Ad fraud is a problem that affects both advertisers and publishers by cheating them out of their money and putting it in the pocket of bad players. Estimates for how much ad fraud costs the industry vary — I’ve seen the number between $6.5 billion to $19 billion annually, with one estimate at $12 billion for 2019 (subscription required). Even for digital ad spend, a $300 billion industry, it’s sizable.
As important as the monetary damage is the fact that ad fraud has been eroding faith between all parties involved in the adtech supply chain. Advertisers don’t trust agencies. Agencies don’t trust demand-side platforms. Publishers don’t trust supply-side platforms. Many entities are working to curb ad fraud, including ad verification vendors and industry associations like the Interactive Advertising Bureau Technology Laboratory (IAB Tech Lab), of which AdPushup is a member.
The Growth Of Ads.txt
Two of the most common types of ad fraud include domain spoofing and bad parties falsely representing publishers. In May 2017, IAB released the ads.txt spec (short for authorized digital sellers), under which publishers were instructed to keep a publicly available file listing all the ad networks, ad exchanges and supply-side platforms (SSP) that they work with. This allows advertisers to quickly check whether or not an SSP is authorized to sell the inventory that they are trying to sell.
Ads.txt also helps buyers with supply path optimization, reducing request for the same ad impression from multiple sources. Ads.txt has been widely adopted since its launch. In fact, in an internal analysis we did, 50 out of 50 publisher websites that we shortlisted from the Alexa Top 500 Global Sites list were using ads.txt.
Ads.txt has helped increase trust and transparency between publishers and advertisers, but it was never meant to fix all the ways in which ad fraud is perpetrated. Consider this: SSPs don’t always sell inventory directly. In fact, it may go through more than one reseller before being sold. The ads.txt file doesn’t list these resellers because the publisher may not even know about them. Moreover, according to a story published by The Wall Street Journal (subscription required), fraudsters switched tactics and began exploiting the information present in the ads.txt file to peddle spoofed inventory.
To counter this, IAB released ads.cert, which uses cryptographically stamped digital signatures to fix the security issues with ads.txt. To fill in these gaps and provide even better protection against ad fraud, the IAB released two additional specs in April this year: sellers.json and SupplyChain object.
Explaining Sellers.json And SupplyChain Object
Sellers.json is like ads.txt but for ad exchanges and SSPs — they can use the file to list all the publishers and intermediaries that they work with. This will provide buyers an even more extensive mapping of the complete supply path. Just like ads.txt, sellers.json is listed at the root of the tech platform’s domain, such as .com/sellers.json.
The SupplyChain object, on the other hand, is a record of what happened to every single impression as it traveled down using various routes from the publisher to the buyer. The file comprises a set of “nodes,” each representing a seller or reseller in the supply path. Buyers can also see the last reseller in the chain. By matching the seller IDs listed by publishers in the ads.txt file, buyers can determine whether or not the seller/reseller is an authentic partner.
Who Benefits?
Everyone except the people actually perpetrating ad fraud should benefit from the new specs. If buyers become more confident about the authenticity of the inventory that they are purchasing, they might be willing to pay more for it. Ads.txt provided limited protection against ad fraud and could be gamed, but that becomes harder to do with sellers.json and SupplyChain object in place.
In theory, when ads.txt, sellers.json and SupplyChain object are used together, they will provide buyers a previously unprecedented level of insight into the authenticity of every single ad impression that they are spending their money on. I believe initiatives like these will go a long way in reinstating the faith that has been lost between buyers and sellers in the advertising industry.
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