You hear more and more stories about it. Advertisers are spending increasing amounts on digital, yet, in many cases, they have no idea where it’s going or if human beings are even seeing or hearing their ads. A new report by Borrell & Associates continues that theory as online fraud continues to climb and advertisers are getting duped in the process.
Borrell’s latest report finds that, on average, fraud accounted for 6.4% of digital ad spending last year. In some markets it’s nearly 10%. It’s become an $8 billion problem.
Fraud has affected local publishers large and small, some to the tune of millions of dollars. Borrell says “the use of ‘full stack’ programmatic advertising – where ad fraud is most prevalent – at the local and regional levels, has given cyber criminals a fresh and largely uneducated advertiser population to prey upon.”
The Borrell research shows that the most vulnerable categories are also some of the most “local” ones – real estate advertising, restaurants, and its recruitment advertising. New York, L.A., and Chicago are being hit the most with fraud in the larger markets. In smaller markets, it’s New Haven, CN, Hagerstown, MD, Bend, OR, and Portsmouth, N.H., feeling the online fraud pain.
Borrell says fraud will grow from $8 billion in 2016 to $11 billion in 2018.