Tech & Innovation

Rise in Retargeting Ads Fraud: All You Should Know

Rise in Retargeting Ads Fraud All You Should Know
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As technology continues to grow, the opportunities available in digital marketing are expanding. Since digital marketing has the potential to drive business growth, no one wants to miss out on these opportunities. As a result, companies are using different online channels in order to reach out to their target audience with less hassle.

Consumer consumption has always been an enthusiasm for marketers but also a challenging task as they walk through the journey of consumer attraction to consumer retention. Moreover, there has been a significant change in consumer behavior over the past few years. Consumers have shifted more towards eCommerce and digital technology.

They are more likely to research products online, compare prices, look for recommendations and reviews and then make purchases online rather than going to physical stores. This is likely to continue in the future, therefore, this scenario gives customers vast options to choose from. Hence retargeting this audience who rely on digital means becomes more crucial for marketers.

Therefore, we can say that Retargeting is a marketing technique that involves displaying ads to people who have shown interest by visiting the website or have taken action. It is often used to bring the audience back to a website to complete a purchase which is an effective way to help businesses reach and convert potential customers.

What Are Retargeting Ads?

Retargeting ads are very customer-centric. Unlike typical advertisements, retargeting ads are a form of digital advertising that is served to people who have already visited the website or are a contact in the database. It is a lead or a customer.

For example, say a consumer is shopping online for Chinese food and visited a webpage featuring gluten-free pasta noodles but he clicked away without buying anything or signing up for notifications. When they visit a website that sells ad space through advertisements, they get served an ad about gluten-free noodles.

Now the retargeting ad goals work for a different type of audience that a brand can segment by focusing on the campaigns that should run for awareness and conversion. Additionally, retargeting can be used to move qualified leads to complete the buyer’s journey cycle.

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How Does Fraud Happen in Retargeting Campaigns?

Companies invest a significant portion of their budgets in advertisements. Moreover, 30-40% of the investment is primarily directed toward approaching consumers using retargeting ads.

Despite this, retargeting ad fraud is not a brand-new concept. During retargeting campaigns, there is a risk of fraudsters ruining the campaign. These fraudsters include bots, click injection, autoloading, install fraud, automatic redirects, inappropriate ads, and many others.

Fraudulent activities occur due to these activities:

  • Click Fraud: During click fraud fraudster repeatedly clicks on an ad or uses automated software to click on advertising to generate fraudulent traffic and inflate the cost of the ad campaign.
  • Impression Fraud: In this fraudster employs automated software to produce fraudulent ad impressions, or views, to exaggerate the number of times an ad is presented.
  • Conversion Fraud: A conversion breach occurs when a fraudster utilizes fraudulent strategies to produce phony conversions or sales from an ad campaign.
  • Bot Traffic: It originates when a fraudster employs automated software, or bots, to produce fraudulent traffic to a website. This can be done to exaggerate ad impressions or to produce fraudulent conversions.
  • Invalid Traffic: The fraudster sends traffic to an ad from non-legitimate sources, such as spam emails or websites with undesirable material. This can reduce the impact of the marketing campaign and harm the brand’s image.
  • Affiliate Fraud: Affiliate fraud occurs when an affiliate partner utilizes deceptive strategies to create misleading conversions or ad clicks. This can reduce the impact of the marketing campaign and harm the brand’s image.

For example, a fraudster can easily circumvent common anti-fraud measures such as CAPTCHA or logic with the help of coding. Now, these pre-programmed codes or bots can easily click, view, or do any activity so that it looks like a genuine customer.

With the help of IP address masking, they will be able to hide the footprints of a bot that is repeatedly visiting the page. Retargeting campaigns must be protected from fraudulent activities by taking measures that counteract the impact of ad fraud.

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7 Impacts of Retargeting Fraud on a Brand

1. Financial Loss

Retargeting fraud can result in wasted ad spend for brands, as they may be paying for retargeting ads that are not reaching their intended audience. This can lead to a decrease in return on investment (ROI) and the overall effectiveness of the retargeting campaign.

2. Damage to Reputation

When retargeting ads are served to fake users or bots, it can lead to a low click-through rate and poor engagement. This can give the impression that a brand’s retargeting efforts are ineffective, which can negatively impact the brand’s image and reputation.

3. Difficulty in Measuring Campaign Effectiveness

Retargeting fraud can make it difficult for brands to accurately measure the effectiveness of their retargeting campaigns. When metrics are inflated by fraudsters, it can be challenging to determine the true performance of the campaign.

4. Legal and Compliance Risks

Retargeting fraud can also result in legal and compliance risks, as brands may be in violation of advertising laws and regulations if they unknowingly participate in fraudulent activity. This can lead to fines, penalties, and legal action.

5. Difficulty in Identifying and Mitigating Fraud

Retargeting fraud can be difficult to detect and mitigate, as fraudsters are constantly evolving their tactics. Brands may struggle to identify and combat fraudulent activity, which can lead to ongoing financial losses and reputational damage.

6. Missed Opportunities

Retargeting fraud can divert resources and attention away from more valuable marketing activities, such as customer acquisition, brand building, and product development. This can lead to missed opportunities for growth and expansion.

7. Decreased Ad Inventory

Retargeting fraud can also decrease the availability of ad inventory, as fraudulent activity can make it more difficult for brands to find and secure ad space with legitimate publishers. This can further reduce the effectiveness of retargeting campaigns.

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It’s evident that retargeting campaigns help a brand boost its awareness, increase its ROI, generate more sales, and more. Retargeting ad fraud, among other types of fraud, causes advertisers to lose a great deal of revenue, as well as audience reach.

It results in the decline of conversions for which retargeting ad campaigns are designed. To protect brand reputation in retargeting campaigns, it is important for companies to be proactive in detecting and preventing fraudulent activities in ad campaigns.

This can be done by implementing fraud detection and prevention measures, such as implementing tracking and monitoring systems, using trusted partners and stakeholders, and vendors, and conducting regular audits of the campaign. Moreover, investment in a good Ad Traffic Validation Suite will ensure that any bot activity is detected at an early stage.

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