According to BIA/Kelsey, location data will be used in upwards of $38bn of mobile ad spend in the US this year, but unfortunately for marketers paying to reach consumers in specific locations, the evidence suggests that much of the location data being used in location-based ad targeting is not only inaccurate but totally fraudulent.
Somewhere between 30% to 80% of location data used is believed by experts to be illegitimate and if this belief is accurate, this means that marketers are spending potentially tens of billions of dollars on ads that don’t have the characteristics they’re paying for.
Needless to say, this is a huge problem and it’s only likely to get worse as location data becomes more important. For example, with cookie tracking dying a slow death, alternative ways of measuring digital marketing activities will become more prominent and some of these, such as geo-testing, rely on the use of location-based ad targeting.
So what can marketers do? Here are six ways they can fight the scourge of bad location data in the digital ad ecosystem.
Don’t rely as heavily on location-based targeting
The value of location-based targeting can’t be denied but understanding that it isn’t perfect even when fraud isn’t taken into consideration, marketers should be thoughtful in how they employ it. Specifically, marketers should consider the relative value of location-based targeting in the context of a specific campaign.
For example, is location a necessity, as might be the case for a retail campaign targeting winter jackets to individuals who live in cold regions? Or is location being used as a proxy, as might be the case for an ad campaign targeting ZIP codes associated with high net worth individuals (HNWIs).
Where location is a proxy, it can be worth exploring alternative approaches. Using HNWIs as an example, a marketer might find that the target audience can be reached more effectively and with less risk through carefully-selected private marketplaces (PMPs) selling inventory from specific publishers rather than using a location proxy.
Use standards to avoid generally suspect ads
There are a number of IAB standards that aim to reduce ad fraud. These include ads.txt, app-ads.txt and ads.cert. While none of these standards directly address fraudulent location data, there’s an argument to be made that by using these standards to avoid the worst of the bad ads, marketers can probably weed out at least some of the location fraud.
ads.cert in particular can be useful as it is designed to ensure that inventory is not modified as it makes its way through the ad supply chain.
Sweat the bidstream details
Many location-targeted ads are being purchased in the RTB ecosystem. Here, location information, when it is present, is described in the bidstream’s geo data object.
While there’s nothing preventing scammers from misrepresenting the data in the geo data object, paying attention to the contents can be very helpful. One of the geo data object fields is type and it describes where the location data came from. Some sources, like GPS, are more accurate and precise than others, like IP address.
It’s also important for marketers to pay attention to whether the geo data object is associated with the user or device. The former represents where the individual using the device is determined to be based while the latter represents where the device currently is physically.
By opting not to use location-based targeting when the data associated with inventory isn’t accurate or precise enough, marketers can at least ensure that they’re not losing out to fraud on inventory that was of more limited value to them anyway.
Know the capabilities of your DSPs
Recognizing that fraud, including location data misrepresentation, is a big problem, many DSPs have implemented technologies aimed at detecting suspicious inventory and preventing their clients from buying it.
While these technologies are typically operating in the background and don’t require any extra effort on the part of media buyers, marketers shouldn’t simply assume that their DSPs are all using the best tech to protect them. Instead, they should ask their DSPs to detail how they fight fraud, including fraud relating to location data, and where appropriate, advocate for change.
Get third-party verification
There are a number of third-party vendors that specialize in ad verification. While many of them sell their wares directly to DSPs, marketers using location data extensively can also consider engaging directly. These vendors can, among other things, help marketers assess the efficacy of their locationbased campaigns and determine how much of the location data they’re using is legitimate.
Use analytics data
An indirect way for marketers to evaluate whether their location-based campaigns are falling victim to fraud in a big way is to look at the analytics data generated by the traffic from these campaigns.
If the geographic location of the traffic generated doesn’t seem well-correlated with the geographies targeted, it is an obvious sign that a meaningful amount of the location data being used is inaccurate or fraudulent.