Kevin Kerner: 0:00

Hey again everyone. This is Kevin Kerner with Tech Marketing Rewired. What if I told you that 90% of your ad impressions might never be seen by a human and no one wants to talk about it? In this episode, I spoke with Dr Augustine Fu, a leading expert in digital ad fraud and media transparency. We dug into how ad fraud actually works, why many brands are flying blind, the difference between attention and attentiveness, and how bots are quietly draining millions from marketing budgets, even in B2B. Let's get to it.Kevin Kerner: 0:29

This is Tech Marketing Rewired. Hello everyone, and welcome back to Tech Marketing Rewired. Today's guest is Dr Augustine Fu. Dr Fu is one of the most respected experts in digital ad fraud and media transparency. He holds a PhD from MIT and previously served as chief digital officer at both Omnicom's Healthcare Consultancy Group and McCann Worldwide. Today, he runs Fu Analytics and works as an independent cybersecurity advisor, helping brands uncover and fight fraud in their digital media. Dr Augustine, welcome to the show. Thank you, kevin, glad to be here with you. Yeah, I am really excited to have you here. Just personally, I wanted to learn more about this space, particularly as it relates to B2B and tech. I've been reading your research and following you on LinkedIn and I really would love to get into the various forms of digital ad fraud. But first I wonder if you could give us a quick introduction of yourself and then, foo Analytics, tell us what you do All right.

Dr. Augustine Fou: 1:33

Well, I've been in digital advertising since the very beginning of mid 90s, so to speak. I was at McKinsey Company and we built a little lab in the New York office with two Apple computers, two IBM PCs and two Sun workstations. So that was right at the very beginning, when web pages were simply pages of text with a few words underlined that you could actually click on. It would bring you to the next page, called hypertext. So it was since that time we looked at the potential impact of the internet on entire industries and obviously we've seen that come to fruition. It's changed so many industries, including ours, the digital advertising industry. So I've been in it for a long time. I worked on both the client side at American Express as well as the agency side at both IPG Holding Company and Omnicom and ultimately left about 13, almost 14 years ago to get back to my own consulting practice, and that's when we started building what is now known as Foo Analytics. So back then we were seeing, you know, somewhat of a in a B2B context as well. We were serving pharmaceutical clients and they were doing a lot of search marketing to try to get doctors to understand their prescription drugs and things like that, and we're seeing a lot of clicks, sometimes even 200% click-through rates right, just completely insane CTRs and sometimes those clicks would keep coming even after the campaign was over. So clearly something was wrong, but at the time no one could really explain what was going on like what was causing that.

Dr. Augustine Fou: 3:06

So some of the tools I started building was to really start auditing these campaigns and figure out what was going on. So in the very beginning we were doing on-site measurements and we would see the clicks coming from search campaigns and other types of marketing and we could tell these were obviously bots clicking. They were leaving right away. They weren't doing anything on the site. So we were able to detect the bots and fast forward. Now, 15 years, we've added in-ad detection. So Foo Analytics has both on-site measurement as well as in-ad measurement, which means we measure the ads themselves, and it's all centered around finding the bots and also other forms of fraud that are impacting these ads. So that's been like 30 years of my life doing digital marketing and the last 15 focused on the fraud problem. That's pretty rampant in digital advertising, affecting both the B2C side, which is consumer marketing, and B2C side, which is consumer marketing, and B2B side, which is marketing to businesses.

Kevin Kerner: 4:09

Yeah, fascinating If you could get into what are some of the forms of digital ad fraud, just as the primer on this stuff. What type of fraud are you seeing?

Dr. Augustine Fou: 4:18

Yeah, so I'm gonna stick with the IAB framework. So they have four main types of digital ad revenue, so CPM, cpc, cpl and CPA. So I'll explain each of these in order. So CPM means cost per mil or cost per thousand, and these are typically the way advertisers pay for display ads or video ads. Right, every thousand display ads you pay a certain amount, a dollar amount. So in this case the type of fraud is simply CPM fraud, where all the bots have to do is load the ad impressions right, and if they load a thousand times they get paid. Cpc is cost per click, so you actually have to click on the ad, like a search ad, in order to get paid the CPC. So the bots not only cause the ad to load right, they type in a search keyword, they see all the search ads that load and then they click on certain ones and so then they get paid for the CPC.

Dr. Augustine Fou: 5:13

The third kind is a cost per lead, cpl, and those are typically like B2B marketers or maybe, say, university marketers, where they're paying on a cost per lead basis, right?

