Ad Campaign Frauds Continue to Haunt Marketers

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With a rise in media consumption over the past few years, celebrities and influencers are becoming an increasingly popular choice for advertising campaigns and brand building. 

The price of these public figures is costing brands big money, but without the right precautions in place, companies could be losing up to 26% of their ad spend due to ad fraud. 

More and more companies are using big budgets on costly ad campaigns which aren’t providing new customers, users or ROI. Digital marketing is becoming increasingly complex with the rise of AI, delivering solutions as well as challenges. With a large chunk of marketers saying they use over 40% of budget on influencer marketing, companies must ensure they have appropriate precautions in place to hold ad fraud at bay.

Every Click Counts

In today’s tough economy, businesses need to make every click count. They can’t assume that all traffic from their pay-per-click (PPC) campaigns or new AI-driven ads are from real leads. Fraudulent and invalid traffic is becoming more common, reducing campaign effectiveness and causing significant revenue losses. As consumers tighten their wallets due to a reduction in discretionary spending, it’s more important than ever for advertisers to connect with genuine potential customers and avoid wasting their budgets on pricey influencers without the right protections in place first.

A recent report from Juniper Research shows that a staggering 22% of all digital ad spend in 2023—around $84 billion—was lost to fraud. If we don’t tackle this issue, it could skyrocket to $172 billion by 2028.

Invalid traffic (IVT) and ad fraud can seriously damage campaign ROI by creating the illusion of real traffic. This is especially frustrating for digital marketers, who struggle to gauge the quality of their traffic while fraudsters manipulate campaign data.

As businesses invest more in influencer marketing, ads are becoming prime targets for invalid traffic. Instead of cutting budgets, organisations should focus on analysing their campaigns’ effectiveness and efficiency.

Bidding on Brand Keywords

When businesses spend on influencers, they are often forced to bid on their brand keywords to prevent competitors from stealing potential customers who search for them. 

Google has significantly increased the number of search ads over the years, pushing organic listings further down the page. For instance, in 2016, Google introduced a change that increased the number of ads at the top of search results from three to four. By 2020, the number of ads in a single search results page could be as many as seven, including both top and bottom placements. This increase means users often must scroll through multiple ads before reaching organic results.

This increased competition for brand keywords means businesses are serving ads to their existing customers, depleting their campaign budgets without driving new revenue. According to a study by WordStream, companies can spend up to 29% of their PPC budget on brand keyword bidding, often leading to no new net revenue.

Performance Max (PMax) and the Black Box Algorithm

Google’s Performance Max (PMax) algorithm is designed to optimise ad performance by automatically distributing ads across Google’s inventory, including YouTube, Display, Search, Discover, and more. However, this AI-driven approach can lead to significant challenges. One of the key issues is PMax’s tendency to bid on branded keywords in search campaigns to achieve the best results, sometimes bidding much higher than what your standard CPC was on standard search. While this might seem beneficial, it can actually cannibalise the performance of dedicated search campaigns, diverting traffic that would have come organically or through less expensive channels.

Moreover, PMax operates as a black box algorithm, meaning advertisers have limited visibility into how it allocates budgets and optimises bids. This lack of transparency can make it difficult for marketers to understand where their ad spend is going and to identify instances of IVT or ad fraud. Consequently, businesses might see inflated engagement metrics without corresponding increases in actual customer conversions, leading to inefficiencies and wasted budget.

Tidy Traffic = Tidy Profits

Before launching expensive ad campaigns, companies should take a step back and assess their ad fraud protection services. IVT is traffic from non-human sources or that doesn’t contribute to growth. Fraudsters exploit this, often unnoticed. AI-driven campaigns like Google’s Performance Max (PMax) aim to boost marketing efficiency but struggle to spot fraudulent activity. AI treats all user engagement as positive, allowing fraudsters to slip through and mess with campaign data.

This “dirty” traffic holds back growth by skewing campaign data, leading to wasted efforts and lost profits. Without proper traffic analysis, advertisers risk depleting their budgets without realising it, diverting funds from other important areas like influencer campaigns. By filtering out fraudulent activity, businesses can maximise the potential of their digital ads and boost revenue.

Protecting Profits from Invalid Traffic

Return on Advertising Spend (ROAS) is key for measuring the success of paid campaigns, especially those led by influencers. To maximise ROAS, optimising ad budgets and implementing fraud prevention solutions are crucial.

Here are some steps to enhance preventative measures and achieve a higher ROI:

• Analyse and Optimise Campaign Traffic: Fraudsters use bots to generate IVT, which AI platforms often miss. Using analytics and reporting tools to spot irregular patterns can help block false engagement and optimise ad spend on real traffic.
• Improve Audience Signals: Accurate targeting is vital for conversions. Refine audience signals to exclude IVT, allowing AI to better tailor ads to the right audience.
• Enhance Initial Security Measures: Implement strong security measures before launching expensive campaigns to ensure your ad spend attracts genuine customers.

By taking a proactive approach to fraud prevention, organisations can protect their investments and unlock bigger budgets for future campaigns.

Securing Costly Campaigns

Influencer and celebrity campaigns have proven useful tools for reeling in new customers, fans, and profits. However, without essential precautions in place, marketers are seeing more and more of those hard-earned targets stolen by fraudsters. 

Companies must consider implementing ad fraud solutions before launching costly ad campaigns that are at risk of exposure to fraudulent interest.