When a company puts up a billboard or an ad on the bus, they don't care if the ad is seen by dashcams and dogs. All that matters is impact on the bottom line.
Remember what matters is how the ad affects the bottom line. Everything else is just a proxy - you need to check to see if your proxies are good enough.
But within their advertising market, you compete for placement with other advertisers. If everyone is getting lots of fraud traffic, presumably they adjust their bids for it, if you're getting outbid consistently, it's reasonable to expect that the other advertisers are either getting a better ROI or they have a lower ROI target than you do.
About a million years ago, I was on a team that had a significant ad program, and it was primarily data driven, we'd come up with keywords to advertise on, measure the results and adjust our bids. With a little bit of manual work to filter out inappropriate keywords or to allow a lower ROI on "important" keywords. Of course, our revenue was largely also from advertising, so it was a bit circular.
Effective advertising depends on iterative testing, which is very hard if the signal to noise ratio is way off.
If you display ads on your website, then sure, it doesn't matter if a bot or real person viewed/clicked on your ad if you get paid regardless - to the point where there's a big industry of putting ads on sites then having bots engage with the site and its ads.
Billboards are a bit different because that's paid per week / month, but internet ads are paid per impression or click.
they also don't get charged retroactively for each dashcam and dog that looks at the billboard
You aren’t paying for conversion rate, you are paying for a link being put on a website when a query is made. You can’t control whether a bot follows that link. You can’t control how sophisticated that bot is. You can’t expect an advertiser to filter out every type of illegitimate traffic (although it sounds like they probably have the capability to filter out more but don’t have any incentive to do so).
I have seen recommendations from across the Internet to not bother with Google ads and other similar paid ad services. It’s basically like paying for a cold lead, you’re attracting one of the least interested types of customers.
The recommendation I’ve always seen is that it’s better to build legitimate interest in your product by producing content. Or perhaps move to an advertising platform where there’s more of a guarantee of reaching human users.
But still, I’ve heard that trying to spend customer acquisition dollars on one-time purchases is a losing battle.
If Tesla was able to start a massive car company without buying ads you can go without AdWords, too.
Google Ads used to be very effective. You are catching the punter as they are actually looking for a solution to their problem. However Google have inflated bids and increased the complexity to the point where very few people can make a decent return now.
>The recommendation I’ve always seen is that it’s better to build legitimate interest in your product by producing content.
That is becoming rapidly less true as AIs steal all the traffic.
>If Tesla was able to start a massive car company without buying ads you can go without AdWords, too.
We can't all be Teslas.
But it's incredibly unlikely that the amount of fraud is stable, any attention from a small player can generate enough volume to eclipse all of the background. Thus no, you can't just account for it on your calculation.
When a company puts up a billboard, it doesn't get taken down because a flock of birds passed by before anyone could look at it.
Billboards sell for flat rates, online advertising is sold on the basis of impressions.
Contrast the billboard with an online ad: If you pay for 10,000 impressions, and 9,000 of those impressions end up being automated traffic, then you’ve effectively lost 90% of your advertising budget. Like you mentioned, ad buyers can and do account for this, so it’s not clear that it’s as big of a problem as this thread is making it out to be. The theory I see thrown around is that Meta and Alphabet are tacitly allowing this bot traffic to continue (or even that they are responsible for it themselves) because it allows them to sell another round of ads, but if this is what is going on it isn’t clear why firms would keep buying ads that aren’t converting.
Uh, yes.
If you get 47 sales on $10k in ad spend (pay per click) and $9900 of that $10k was fraudulent then you got 47 sales on $100 of ad spend. Imagine if you could stop those fraudulent clicks.
You can’t stop fraudulent clicks just like you can’t stop your SuperBowl ad from playing while your viewers are in the bathroom. How much of ESPN’s viewership happens at bars where nobody is watching?
At some point it’s not reasonable to expect ad networks to be able to stop sophisticated bots or exclude them from your billed impressions.
They should definitely try to minimize it if they want to maintain the value of their impressions but I think there is a good argument that OP just isn’t the right customer for this type of advertisement.
If you’re trying to sell a t-shirt you don’t hire a salesperson to cold call people, maybe OP shouldn’t be using web ads in the first place. If fraud was cut down by half would their situation really be that much better?
It does, because it changes the strategy.
If you think the ads are working and have 10k potential customers then you start thinking about how to increase your conversion rate thinking you could get a chunk of those 10k, you might think distribution is solved.
But if it turns out only 2.5k are real humans then your conversion rate might not even be an issue and it’s just the marketing strategy that needs tweaking.
The whole point is that they are giving you fraudulent traffic which you use as real data to figure out the next steps. If you don’t know it’s fraudulent or how much of the clicks are fraudulent then you are taking decisions under the wrong assumptions.
> You can’t stop fraudulent clicks just like you can’t stop your SuperBowl ad from playing while your viewers are in the bathroom
That’s not even a good analogy, we are taking clicks, not impressions.
Yes, you literally can stop fraudulent clicks. I'm not sure where you get the idea that it's not possible?
This is nothing like the Super Bowl analogy.
The point here, for me, is that a microeconomic perspective on this whole question is more salient than a purely technical one.
Fake clicks give the illusion that ads are working and instead you have to optimize your funnel or whatever else.
The online ad market is extremely inefficient because it has no idea how much ad spend is even reaching people.
I am fine with spending $10,000 on ads (or whatever amount).
The issue is that when I know $5,000 of it was spent on clicks that had 0% chance to convert. For every fraudulent click I can block/prevent that is one more click that can be made by a real person who may actually make a purchase.
Your calculations make as much sense as pouring out 90% of a can of beer, claiming you have just made vodka, and simultaneously trying to pay only for the 10% of beer that is left.
The entire premise of the article is quite accurate and most companies are spending money on third-parties to do what this guy has done to recoup fraudulent spends; so, none of this is new to the industry. Everyone knows it's happening and it's all part of the gig; it benefits everyone except those spending so little is truly done to correct it.
It is the ad network's problem because they are showing ads to all those bots which costs them. It is also the ad networks problem in that they are not effective - maybe for your $10k for 47 sales is good enough, but for most it isn't and so they lose customers who pay attention to value. It is also their problem in that by giving a false number of views they lose some face, but this is always a proxy that isn't of much value to anyone.
The more important thing that is your problem is verifying the ads are worth it. How do you know the ad resulted in 47 sales. A large number of adds should be buy this in the future not today, and thus clicks are the wrong measure.
You do understand that when I stop/reduce the fraudulent clicks that leaves extra ad budget available to be spent by clicks from real people who will actually buy things.
I have 0 incentive to not work to stop/reduce the fraudulent clicks. My ad spend stays the same but my sales go up.