If you advertise online, you might know how much fraudulent traffic is there. In 2017, digital ad fraud was measured at $16bn, whereas in 2018 this figure increased to $19bn. To compare, this is as much as WhatsApp cost Facebook. However, blockchain can reduce this waste, and this post describes how.

Where Digital Ad Fraud Hides

Although there are many options to cheat advertisers, the most ubiquitous are four of them.

1. Non-human Traffic Eats Away Ad Budgets

Unfortunately, digital ad agencies cannot guarantee there’ll be only ‘healthy’ traffic. And you can’t really expect to generate leads among clickbots.

Let’s dig deeper and look at the tools behind non-human traffic gobbling up ad budgets:

Bots clicking away all the ads they come across while crawling the web.

Software automatically clicking ads to boost the income of ad publishers.

Hacked software used by malevolent third parties for profit.

2. ‘Ad Stacking’: How to Display One Ad Yet Charge a Few Advertisers at Once

Another option for ad publishers to cheat is to sell the same ad inventory several times. It means that a few different ads will be placed one over another with only the top one visible to website visitors. Yet, all the advertisers will be charged despite the fact that all but one were fake impressions.

Just to understand how big the problem is, it’s enough to say that in 2017, 80% of ad inventory in Japan used stacking.

3. Pixel Stuffing: One-Pixel Ads

If your ad is the size of a pixel, it’s unlikely anyone will see it. At the same time, advertisers don’t have mechanisms to detect such fraud and still have to pay for impressions fully.

4. Pop-unders and Auto-page Refreshes

Website owners that charge advertisers for ad impressions are interested in displaying ad as many times as possible. Among the ways to generate fake impressions are pop-unders and auto-page refreshes.

Pop-unders show ads in separate windows under the opened one, so nobody sees it but impressions are still counted. Auto-page refreshes keep refreshing the page to add up impressions, which has no value to the advertiser.

Blockchain Steps Up

Blockchain and AI Can Detect Non-Human Behavior

As blockchain stores data in an append-only way, it keeps all the data about visitors’ behavior. Being decentralized, blockchain data can’t be forged. It means that blockchain-backed artificial intelligence could use these datasets to learn how to distinguish and block computable traffic automatically.

Smart Contracts to Power Ad Transactions

If payments between publishers and advertisers are carried out by smart contracts, advertisers won’t be charged for the ads placed on the wrong page or served in a one-pixel frame. It’s possible to include as many payment criteria in smart contracts as required.

How to Get Ahead with Blockchain?

If you have ever come across fraud in digital advertising, you might be craving for the solution to this problem. Here is where blockchain comes in.

As an advertiser, you can use blockchain-led software to guarantee traffic authenticity and thus keep fraud at bay.

As an advertising agency, you can design your own anti-fraud solution on top of a blockchain ecosystem, such as genEOS. The platform will speed up your blockchain software development by delivering built-in features like smart contracts, real-time reports, and traffic fraud prevention tools. This can help you stand out in the advertising market through better care about your customers’ budgets and integrity.