This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

#Digitalskeptic: Malware and Bots Are Murdering Web Advertising

NEW YORK (MainStreet) -- Ari Jacoby is getting darn worn out of fighting the Internet advertising zombies all by his lonesome.

"Fifty percent of all ads are not seen by humans. And 50% of that traffic is nothing more than bots," Jacoby practically yelled at me over the phone. "It's insane."

The man's frustration is understandable. He's founder of Solve Media, a 43-employee advertising security firm that polices the Web for more than 7,000 advertisers and publishers checking that the people using Web ads really are people -- not some automated bot, malware or other sort of Web software zombie.

"That all means that only 25 some-odd cents of any ad dollar is going anywhere near a living person," he said. "Considering that bots cannot eat snack cakes and cannot drive cars off dealer lots, they don't add to the bottom line."

What's truly freakish about Jacoby's tales of Web advertising ghosts and ghouls is how blithe the Internet continues to be about advertising the automated threats Jacoby studies. He very articulately points out that even after 15 years of trying, the Web takes an almost grisly pride in caring not one bit about the automated criminal element in Web marketing.

"Shortly after organic SEO became a recognized marketing channel, problems with click validity arose," Jessie Stricchiola, founder of San Francisco-based search engine optimization firm Alchemist Media wrote in a company blog post.

Stricchiola goes on to say that click and automated ad fraud is in fact not only continual, but can spike in certain product types, verticals, keywords and bid prices.

There is "increasing evidence," Stricchiola said, "that the higher the bid price, the more rampant the click fraud."

Either way, Jacoby said, Web publishers and marketers simply covered the cost of non-human and fraudulent traffic. "Basically, it was all priced into the cost of a click," Jacoby said.

Brand advertising gets zombied
The laissez-faire attitude toward Web zombies began to change about two years ago when more sophisticated, so-called brand advertising dollars began to flow online. These types of brand advertisers are usually top-end marketers, such as carmakers and food companies. And since such ads are pricier investments for these advertisers, they become much fussier about where ads run, how they are viewed. And how well they perform.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,399.67 +19.26 0.12%
S&P 500 1,904.01 +17.25 0.91%
NASDAQ 4,316.0740 +57.6360 1.35%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs