregators and major networks, latency times are reduced and the risk of fraudulent activities is mitigated. In addition, we’re adding anti-fraud managed services to our ad exchanges, so customers can take additional measures to secure their business environments.
Fighting Fraud Now
A study by the Association of National Advertisers and White Ops Inc. projects digital advertising will be a roughly $48 billion industry in 2016, and a full 15% of it, or $7.2 billion, will be based on fraudulent activity.
Fraud is executed by criminals who use their own traffic bots to create a marketplace where large numbers of ad transactions are fake. For instance, a malicious publisher could use traffic bots to repeatedly call a Web address that contains an ad slot, so advertisers pay the publisher for fake ad impressions.
The Equinix/ExchangeWire report, which surveyed 129 digital marketing professionals, indicated respondents were making a significant drive in the next 12 months to create “clean” inventory data ecosystems – where ad impressions are known to be generated by real users, not bots.
The report also indicated that survey respondents globally are focused on fighting fraud at the pre-bid stages of programmatic advertising. Eighty-three percent of respondents in Latin America and 80% of EMEA respondents said it was very important or essential to detect fraud before ad impressions are sent to be traded. The numbers were lower but still significant in Asia-Pacific (74%) and the U.S. (61%)
Some other notable results from the survey:
- In Latin America, reduced fraud levels were cited as the main advantage of using a neutral data center with secure ecosystems. Reduced fraud was seen as the second-most important advantage in Asia-Pacific and the U.S.
- Respondents in EMEA, Asia-Pacific and the U.S. cited media buying efficiency as the biggest advantage of using a neutral data center with secure ecosystems.
At Equinix, we recommend an interconnection-first strategy as a critical step toward both fighting fraud and achieving better buying efficiency. By implementing an Interconnection Oriented Architecture™ (IOA™) inside any of our 145-plus global data centers, customers can accelerate bidding, trading and fraud detection.
An IOA frees IT from corporate silos, so companies can get closer to the markets and players in the online advertising industry, for the high-performance interconnection needed to execute bids and reduce fraud.
Learn more about an Interconnection Oriented Architecture.
And read our white paper on how a “clean” approach to online infrastructure can reduce ad fraud.