Report: Google steps up fight against fraud, and its findings are alarming

Dive Brief:

Google has quietly been working with media partners including CBS, NBCU and The New York Times to run tests designed to uncover fraudulent digital ads sold programmatically, according to a report in Business Insider.
The tech giant is leveraging ads.txt, an industry initiative first rolled out by the Interactive Advertising Bureau (IAB) in May with the purpose of bringing clarity around programmatic functions. Google is specifically looking to root out domain "spoofing," which is when bad actors buy cheap media space on low-quality websites and then list that space on programmatic exchanges as though it's actually premium inventory.
For the tests, Google has media partners turn off all programmatic ad inventory for a short time — 10 or 15 minutes, Business Insider said — and then searches programmatic exchanges to see if inventory on those premium websites is still listed. The results from these tests have uncovered a widespread issue, with thousands to millions of video and display ads being found on exchanges despite no ads being available for sale at the time. Affected exchanges include Google's own AdEx exchange, as well as AppNexus, Oath's BrightRoll and PubMatic, according to Business Insider.

Dive Insight:

For a digital advertising industry with ever-mounting concerns about transparency and fraud, the findings from Google's initiative will do little to quell fears and only serve to reinforce the deep flaws that have recently become apparent in the programmatic space, in particular. As the trustworthiness of digital advertising continues to hit road blocks, many major brands, and notably Procter & Gamble, have adjusted their strategy this year to demand a clean up of the digital media supply chain, in the meantime realigning budgets toward more traditional channels like TV.

Findings from MediaRadar published earlier this month found that, despite earlier forecasts, programmatic buys were down 12% in Q1 compared to the same period in 2016, with the group citing wariness over brand safety and fraud. A few standalone cases, including when JPMorgan Chase drastically cut back the number of sites serving its ads programmatically with little change in impressions, have reinforced a need to rethink marketing strategies with the technology to ensure it's effective and worth the investment.

Google taking a more active role by leveraging tools like IAB's ads.txt is a step in the right direction, but a strong onus is on marketers, agencies and ad tech players to play their part in the fight as well, according to commentary provided to Marketing Dive.

"Issues of transparency have continuously plagued the advertising industry over the last year. While many lofty statements have been made by brands and agencies alike, marketers still need to reclaim power and embrace technology that can give them what they want — transparency, efficiency, effect and speed — rather than settling for the opaque and antiquated services that they receive today," Henrik Busch, managing director and co-founder of Blackwood Seven, said in an emailed statement.

"Ultimately, the industry has hit a roadblock — with no real disruptions made in the last 10 to 15 years," he added. "If there is to be any positive changes among transparency and fraud issues, it is vital that advertisers take ownership of their ad technology, and together with publishers, continue to push for better industry standards."