Dr. Augustine Fou: 5:24

So every time they get a completed form fill, they pay out. You know, could be $5, could be 50, could even be $500 per lead, depending on the industry. So in those cases we've seen the bots complete those lead forms and submit them. Because the way you think about the bots activity is they will do the exact thing you pay for, right? So if it's a cost per lead that you pay, they'll do exactly that, nothing more, nothing less. Right. They're very, very efficient in terms of their use. And then, finally, there's CPA, which is cost per acquisition, and you can usually think about that in terms of affiliate fraud, or now attribution fraud, right, that's after the sale occurs, a revenue share gets paid on the purchase value, and so the bots can also fake that right. So there's various forms of fraud in every single revenue model, right, every single ad type that the IAB has. So that's kind of the context of everything.

Kevin Kerner: 6:21

And then we can kind of dig into the details of each. Incredible what's in it. I each Incredible what's in it. I'm just curious what's in it for the bad actors?

Dr. Augustine Fou: 6:29

Like why Just money, pure profit. So I'll use a very simple scenario. Right 15 years ago, when we started adding many, many websites to run ads in the very early days, you remember Yahoo and that's like a big, huge portal that had all sorts of content on there from weather to sports scores, stock quotes to news and all that kind of stuff. So it aggregated large human audiences. And if you buy ads on the Yahoo portal, you got mass awareness because lots of people saw it. So since that time we've started evolving and adding what people call long tail websites. So now we have millions upon millions of long tail websites that by themselves they don't get a ton of traffic, but if you put them all together, that's again the theory Right? So if you have lots and lots of these small sites, the collective traffic is enough to be sizable. According to that theory, you now have millions of long tail sites that are now selling ads through programmatic exchanges. So, just like Wall Street is a stock exchange where buyers and sellers of shares of stock come together at auction auction each individual stock share, in the programmatic ad exchanges we do the same with each ad impression. So now every single ad opportunity is auctioned off Whoever wants to bid on that and whoever bids the highest will typically win, and then they have the right to serve the ad into that. Now what's happened is that in the last 15 years, when programmatic media buying became the dominant form of buying ads, that's when the fraud exploded, because, for the very first time, these long tail websites that nobody has ever heard of before have the opportunity to sell ads to the largest of advertisers, right. Previously. Just imagine a no-name company walking into a P&G to say oh yeah, we have a hundred billion impressions to sell you. P&g will kick them out the door Like who the heck are you guys, right, we've never heard of you, we're never going to buy from you. So back then, when the media buying took place between the advertiser and a real publisher, like a Condé Nast, a Hearst, a Meredith right, a Time Inc that was still relatively clean because you could actually see who you're buying from. But now, when you're buying from a programmatic exchange, there's millions of sites that you've never, ever heard of that are selling ads right, and they're selling millions and millions of impressions. So, again because of programmatic advertising, that's when fraud exploded.

Dr. Augustine Fou: 9:00

And now getting back to how the bad guys make money. Bad guys would basically set up 10,000 sites in a month, all using WordPress templates and all using plagiarized content, right? Whether it's text or images. They just go, scrape it off of someone else's site and just assemble it into their own WordPress sites. Now, these days, with AI, you don't even need to steal content, right? You can just generate it. Okay, so it's all been happening for 15 years.

Dr. Augustine Fou: 9:28

But those long tail websites that nobody's ever heard of would obviously have no human visitors. So what do they need to do? They literally have to go out and buy all their traffic. So if you just Google, buy traffic from my website, there's going to be tons of sellers, right? Tons of vendors happily selling you traffic. So it's the exact same phenomenon, as you can go on.

Dr. Augustine Fou: 9:50

Buy views for your YouTube channel, right. Buy likes for your Facebook page. Buy followers for your Instagram account right. All of those things can be purchased. But obviously those are not humans. Those are bots, even if the legacy verification vendors can't detect them as bots. But just use a little bit of common sense and just think about. There's not a whole bunch of humans sitting around with nothing to do but to go to your website when you tell them to. That just doesn't happen in real life life. So when you can say, oh, I need 10 million page views this month, how much does it cost? It is 100% manufactured by bots, and so that's how the bad guys make money. So they're buying traffic for their website, they're selling the ads at a higher CPM than their cost of traffic and they've made pure profit. Right, it's just arbitrage. And then there's all the vendors in between, but we won't get into all those other things. But like, there's a whole ecosystem to support the fraud.

Kevin Kerner: 10:49

Wow, just amazing. I mean, what is wrong with people? It's incredible the amount of complexity and all that. There's simplicity. It's a little simple, but there's a lot of complexity.

