Ad fraud is one of the largest frauds in the history of the world. Nobody knows the exact extent of ad fraud but several reputable studies peg it at over $80 to $100 billion. Here are some interesting stats on ad fraud.
According to Advertising Age magazine and Spider Labs, “ ... an estimated 20% of (online) ad budgets globally (are) being snatched by fraudsters.” If that number is right, in 2024 well over $100 billion will be lost to online ad fraud.
Juniper Research estimated 2023 ad fraud at $84 billion.
The Association of National Advertisers (ANA) in the U.S. has variously estimated 2022 ad fraud at $81 billion and $120 billion.
The World Federation of Advertisers says that by 2025 advertising fraud may be the second largest source of criminal income on the planet, after drug trafficking.
Professor Roberto Cavazos, economist at the University of Baltimore who has studied business fraud for over 30 years says, “ ... the level of ad fraud is now staggering. The digital advertising sector has ... higher fraud rates than multi- trillion-dollar sectors.”
Cheq, a fraud detection company, says that online ad fraud has overtaken credit card fraud despite the fact that the credit card business is ten times the size of online advertising.
Kevin Frisch, the former head of performance marketing and consumer relations management at Uber says that one type of ad fraud called “attribution fraud” was headed toward eating $100 million of Uber’s $150 million online ad budget: “We turned off 2/3 of our spend ... and basically saw no change ... ”
Dr. Augustin Fou, an expert in online ad fraud with a PhD from MIT, who taught digital and integrated marketing at Rutgers University and N.Y.U., and was Senior VP, digital strategy lead at McCann/MRM Worldwide, calculated that just one detected instance of fraud called “Fireball” could generate 30 billion fraudulent ad impressions a minute. He said, “ ... fraud on such a massive scale is beyond belief.”
The ANA and consultancy PwC reported that of $200 billion in annual advertising spending on programmatic advertising in the U.S., only $60 billion ever reached a human being—70% evaporated! No one knows how much of the missing $140 billion was the result of fraud.