TUESDAY, 12 JANUARY 2016
Breaking news: Observatory publishes study on online advertising
Here's some hot news for a chilly winter's morning.
A study on online advertising in relation to suspected copyright infringing websites has just been launched this morning by the European Observatory on Infringements. A link to the study can be found on the publications page of the Observatory website here.
The main findings of this report are as follows:
1. Brands are able to direct ad placement and control how ad companies manage their campaigns. Despite this, suspected IP infringing websites are a brand-rich environment: this study identified over 1,500 unique brands. Mainstream advertising alone made up 46% of all ads collected in this study. Brands may inadvertently advertise either because they do not know which websites pose an IP risk, or they cede full placement responsibility to intermediaries. Whilst a very large number of brands was identified, analysis shows there are two small sub-sets that have the potential to significantly impact the issue. First, premium brands belonging to 46% of the top 100 companies by global ad spend were identified. These companies potentially lend credibility to websites. Second, 70% of ads collected for named brands were for just 97 brands, all of which appeared in 20 or more EU Member States. Ad misplacement may impact brands negatively as it can affect return on investment for their ad spend. In addition, their own brand may be tarnished by being placed next to inappropriate content or malware.
2. In this study 54% of ads collected were in High Risk sectors: malware, fraud and adult. These ads pose a risk to consumers and generate income for websites. This type of advertising does not lend itself to outreach to the brand. Therefore, the intermediary (the ad company placing the ad) is the focal point for effective action. This study found just 10 out of 232 intermediaries placed 91% of all High Risk ads collected.
3. Intermediaries will usually take steps to avoid ad misplacement if a brand requests it. However, the security of the ad supply chain is breaking down in this fast evolving era of data-driven advertising and real-time ad decisions. Intermediaries have a responsibility to effectively pass along brands’ instructions and to implement systems and tools to ensure compliance with contractual obligations. In this study, a core group of 25 out of 232 intermediaries are involved in placing 73% of the Mainstream ads. This statistic, together with the fact stated above that just 10 intermediaries placed 91% of all High Risk ads, indicates that these 35 intermediaries may have a significant role to play in dealing with the problem.
4. Potential ad fraud was identified on 41% of the websites. These websites could potentially generate multiple ads on each webpage that are never visible to a consumer, thereby defrauding the brands that paid for those ads to appear. This is another reason why brands may find these types of websites pose a risk.
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