A Sucker Born Every Minute

With any scheme, wherever there is a crowd of people willing to throw huge amounts of cash around with little oversight, criminals are sure to gather.  And so it goes that just like they have done with carbon trading systems governments, bankers and big business want to impose on the world, crooks have infiltrated the ad network business and, according to Adweek, are skimming $400 million per year.  Bob Hoffman goes to town on these scammers and the gullible marketers and agencies who fall over each other to buy audiences and clicks and is worth a read.

What the crooks have set up, and the industry has only begin to expose, are ghost sites:

Increasingly, digital agencies and buy-side technology firms are seeing massive traffic and audience spikes from groups of Web publishers few people have ever heard of. These sites—billed as legitimate media properties—are built to look authentic on the surface, with generic, nonalarm-sounding content. But after digging deeper, it becomes evident that very little of these sites' audiences are real people. Yet big name advertisers are spending millions trying to reach engaged users on these properties.

Well, so much for buying audiences.

How sophisticated these operations are was revealed by Business Insider.  It was told by spider.io, a Web analytics company, that it detected a malware-controlled computer network that has:

120,000 host machines on what it has dubbed the "Chameleon" botnet. It says these machines are driving traffic to a cluster of at least 202 websites, resulting in a minimum of 9 billion monthly ad impressions served.

This traffic often appears human, suggesting a high level of sophistication. Chameleon machines click on ads at a rate consistent with the general population – about 0.02% – and they even generate rollovers on 11% of impressions.

Spider.io estimates that the botnet is defrauding advertisers — who end up paying for clicks that don't really really exist — of about $6 million a month.

It remains to be seen what effect the botnets and ghost sites will have on online ad numbers once they are winnowed out (it could be up to 50% of Web traffic), but, hopefully, it will finally crush the myth of the success of online advertising/brand building once and for all.  Then another minute will pass…