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Digital advertising is now a $50 billion dollar industry, and it continues to grow, but many firms are cautious about how much more money they will put in digital advertising. This caution is because of the growing fraudulent digital advertising industry. Typically, marketers pay for ads when users visit a web site, whether or not the user is a human. The frauds create web sites and then create computer generated programs to visit those sites to make it seem as if people are actually visiting the web site. According to the article, about 36% of all web traffic is fake.
Quentin George, a co-founder of ad-technology firm Unboud, says that there should be more money in digital advertising considering how much time people spend on the internet, but issues like fraud limit firm's confidence in the effectiveness of digital advertising. Marketers are responding to the issue for fraud by actively monitoring for fraud, and by demanding a refund if fraudulent digital advertising is found. Another option is some marketers are now only paying the website when there is clear evidence that the user has signed up for their product. The article notes many of many of the "fraudsters" are from eastern Europe. If the eastern European fraudsters are stealing money from what are mostly western firms, do the marketers or security services have any incentive to catch and punish the fraudsters, or should they be more focused on finding new ways to charge marketers that will prevent fraudsters from abusing the system?
2 comments:
Consumer confidence doesn't always transfer well across international lines, especially when it comes to internet ad revenue. Conceivably, ISPs can help direct bad traffic.
Now a days technology is increasing and it needs to be regulated. I wonder if this will increase the demand for computer science and other professions that deal with computers. Even though they have been increasing already this shows how the demand will increase.
Cyber crime is still rampant, will it ever go away? Will international law need to be changed to accustom to these changes? Will there be an international police force to protect website and such?
Is this a market failure? Because information is not fully supplied to advertisers?
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