New report reveals how advanced fraud protection successfully protects advertisers’ budgets
- 2.85% overall average fraud rate in 12 months following the launch of DataXu’s fraud-free initiative in January 2015
- Future fraud trends include impression arbitrage, rapid auto refresh and below-the-fold video
April 4, 2016—Boston, Massachusetts – DataXu, a leading provider of programmatic marketing software, today released a full year of data around its 97% Fraud-Free Guarantee in the first installment of its Programmatic Quality Report Series, The 2015 Advertising Fraud Report. The company analyzed all campaigns run through its platform, revealing that DataXu successfully limited fraud to an average rate of just 2.85% in 2015, compared with average industry rates of up to 30% on open exchanges, 17% on networks and 7% on publisher direct buys.
Intel from DataXu’s marketing analytics platform shows that the software company’s Fraud-Free Guarantee saved brands $150,000 per day. It contributed to a 14% decline in overall CPAs and a $0.57 reduction in CPM. DataXu saved its customers a total of $54 million overall in 2015, at zero additional cost to brands or agency customers.
“As fraudsters become more innovative, so too must marketers. The 2015 Advertising Fraud Report shows that ad fraud affects every part of the ecosystem and is only set to increase and become more sophisticated in the months ahead,” said Mike Baker, DataXu CEO and Co-Founder. “We hope the data presented in this report inspires more industry initiatives like DataXu’s Fraud-Free Guarantee, as well as renewed commitment to cross-industry anti-fraud collaboration in 2016 to protect brand and agency customers from the waste and detrimental effects of fraud.”
After switching over to work with DataXu, one automotive advertiser saw a 75% reduction in CPA, which dramatically improved from $1,402.82 to $333.12 over the course of 10 months. DataXu’s report shows that the automotive sector was the most severely affected vertical on the open market. In 2015, the automotive vertical experienced average fraud rates of 22.8%, followed by CPG (18.5%), telecommunications (14.8%), finance and entertainment (both 12.1%), alcohol (9.5%), retail (8.7%) and tech (8.2%).
Fraudsters continue to expand their reach by adopting new fraud techniques such as impression arbitrage, rapid auto refresh and below-the-fold video. Fraud tends to follow areas where ad spend is rising, meaning mobile and video fraud rates are likely to increase in 2016.
Although fraud is hurting most players in the space, Baker states, “The challenges of fraud are bringing the industry together, as the IAB champions the TAG registry and continues to develop the Payment ID system. Exchanges such as Yahoo!, OpenX and LiveRail are actively cracking down on fraud. In April 2016, TubeMogul is set to follow DataXu’s example to become the second buy-side platform to offer a fraud guarantee. We welcome all productive contributions towards tackling the issue of fraud and are proud to be the leader in this space.”
DataXu’s new data-based fraud report offers tips for marketers to combat fraud, such as scrutinizing fraud-free offers to ensure they cover an advertiser’s entire investment in programmatic, with a guarantee measured by an independent third-party with accreditation from the Media Ratings Council.
The full 2015 Advertising Fraud Report can be downloaded here.