Stay on Top of Enterprise Technology Trends
Get updates impacting your industry from our GigaOm Research Community
Online ads have taken up residence on countless web pages, often infuriating users, while untactfully trying to get the “please buy my product” message across to potential customers.
Online ads, and associated online advertising campaigns, are projected to grow in frequency this coming year, despite a disturbing trend feeding the market. That trend, powered by a feedback loop based upon false metrics, will likely accelerate the populace of Ads while also tremendously weakening the value.
Those false metrics may spur a death spiral for online marketing ideologies, such as AdWords and ad links, resulting in a dramatic shift in how advertisers reach out to potential customers and even change the way how Ads are measured for value.
The catalyst behind that potential paradigm shift comes from the age-old problem of fraud, in this case, ad fraud. Even so, most still wonder how fraud can impact a well-managed advertising campaign, and others wonder if Ad fraud could have lasting repercussions.
“There are many different types of digital ad fraud” said Dr. Augustine Fou, an expert on Cybersecurity and Ad Fraud. Fou added “however, ad fraud has a different impact on advertisers than it has on end users.”
Simply put, ad fraud can impact customers by gathering personal information, or directing those customers to malware sites, or even become the catalyst for phishing attacks or identity theft. While for businesses, ad fraud creates a whole different set of liabilities.
Fou said “recent research shows that Ad fraud can be a lucrative proposition for those looking to benefit from it.” Fou added “ad fraud is at an all-time high“, and due to its ease of scale, growing exponentially. While those observations may give many pause, the simple truth of the matter is that those paying for ads will feel the most pain initially.
The issue for advertisers comes down to one of measuring value. After all, advertisers expect some return on their investments, and that return in the online world is measured by page views and impressions. Elements that are carefully measured, packaged up, and delivered to advertisers to assuage nervous budget managers.
However, far too much faith is being put into the statistics offered, simply because ad fraud has its roots in falsifying website traffic to inflate visits measured. That fraudulent reporting in perpetuated by “bots”, which in turn are programmed to effectively mimic human behavior.
In many cases advertisers are paying for ad impressions, which are actually fueled by bots. That creates a situation where the statistics are actually useless, and advertisers have become the victims of fraud, all without any accountability on the provider’s side. This in fact has become a lucrative business for many of those selling online Ads, one that shows crime can pay.
And therein is the real rub – advertisers keep pouring money into online advertising campaigns, only to see a rapidly diminishing return on investments. As this situation continues throughout 2017, marketing departments are going to start taking a closer look at how they spend their ad budgets, as they should, and online advertising will be seriously impacted.