Online advertising fraud out of control

Financial Times: Online advertisers are starting to wonder “what exactly they are paying for”. Although digital marketing is “vastly more efficient” than conventional advertising, because online ads on social media or websites can be tightly targeted at specific audiences the level of click fraud has brands asking if online ads are really worth the money.

More ad dollars will be spent online than on TV for the first time this year but some advertisers “smell a rat.” About 70 percent of marketing executives say they’re dissatisfied with the state of digital marketing, according to the Interactive Advertising Bureau.

The chief brand officer of Procter & Gamble, the world’s largest advertiser, even “came close to accusing the digital industry of perpetrating a massive con” at the IAB’s annual conference in January. The problem is that no one really knows if online ad campaigns are effective. “An ad can flash up on a screen for a fraction of a second and be counted as a view, or ‘impression,’ at which point the media owner and agency take their cut.” Never mind that 37 percent of ad impressions come from bots , according to the Association of National Advertisers. Yet web advertising giants like Facebook and Google refuse to commit to shared standards for audience measurement, “as TV companies did years ago.” Tech titans got rich exploiting advertisers’ naïveté. “That may be about to change.”

So what’s really going on here?

1ne: Too many advertisers using programmatic online ad buys and removing the “thought” and “human analytics” from online advertising.

2wo: While many organizations are adding analytic people, analytics have to evolve beyond just data dumps.  They need to “tell a story” and indicate what is happening and why.

3hree: Cost of online ads need to be reevaluated.  Impressions don’t mean a damn thing and online marketers need to look at things like “cost per targeted action” and “cost per page views”.

 

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