Could a simple .txt help save your spend from ad fraud?

Spoofers steal millions from advertisers, but the IAB is offering a simple idea to staunch the bleeding.

It’s estimated that advertisers will lose more than US$16 billion to online ad fraud this year, with a sizeable proportion of that falling to exchanges that programmatically sell publishers’ ad space without permission or, bolder yet, impersonate real publishers with imitation sites – a practice dubbed “spoofing.”

Publishers and sellers have been looking for a technical solution to this expensive problem, and a surprisingly simple tool from the IAB Tech Lab may be a solid step towards staunching the bleeding.

The initiative dubbed “ads.txt” officially launched in June. It sees publishers running tests that temporarily shut down their programmatic inventory and then scouring ad exchanges. If their temporarily closed site pops up, they know they’ve found a spoofer. Among participating Canadian publishers is Kijiji, which launched ads.txt on July 27

The process also involves slotting a simple .txt file onto a publisher’s site that plainly displays the names of permitted exchanges for all to see.

The concept has picked up steam quickly, getting major media attention when Google began testing the initiative on its ad network in the U.S. and Canada in June. Google now endorses and promotes ads.txt to its DoubleClick for Publishers clients.

A Google spokesperson told strategy‘s sister publication MiC it started conducting these tests after publishers approached them with concerns over counterfeit inventory. “These tests have confirmed how widespread of an issue this is for publishers and how important ads.txt is for the industry,” they said.

Just how important is it? Chris Williams, VP of digital with the Association of Canadian Advertisers (ACA), said those running “crappy supply chains” should be nervous. “It’s a tool that can drive the crap out of the system.”

He believes that with exposure on the issue, it will prompt more advertisers to adopt a “white list” approach to the publishers they work with.

“It’s one thing to do the blacklist or the exclusion list approach,” he said. “That’s a start, but it’s not sustainable in the long-term, because with the bad publishers, there are tools out there that can migrate their site from one domain to another in a matter of seconds,” thus dodging black lists.

While ads.txt is currently more popular in the U.S. (high-profile publishers like Business Insider and The New York Times are among those running it), IAB Canada has been promoting it to its members.

Drew Bradstock, SVP of product at Index Exchange, said he believes conversation around ads.txt exploded this year in the wake of the YouTube brand safety scandal.

“People realized that rather than just running their campaigns, they wanted to understand what it was running through,” he said. He added that many advertisers have begun to publicly prioritize safety over savings.

Bradstock, whose company has worked with some of the participating publishers including Business Insider, said companies are finding “dozens, if not more” exchanges selling their inventory illegitimately. These tend to go unnoticed, Bradstock said, because of the speed of digital transactions.