Dr. Augustine Fou: 10:57

Yeah, I think it boils down to you know, in the physical world it's actually much harder to fake stuff. Like you know, in the physical world it's actually much harder to fake stuff Like imagine if you had to make a counterfeit Hermes handbag, ok, you literally have to go make one Right In digital. It's all bits and bytes. So you can literally register a domain for $7.99 on GoDaddy or something Right. So the ways of mimicking or making the illusion of something is so much easier in digital. And also you can fake all the metrics, by the way. So you know, making a counterfeit things in digital is so much easier and that's why literally everybody and their brother-in-law are getting involved.

Kevin Kerner: 11:37

Wow, Amazing. I want to get into some of the schemes that are happening here, but I wanted to ask you a question that came to mind what's the? Have you found a way to quantify the impact of this across the industry? And then, what's the average like effect if I'm a brand let's say I'm a mid-sized tech brand and I'm running ads like what's the monetary effect of this? Do you have any?

Dr. Augustine Fou: 11:57

idea. Yeah, I mean, if I say this out loud, everyone will think I'm crazy, right? Not that they don't already think I'm crazy, but it's the vast majority of this stuff, right? Because the problem is, 15 years ago the big advertisers were saying, okay, there's such limited quantity of ads we can buy from a legit publisher like New York Times. Why is it so limited? It's because humans' behavior doesn't change that much, right? When you go read an article in New York Times, you probably literally look at that one article and maybe one more, you know, generate three to five page views and then you're out of there, right, you leave. So humans, visitation patterns on websites just don't throw off enough page views to generate, you know, the hockey stick of growth that VCs wanted. So they're always looking for where can I get more traffic? Where can I get more ad impressions? Right? So then they started looking at programmatic exchanges and then, magically, for the last 15 years, we've had enough traffic to satisfy as much demand as we want.

Dr. Augustine Fou: 12:56

So this also even gets to the fundamental economics principles that you learned in school, right? If there's a lot of demand, right, huge increase in demand and there's only finite supply, the prices should go up. Basic economic principles. But what we've seen for the last 15 years is that, even though there's been massive demand coming into digital, big advertisers are taking dollars away from print, from newspapers, from TV, and shifting it into digital. Despite this massive increase in demand, the prices went down. That means the amount of supply went up even faster than the demand and you can basically say all of that supply was manufactured out of thin air, right? Because you can literally tell a bot okay, this week I need a million page views, next week I need 10. The following week, I need 100 million page views. It can all be manufactured out of thin air, right? It's just bits and bytes, so in that sense, you can think of it as the majority. Now, it's not evenly spread, because there are certain advertisers that are extremely strict and extremely vigilant in their buying practices and they will definitely be affected less by the fraud.

Dr. Augustine Fou: 14:13

But when you have a super large advertiser, say, for example, a CPG company, that has way, way too much money to spend, right, okay, they were given $2 billion to spend in digital, okay, how do I go spend all of this? They basically tasked their agencies with an impossible task. Go spend it all for me, right, and the agencies happily do that. And when they go to exchange after exchange, publisher after publisher, and ask how much inventory can you sell me? They literally will run out. There's just not enough inventory to be bought. So then they start digging into places they shouldn't be digging into, like, oh, who else can sell me stuff? All the bad guys will raise their hand oh yeah, we got a whole bunch of impressions over here to sell. You, come on over. So that's where stuff goes south.

Dr. Augustine Fou: 15:00

And even the middlemen, like the agencies, the exchanges themselves or whatever, even though they're not the ones making the bots, they're certainly benefiting from the existence of those bots because they need the volume to satisfy all the demand. So again, you can see how a lot of these things are misaligned incentives, so to speak. Right, so I'll kind of put this out there. Ad fraud is not a tech issue that you can solve by throwing more tech at it. Ad fraud is an incentives issue. If you don't want it solved, you can just go about your day and just buy unlimited more ads that you want. But if you actually want it solved, right, there's ways to solve it and it's very, very simple and straightforward, right. It's not about buying more verification tech and throwing more tech at it to try to solve it, because the bots will always be better.

Kevin Kerner: 15:51

Wow, amazing. Yeah, it's a really simple explanation you gave. You're right, like if you're on the New York Times or some Wired or whatever. There's only so much to go around.

Dr. Augustine Fou: 16:02

Very finite, very limited inventory. Yeah.

Kevin Kerner: 16:05

That is crazy. I can't believe I had never thought of that, but that is really the truth. Now in B2B let's say midsize to larger tech brands- Even more limited.

