‘Ads.txt’: How a Little Bit of Code Is Putting a Big Dent in Ad Fraud

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It’s called the “advertising ecosystem,” which is the orderly but not entirely accurate description for a nearly $100-billion-dollar marketplace free-for-all.

In programmatic auctions, publishers, advertisers, and vendors are intensely focused on guiding millions of digital readers through the payday of “customer journeys,” some of which go nowhere because they’re controlled by a minority of tech-savvy grifters, scammers, and spoofers who operate in the shadows of what is a mostly non-transparent system open only to its trio of initiates.

Juniper Research estimates that worldwide fraud will cost advertisers $19 billion this year and rise to $44 billion by 2022. If the natural ecosystem were as out of balance as the “advertising ecosystem,” Earth might look more like uninhabitable Mars.

But the crisis finally is beginning to be addressed at least partly through an initiative from the Interactive Advertising Bureau bearing the nerdy name “ads.txt.”

According to the IAB Tech Lab, which developed the anti-fraud program, ads.txt is a text file of coding that creates a “publicly accessible record of authorized digital sellers for publisher inventory that programmatic buyers can index and reference if they wish to purchase inventory from authorized sellers.”

In the murky but super-fast-moving world of programmatic ad buying and selling, there was no sure way to detect fraudsters who were claiming to control a legitimate domain before ads.txt was introduced.

Ratko Vidakovic, who is a close observer of ad fraud and other programmatic issues on his blog AdProfs, says about the initiative:

“It’s a fundamental building block that should have been in place from day one. But better late than never.

“Smaller publishers have a lower risk of being spoofed than large ones, but it’s still important for them to have an ads.txt file because it declares the authorized sellers to the market.”

About 50% of all programmatic ad sales are now covered by ads.txt, most of them involving impressions on inventory of major publishers, according to estimates. In a move to extend the project more widely among smaller publishers, the full-stack agency10up has engineered an open-source ads.txt plugin on WordPress that it’s offering free of charge to any website.

I went to Ben Ilfeld, Lead Strategist, Audience & Revenue, at 10up, for more detail about the sometimes-swampy world of programmatic and how ads.txt and the 10up plugin work. Ilfeld made early appearances in Street Fight with the independent Sacramento Press, which he founded in 2008 and later sold before joining 10up three years ago.

In this Q & A, Ilfeld talks about ads.txt as a digital pioneer that is comfortable wearing interchangeably the hats of publisher, ad salesperson, and technologist.

The programmatic process is not just publishers selling their inventory and advertisers selecting the inventory they want – it’s more complicated.  Would you explain?

You’re an advertiser who wants to leverage user data and have incredible reach. These objectives are the big drivers for the middle layer of programmatic, which is not the publishers or the buyers, but everybody in between who is trading impressions as a commodity. There are an estimated 2,500 to 3,000 middlemen.

One of the problems is that it is difficult for the ultimate buyer to validate that they’re actually buying that domain—say, the New York Times—versus the scammer who has been able to convince one of the middle-layer companies that they are the New York Times and that’s their domain.

Ads.txt is a way for buyers to recognize that the person they’re buying from—that middle-level intermediary—has a relationship with the Times. It gives them more confidence that where their ad shows, it’s actually a legitimate domain and the intermediary they’re dealing with is authorized to sell the inventory.

 If the ad buyer doesn’t go through that process, what’s the outcome?

The advertiser is buying from an ad network not listed as authorized by the New York Times and most likely being taken for a ride.

Does ads.txt guarantee the quality of the ad?

Not necessarily. That’s a question of the content that it’s next to on the site. It’s a question of where the ad is placed—possibly at the bottom of the page, where it’s not likely to be seen. There are a lot of things that go into quality.

So ads.txt is not a panacea?

It’s a foundational step. It’s good for publishers for a couple of reasons.

First, their advertisers can double-check that they’re buying inventory from an authorized source. I don’t care how small a publisher is, it’s better to host a small file on your servers that says, “These are the ad networks that are authorized to sell my inventory.”

Second, once buyers recognize this process of validation, they are likely to buy inventory only from people who are clearly identified as authorized.

I wouldn’t be surprised that in two years we may look back and see that ads that have ads.txt have CPMs that are 20% higher than those that didn’t have ads.txt.

What about direct sales versus programmatic?

If you’re 100% direct-sell, you won’t need ads.txt.

10up is now offering an open-source, free ads.txt plugin on WordPress. What’s your next step?

We’re building things like a validator so you can make sure you entered the right codes. Our next step is ads.cert. I’ll explain that in a minute, but first I want to get the word out about the free open-source ads.txt plugin. It’s super cool. Everyone should be using it. At 10up, we don’t profit off it in any way.

The plugin is already active on more than 1,000 websites, and is also officially recommended and supported by WordPress.com VIP and VIP Go. 10up is already capturing future enhancements on GitHub for the plugin. Planned enhancements include:

  • Real-time validation and revisions so that changes can be reviewed or restored;
  • Ads.cert [recommended by AdProfs’ Ratko Vidakovic], which takes the protections of ads.txt further by confirming information passing between the buyer and seller at every stage.

Any publisher can download Ads.txt Manager for WordPress from the official WordPress Plugin repository or GitHub. Simple as that.

Tom GrubisichTom Grubisich (@TomGrubisich) has written “The New News” column for Street Fight since 2011. He is also working on a book about the history, present, and future of Charleston, S.C.