In order to avoid becoming victims of online video fraud, brands need to institute internal screening methods and utilize technology from third parties, experts say.
A recent Wall Street Journal report shed light on the world of online video fraud, revealing that part of the problem is that brands don't always know where their ads appear.
"Lured by the promise of advertising they could be sure was being seen by the right people, marketers are now contending with a deep bag of tricks that includes Web-crawling robots, server-based 'drone pools,' and the pixel-size video sites that has them paying for dubious Internet traffic," Mike Shields and Christopher S. Stewart wrote in the WSJ earlier this week.
Large brands such as JP Morgan Chase, Coca-Cola's Minute Maid orange juice, and HTC Corp. fell victim to these "dubious" practices. So what are digital marketers to do?
For one thing, brands should use technology from providers like digital advertising security firm White Ops, digital performance company DoubleVerify, and media valuation platform Integral Ad Science, says senior digital strategy adviser Augustine Fou.
But that's not enough. Those players haven't completely solved the problem, so advertisers must also be cognizant of not buying from shady sellers and they must insist on getting placement reports of where their ads are placed.
"If they refuse to give it you, don't buy from them," Fou says.
Fou also recommends changing the calculation of return on investment (ROI) from more ad impressions at a lower cost to something that actually tracks back to ROI, like sales.
"You have to balance reach with quality," Fou says. "More reach sometimes means you will get into low-quality sites, so reach is not everything because if a human did not see it, it is useless to you."
Dan Slivjanovski, senior vice president of Blinkx, an Internet media platform that connects online video viewers with publishers and distributors, agrees.
When audiences are aggregated at scale at enormously high volume, there's "a hell of a lot of volume for the advertiser on the demand side and they get very efficient pricing because inventory is bought in an automated fashion, where pricing for impressions adheres to the supply-demand efficient frontier," he says.
However, as soon as aggregation happens in the programmatic ad world, advertisers don't have primary control over their audiences, so they have to rely upon a screening methodology or use an external third party for verification to make sure there's no fraudulent activity.
On the supply side, because partners don't necessarily own or originate traffic, there's an opportunity for bad players to arise.
"There's an ongoing race to evolve screening and filtering methods to catch fraudulent activity in real time," Slivjanovski says.
The best way is for participants in the value chain to have their own processes for filtering and optimization, in addition to partnering with best-in-breed third parties like Integral Ad Science, which is the way the industry is going, Slivjanovski adds.
Third parties that verify campaigns also include comScore, Nielsen, and DoubleVerify. They look at campaigns and audiences and render an impartial judgment and "typically money is not exchanged until a judgment is rendered and the campaign is verified," Slivjanovski says.
Slivjanovski even calls for a convergence of standards among industry players, leading to a common yardstick for verification and viewability within the digital advertising ecosystem.
In addition to being verifiable, online video ads also need to be viewable. Slivjanovski says the IAB recently issued standards around viewability, including that 50 percent of pixels have to be viewable for two seconds.
"It takes away from the subjectivity in terms of what's viewable and what's not and we think it's a significant step in the right direction," he says. "It's a nascent industry and moving so fast it feels like the standards are catching up to what's happening in that evolution."
In addition to ClickZ and Search Engine Watch, Lisa's work has appeared in The Huffington Post, The Luxury Spot, LearnVest, MarthaStewart.com, GoodHousekeeping.com, amNewYork, and The Wall Street Journal. She's a graduate of Columbia's School of Journalism.
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