Kevin Kerner: 16:14

Yeah yeah, it's super limited. Yeah, really incredible. So now I want to get into some of the schemes that are being used out there and I read some of your research on this. It's really fascinating. So can you take us through, like, some of the things that they actually do and then maybe your advice on how to catch these things and what you should do if you're trying, if you see one of these things happening?

Dr. Augustine Fou: 16:38

Yeah. So I'm going to start with something very simple and you can kind of understand how it evolved, right, and that's basically click fraud. And then I'll end with the form fills, right, the cost per lead and all that kind of stuff and talk about how performance marketers should not assume that they're immune from fraud. Right, a lot of B2B performance marketers say, oh, we don't care because we're only paying for the lead, okay. Well, is that lead real? Okay, so I'll get to that in a second.

Dr. Augustine Fou: 17:02

Seriously, let me go back to click fraud, because that's the most basic form and we saw this 15 years ago and that's kind of what got me into the fraud research, right. So when you put up a banner ad on Yahoo, you know you're basically crossing your fingers and hoping that someone's going to click on it, because that would indicate that there was some interest in it. Right, and when you click through on a banner ad, you come to the site and that kind of stuff. So in the very early days, clicks and click rates were used as a proxy for success. Right, the more clicks you got, okay, the campaign's working really great. And in the early days that was a good indicator, right Before the bots got involved, right? So when a human deliberately clicked on an ad, that means they actually were interested, and when they get to your landing page, they'll probably look around at your content and maybe even buy something from you. Okay, so that was perfectly fine in the good old days. But because a lot of people started focusing on the clicks, the bots then said, oh well, why don't we just click on stuff to make it look like it's performing? And that's how we can trick the advertisers into giving us more money, right, allocating more budget to those sites. So, even with search ads, in the very beginning, there are ads that ran on Google's main property search ads, and there's also something called the search partner network, which were all of the outside websites that also ran Google search ads for revenue. Right, so they would get part of the revenue. Google would get the other part. Right, they'd do a revenue share.

Dr. Augustine Fou: 18:27

Now, because of that, it created the incentive for those sites to cheat. We could make more money when there's more clicks. So if there's not enough humans clicking right, because, again, humans don't click on search ads more than say 1% and humans don't click on display ads more than say 0.1% right, one in a thousand. So how do we make that number larger? Okay, we start cheating. We use bots because we can make the bots click on 100% of the stuff, because we need to click in order for us to make the money. So it created the incentive. So now the bad guys would set up all these fake websites.

Dr. Augustine Fou: 19:04

So very early on in our research, we saw countless sites that were solely based on search keywords. So not only the domain would contain those, but all the content on the pages would contain search keywords and things like that. So when people got there and then they clicked on something, that's how those sites make money because they're part of the Google search partner network. So that created a lot of click fraud in the very beginning and that was success. And when we saw more clicks, the advertisers said, oh, while these campaigns are working, awesome, let's now move more money into digital and pay for these things.

Dr. Augustine Fou: 19:40

Now, when you actually looked under the hood a little bit more, right? So one of the earliest examples for a pharma company is we saw a blended average click rate of 9%, greater than 9%. Okay, that seems odd, because even humans don't click on search ads that much. Right, it's higher than display ads, but not at 9%. Okay, that seems odd, because even humans don't click on search ads that much. Right, it's higher than display ads, but not at 9%. And then, when you started unpacking that again, this goes back to just common sense we said, okay, well, can you show us a report on a domain by domain basis? Right, we don't want to see the big average, because that's average across everything. Once we broke out domain by domain, we saw a whole bunch of domains pegged at 100% click-through rates. That doesn't make any sense, right, and that's tens of thousands of ad impressions and clicks. Well, broke out with sufficient detail. Right, the average is kind of hide those details from you, right, but when you actually break it out and see line by line, how the heck are some of these websites getting 100% click-through rates? Okay, oh, by the way, these all look like fraudulent sites when you actually visit them. That's how we started uncovering the fraud, even without any specialized technologies, right, it's really about asking for enough details so that you can kind of break through those averages, because the averages hide the fraud very easily for you or from you. So when you look at the details, you can already say, okay, we got to turn off all of these sites because they're completely fraudulent. Now, that was very simple and that was rampant amounts of click fraud more than 20 years ago.

