A new report from Juniper Research has found that advertisers will lose an estimated US $19 billion to fraudulent activities next year, equivalent to US $51 million per day. This figure, representing advertising on online and mobile devices, will continue to rise, is projected to reach US $44 billion by 2022.
Ad Platforms Need to Break Out of Walled Gardens
Juniper’s new research, “Future Digital Advertising – AI, Ad Fraud &: Ad Blocking 2017-2022″, claimed that the ‘Walled Garden’, a closed platform approach whereby advertising platforms restrict the flow of advertising performance data to advertisers and publishers must be abandoned to stimulate transparency between stakeholders. The report found that advertising fraud rates will continue to increase as a result of this, further hindering stakeholder efforts in tackling fraud.
The research provides actionable insights, market intelligence and strategic recommendations for stakeholders on the swiftly changing digital advertising markets covering: Mobile Advertising; Online Advertising; Smartwatch Advertising; and Out of Home Advertising.
It investigates the opportunities across key channels, considering the adoption of ad blocking technologies and the role that Artificial Intelligence will play in the future of the market. It identifies ad targeting strategies and the prevention of advertising fraud, to present a comprehensive outline of the next 5 years of the digital advertising industry.
Additionally, the research predicted that AI will be crucial in analysing the vast amounts of data generated from advertising activities daily and minimising loss due to fraud. It predicted that fraudsters will increasingly innovate in their approaches to imitate genuine advertising activity including simulated clicks, mouse movements and social network accounts.
“Fraudsters will continue to heavily invest in domains, user accounts and bot farms in order to appear genuine,” argued research author Sam Barker. “Advertising stakeholders will demand constant vigilance against the threat of ad fraud, which will only be achieved through the correct implementation of AI services”.
AI & The Race for Data
The research predicted that platforms leveraging AI for targeting purposes will account for 74% of total online and mobile advertising spend by 2022. However, as the adoption of AI becomes saturated, only platforms demonstrating the most effective algorithms will be able to charge premium prices to advertisers.
According to the study, these platforms will need to focus on new data sources to improve the proficiency of their AI algorithms. Data from IoT (Internet of Things) devices, information sharing partnerships and cross device user identification will therefore become highly sought-after.