News Feature | July 16, 2014

Is Bot Fraud Affecting Brand Integrity, E-commerce?

Source: Innovative Retail Technologies
Christine Kern

By Christine Kern, contributing writer

Bot Fraud in eCommerce

New Initiative Designed to Engage Advertisers, Limit Bot Fraud, Help Retailers

Last fall, Incapsula, a cloud-based service provider, released its “Bot Traffic Report 2013,” which is described as a “rare glimpse in between the lines of Google Analytics.” The report reveals that non-human traffic now accounts for 61.5% of all website traffic, and that the presence of good bots has increased from 20% to 31% in 2013. 

The report points out that there has been a significant drop in spam bot activity, decreasing from 2% in 2012 to 0.5% in 2013. Igal Zeifman, Product Evangelist for Incapsula, commented on the impact of this drop in spam bot activity on e-retailers.

He said, “Spam comments are often interpreted by visitors in a negative manner, influencing their perception about the site, its quality and trustworthiness. This is a big problem for e-commerce websites, because TRUST is a major component of any business transaction. Moreover, some spam links can be used to inject malware, and also expose the visitors to questionable material. In both cases, the site owner could be held responsible. Now, with much less automated spam, the e-retailers have one less thing to worry about.”

Although spam bot activity has decreased, however, bot fraud has continued to plague digital sites.

 To better understand the extent to which bot fraud penetrates the digital advertising ecosystem and how to combat it, the Association of National Advertisers is embarking on a month-long study tracking the campaigns of 30 advertisers. The initiative is dubbed “The Marketers’ Coalition.”

The coalition’s objective is to provide actionable data and insights which marketers can use to reduce bot fraud and improve marketing ROI.

Bot fraud refers to sites with phony traffic that collect payments from advertisers through the middlemen who aggregate space across many sites and resell that space. This ANA/White Ops initiative actively responds to serious breakdowns in the marketing supply chain. For some marketers it is estimated that 25-50 percent of money spent on digital advertising is wasted through “bot fraud” which affects display, video, mobile and social.

The industry group has hired digital advertising security firm, White Ops, to track and monitor fraud instances throughout August via JavaScript tracking tags on participating advertisers’ campaigns. The group will publish a report with insights and recommended actions in mid-October.

Bob Liodice, President and CEO of the ANA said in the announcement “The findings will be integrated into a broad ecosystem effort to minimize fraud. This ongoing effort is jointly led by the IAB, 4As and the ANA and is focused on creating a trustworthy digital supply chain.”

“Bot fraud costs marketers billions of dollars annually. Marketers must be proactive to fully understand the issue and identify solutions, said Bill Duggan, ANA, Group EVP.  He added: “These results will create urgency for all legitimate players in the ecosystem to work together to eliminate bots and botnets that target unsuspecting advertisers.”

The Incapsula study also showed that there was an 8% increase in the activity of “Other Impersonators,” which is described as a group of unclassified bots with hostile intentions (bad bots). These intentions are to infiltrate their way through a website’s security measures, according to Zeifman, and the bad bots do this mainly by pretending to be good bots or agents of legitimate services. The group includes automated spy bots, human-like DDoS agents or a Trojan-activated barebones browser. Such bad bots can affect all aspects of e-commerce. 

So how will this affect retailers?  Marketing is clearly an important aspect of all retail business, but even beyond that, the scope of bot fraud can penetrate the entire e-commerce market.  Better strategies to combat bot fraud, including efforts to prevent it in the first place, can only benefit all links in the supply chain.