Ad Fraud in OTT and What to Do with It

User Rating: 5 / 5

Star ActiveStar ActiveStar ActiveStar ActiveStar Active

When OTT first made its appearance and media players discovered the possibility of ad exchange, everyone thought it would be a transparent process protected against fraud as it allowed for direct buys. But recent reports disprove that expectation.

According to Pixelate, the global OTT ad fraud rate was close to 19% in 2018 and may spiral into more than $10 billion in annual losses before 2020. Quite uninspiring, isn’t it?

Nevertheless, the demand for OTT inventory surpasses the supply many times. It means that regardless of fraud, people will continue to buy advertising programmatically. So, let’s uncover some loopholes for possible unfair marketing and how to counter them.

What OTT ad fraud is

Though in the early days of over-the-top broadcasting there was no ad fraud indeed, in the course of time quirky marketers have invented a number of tricks as to how to make money off invalid impressions. OTT fraud is very diverse and may appear in various forms, for example:

  • Displaying an impression at a non-target location or to non-target audience;
  • Showing an enormous number of video ads per minute (e.g., 30 different videos in 60 seconds);
  • “Broadcasting” advertisements to turned-off connected devices;
  • Spoofing devices for traffic theft.

Publishers that buy traffic from third parties with little possibility to trace the impression or conversion are very vulnerable to ad fraud. Therefore, fraudsters can sell inventory that doesn’t actually exist.

Why OTT fraud is on the rise

Over-the-top appears to be a honey pie for ad tech vendors thanks to the ease of access and opportunities it provides - the FANG guys have not yet fully dived hand into OTT. Smaller companies can still get their share in this large market.

It’s obvious that the number of fraud cases will also grow along with the ever-growing demand for OTT ad inventory. Video advertising is the sphere where the money is now and everyone knows it.

Another point that contributes to OTT fraud development is the absence of unification. Every app uses its own platform like Roku, Amazon, Hulu, Netflix, etc. Amid lack of standardization, every icky marketer can make a fake app look similar to an existing one and then make money off fair advertisers.

What to do with all this

One of the main reasons for ad fraud is the lack of transparency between media buyers and sellers. Lack of standardization and complicated process with lots of intermediate stages give enough wiggle room to fraudsters. The main point here is that due to the desperate condition of advertisers and their need for inventory, they will continue to elaborate this field.

So, there must be a solution to make their transactions safe. It should probably be a single platform that allows for easier and transparent communication between media buyers and sellers. This is where our Ad Exchange steps in. It is a solution created especially for Addressable and OTT TV. Our Adoppler Exchange establishes a secure and comprehensive environment for media sellers and buyers while also providing them with a customizable platform.

The platform is based on the industry standards but at the same time allows for creating a separate ecosystem fully controlled by the media seller. Rather than playing the blind game Robots vs. Robots, Adoppler Exchange will bring down the number of mediators and will make the process transparent to both Publishers and Advertisers.