When wastage becomes fraud

BY Tim Burrowes

April 8, 2024 10:28

Welcome to a Tuesday update from Unmade. The full post is exclusive to our paying members. Today: How the Forbes scandal plays into widespread digital fraud across the digital landscape.

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The Forbes fraud

Media brands are a lot harder to kill than you’d think.

Forbes should have lost all its credibility years ago. Much of its content has been for sale for more than a decade.

Yet I doubt that even the revelations from the Wall Street Journal that digital advertisers have been ~~systematically defrauded~~ suffering an “unintentional error” for at least five years will be enough to sink the 107-year-old brand.

The allegations relate to the behaviour of the parent company, not the local franchise of Forbes Australia, by the way.

Four days ago, the WSJ revealed that while brands were paying to have their ads appear alongside articles on the main Forbes.com site, many of them were being diverted to the similar URL of www3.forbes.com, where the same articles were broken into chunks and turned into slides shows across multiple pages.

According to WSJ: “One 700-word article was turned into a 34-slide slideshow, exposing the person who read it on a computer to about 150 ads instead of around seven for someone who read the original piece.”

Having your ad as one of 150 effectively makes it worthless. Forbes blamed its programatic partner who claimed the whole thing was an innocent error. Funny how these mistakes only ever seem to benefit the party making them.

These ads included big brands such as McDonald’s, Disney, Microsoft and American Express.

So where were the media agencies – the people supposed to buy wisely to protect their clients from fraud – in all this? According to the WSJ article: “All six major ad-agency holding companies—WPP, Omnicom, Publicis, Interpublic, Havas and Dentsu—bought ads that ran on that site.

“Those brands and ad-holding companies either declined to comment or didn’t respond to requests for comment.” I bet they didn’t.

Even without fraud, the amount of wastage occurring in the digital advertising chain is just astonishing. I wrote last month about a discussion on the topic hosted by Sayers group. It was under the Chatham House Rule so I can’t share speaker details, but the major feeling I was left with is one of puzzlement about why the status quo is still holding.

How can any marketer who’s taken the trouble to familiarise themselves with last year’s Association of National Advertisers Programmatic Media Supply Chain Transparency Study not be rethinking where they place their budgets?

Only 36c in every dollar of digital spend ends up with an ad landing in front of a consumer.

Zen and the art of financial indices

The Unmade Index saw a balanced start to the week on Monday with four stocks rising, three sinking and eight standing still. Our tracker of Australia’s listed media and marketing stocks rose slightly by 0.36% – in keeping with the wider ASX All Ords which rose by 0.24% – to land at 564.8 points.