Bot Traffic a Growing Problem for Online Advertising Market

According to Solve Media, a firm that combines advertising opportunities with CAPTCHAs, and counts Sony, UPS, McDonalds, and Macy’s among its clients, says new research and market surveys show that bots are costing publishers and advertisers billions of dollars annually.

According to the company’s research, 10-percent of all traffic online comes from bots, compromised host systems that can be used to generate malicious traffic (DDoS) or ghost traffic (fake page visits and ad clicks) depending on the whims of the bots’ controller.

Solve Media reviewed a monthly average of 100 million identity authentications from all of 2011 to August 2012 across 5,000 publishers. They discovered that most of the bot traffic originates in the U.S., when based on the overall number of bots. However, Singapore and Taiwan had the highest percentage of bot traffic, at 56% and 54% respectively. On percentages, the U.S. hosts less than 20% of the bots online.

“Security is a paramount concern for publishers and advertisers, as they continue to be victimized by bots,” said Ari Jacoby, CEO of Solve Media.

eMarketer predicts online display ad spend will reach $15.3 billion globally in 2012, which means that potentially $1.5 billion in ads will be served to bots. Since 2011, Solve Media has witnessed a 400 percent rise in aberrant traffic across registration, voting, commenting and contact services on the web.

Moreover, comScore observed that between 4% and 11% of ad impressions for given U.S. campaigns were delivered against bot traffic.

“The existence of non-human traffic is an issue that affects the entire digital ad ecosystem,” said Kirby Winfield, SVP of Corporate Development, comScore.

“comScore research has shown that a significant percentage of ad campaigns are delivered against non-human traffic, which represents waste for advertisers that can diminish their confidence in the medium. Any efforts to quantify the magnitude of this problem and validate ad delivery represent a step in the right direction for digital.”

Advertisers can offset some of the loss by moving from Per-Click marketing plan to a Per-Engagement (or Per-Action such as a sale or legit sigh-up) one, and by working with publishers that utilize anti-bot tools on their ad platforms.