The eye-watering new tab for ad fraud: US$42 billion

Despite relentless conversations over tackling what many call the advertising industry’s greatest threat, ad fraud is predicted to increase to US$42 billion worldwide in 2019, according to a new study from Juniper Research.

The number represents a 21% hike on the US$35 billion advertisers lost to fraudsters through online, mobile and in-app advertising in 2018. Even more concerning is the report’s prediction that the problem will get significantly worse, with ad fraud set to cost US$100 billion by 2023.

More advanced techniques in defrauding advertisers is the main reason for the rise, Juniper Research said in the study. “Fraudsters will gravitate to advanced techniques such as spoofing advertising networks to falsify ad clicks and displayed ads, rather than labour-intensive activities such as app install farms,” the company said in a release.

The increase is also attributed to smaller advertisers’ continued lack of use of anti-fraud solutions. With ad inventory forecast to grow faster than advertisers’ demand over the next four years, Juniper Research said: “Fraudulent players will look to fill this increasing gap between supply and demand by filling unused inventory with fraudulent ads”.

The company added that the next big target for fraudsters will be digital TV advertising through OTT services. Spending in this sector will increase to US$42 billion by 2023, but “a lack of standardisation amongst OTT TV services”, according to the report, means it will be easier for fraudsters to spoof ad networks through connected TVs, leaving advertisers exposed.

Sam Barker, author of the report at Juniper Research, said: “OTT TV service providers must address the issue of advertising fraud if they wish to attract high value advertisers to their platforms. These players must prove the value of advertising on their services by minimising exposure to ad fraud through the adoption of fraud detection and mitigation solutions specific to OTT TV solutions.”