Ad fraud is a serious concern to all digital marketers or businesses trying to utilize online ads for their business. This type of fraud is so subtle that it often goes unnoticed until it’s too late, and the company has spent a lot of money without getting anything in return. The threat is so significant that businesses are becoming more vigilant and looking for ways to verify their ads to ensure they don’t become a victim of fraud. Residential proxies are a good solution for helping businesses ensure their ads are displayed and performing the way they should. Let’s take a closer look at how proxies help businesses combat ad fraud.
What Is Ad Fraud?
Businesses can utilize a few different types of digital ads online. Businesses pay according to how often an ad is clicked on (PPC) or for the number of impressions or views (PPM) the ad gets. Unfortunately, this structure makes it easier for fraudsters to manipulate the system for their own gain.
Ad fraud occurs when an individual falsifies the number of clicks or views on a specific advertisement. The business feels that its ad is getting views, which will soon translate into sales. However, in reality, all that’s happening is that the fraudulent publisher is getting paid, while there’s no return for the business since the interactions are false.
Ad fraud is a significant concern for digital advertisers, and it is expected to get much worse before getting better. In 2023, 22% of online ad spend and 30% of mobile ad spend was lost due to fraud. It’s also projected that by 2028, $172 billion will be lost to this type of fraud.
As such, it’s becoming vital for businesses and marketers to implement mitigation strategies to prevent them from becoming another victim. A few types of mitigation strategies include using residential proxies to verify ads, along with fraud detectors to identify any invalid traffic or impressions.
Who’s at Risk of Becoming a Victim of Ad Fraud
Any business that makes use of digital advertising can be a potential target for ad fraud. Typically, these fraudsters will try to target companies with a larger marketing budget or companies they feel don’t have the necessary protections in place to discover the fraud.
Some of the industries most heavily affected by ad fraud include:
- Financial services
- Legal services
- Retail or e-commerce
Common Types of Ad Fraud
There’s no denying that fraudsters have gotten very good at what they do. As such, there are many different types of ad fraud used today. These can range from simple clicks all the way to more sophisticated domain spoofing. However, they all work in relatively the same way – faking interactions with ads to earn money while the business pays for it.
Let’s look at a few of the more common types of ad fraud.
Click Fraud
This is one of the most common types of ad fraud used in pay-per-click (PPC) advertisements. In this scenario, the advertiser would simulate fake clicks on ads, often by using bots, to make it appear that the ad is doing well. In the meantime, none of these interactions are real, and they won’t ever materialize into an actual sale for the business.
Cookie Stuffing
Cookie stuffing is a clever way for fraudsters to manipulate ad cookies to their benefit. Cookies are small pieces of code that get saved on your device. They can be used to track your behavior, and in the case of advertising, they can provide insights into the success of your ad campaigns. However, fraudsters can manipulate these cookies by inserting a different cookie from another website to change the attribution and payment model of your advertisement. Additionally, they can also place your cookie on bots to make it appear that your keyword is getting more impressions than it is.
Domain Spoofing
In this case, fraudsters create websites that impersonate a high value domain. Since marketers and companies believe they’re placing their ads on a high-ranking site, they’re often willing to pay a premium. However, in reality, this isn’t the real deal, and often, these sites don’t have the traffic or quality to support the ad spend.
Pixel Stuffing
When fraudsters implement pixel stuffing, they display the ad within a single pixel. This, however, means that the ad is invisible to everyone. However, since the ad is technically displayed, it still earns impressions even if users aren’t aware of it. Using this method, fraudsters can run multiple ads on the same page, earning money from every impression even though these ads aren’t visible.
Ad Stacking
Ad stacking is the process that fraudsters use when placing multiple ads on top of each other. In this case, only the top ad is actually visible, but every ad in the stack still earns an impression. This is more commonly found on mobile devices.
How Can Residential Proxies Help You Verify Your Ads
Residential proxies are useful to marketers as they can help to verify your ads. Verifying your ads is the first step in ensuring you don’t become a victim of ad fraud. By verifying your ads, you can ensure they’re displayed correctly, visible to everyone, and function as intended.
However, verifying ads can be difficult for a few reasons. One, if your ads are displayed in a different location, you might not see them from your current IP. Also, fraudsters might even block your IP to ensure you don’t catch them defrauding your ads.
Residential proxies are a great solution to this since they offer a large pool of residential IPs linked to real devices. You can choose an IP from the location in which your ad appears so that you can see it precisely the way your intended audience will. Additionally, since these IPs look like actual users, it’s unlikely that they’ll be blocked, giving you a much better chance to verify your ads.
Final Thoughts
Verifying your digital ads is one of the first steps in ensuring you don’t become a victim of fraud. Using residential proxies for this purpose is highly recommended, as they help you avoid geo-restrictions, IP blocks and more. You can further ensure your ads’ safety by using a fraud detector once your ads have been verified.