Dr. Augustine Fou: 21:12

And then now fast forward to today and let me kind of get into the opposite end of the spectrum, which is the performance marketers and a lot of B2B ones are performance marketers right, they'll say we only pay for the lead, we're not going to pay for the impression, we're not going to pay for the click, we only pay when we get the outcome that we want, which is a lead. Okay, so, like I said earlier in this podcast, the bots will do exactly what you pay for, right, what you want to pay for, in this case, the leads. So, when you have a lead form, they will fill it out completely, submit it, right, they'll even solve the CAPTCHA and then submit it to you. So now you're paying, you know, $5 per lead, $50 per lead, sometimes $500 per lead. Now, in those cases, let me again tell you how we use very simple common sense to detect this.

Dr. Augustine Fou: 22:00

If you see a lead form submitted in one second, okay, is it even humanly possible for a human to fill out all the forms fields in your form and submit it in one second? Okay, obviously not. But the bot has all of the data right From a database somewhere of stolen information. By the way, to complete your form and solve the captain, submit it in one second. Just by having basic code on page we can say, okay, this doesn't make any sense. So therefore this is a fake lead. Even if every field in there, right, the zip code matches the city, the phone number area code matches the city, all that kind of stuff, Everything matches up, everything looks right. But it's not real. It wasn't submitted by a human.

Dr. Augustine Fou: 22:45

Another very simple thing that advertisers are doing is just adding invisible fields to the form. A human can't see it, so they couldn't possibly have filled it out and submitted it. A bot will see every form, every field on that form, and submit it. So when you get these form fills that have those fields completed, you know definitely a human didn't do it, so then you can just discard those outright. But those are various techniques. I'm sure the bots will get better. We talk about AI agents buying stuff for you or filling out forms. Even the purchase can be done easily by bots, right? You've seen these cases where Taylor Swift's tickets were basically all purchased up within 15 minutes of the launch by scalper bots right, the bots will buy all the tickets so that scalpers can sell them for five times the money on the aftermarket. Right. So bots can do anything that a human can do in a browser. It's just whether they have a financial motive to do that thing. If they're paid for that, they will do exactly that.

Kevin Kerner: 23:45

Golly, you know what I love about what you're saying here. It's so what you're asking, the questions you're asking are so simple. Like could it be? Would it be possible to have that like in a second, or would it be possible? It's really. I guess there's so much believability behind the ad industry. You're just like what.

Dr. Augustine Fou: 24:03

They said it was someone looked at this. They just didn't ask those questions.

Kevin Kerner: 24:07

But, to me we're not asking the right questions. You know, one thing I loved about the stuff that I read before our call was that you were asking the question, or you're making the point that there's a difference between someone actually doing something with an ad versus just seeing an ad. It's not just the attention side, it's the attentiveness side. Can you break that down a bit, because I think it was really that's the point. You know what you need to determine if someone has attentiveness with the ad. Is that correct?

Dr. Augustine Fou: 24:34

Yeah. So let me kind of put it in context, because a lot of people have heard of the term viewability. They've also recently heard the term attention and I think a lot of advertisers are optimizing for attention. I'm going to put a third term into this mix and I'm going to call it attentiveness. But before I get to attentiveness, let me kind of set the context by talking about those first two.

Dr. Augustine Fou: 24:54

So viewability is a very basic concept and it kind of makes common sense as well. It's the viewability of the ad itself, right, so whether the ad was viewable. So the main concept and there's some standards around this now which is 50% of the pixels of the ad in view for one second, because the common logic will say if the ad itself wasn't even viewable, then people couldn't have seen it, it couldn't have had any kind of impact whatever. It makes total sense. So it basically means that advertisers want to buy viewable ads versus non-viewable ads. Now, that's a good idea in theory, but what has happened in the real world is that the bad guys have easily faked the viewability measurements or they've basically stacked all their ads above the fold so they register as 100% viewable even if they're not right. When you stack ads. Say, 50 ads on top of each other, only the top one is visible or viewable right, the other 49 are behind it. So obviously, a human can't see it, even though the detection tech will all register it as viewable okay, because it was above the fold in the viewport and all that kind of stuff. So, again in digital, there's easy technical ways for the bots or bad guys to fake any metric that you want to see. And in 2018, there was a case where Newsweek a mainstream publisher right, supposedly publisher was using very simple JavaScript code to just falsify the viewability measurement to make all of their ads look like they were 100% viewable. So, when the advertisers think they're buying 100% viewable ads, they got to ask the next question okay, were they actually viewable? Okay, so, that being said, we now move to what you just mentioned attention, which is okay.

Dr. Augustine Fou: 26:37

Here's the next evolution of viewability. Right, the viewability has to do with the ad itself. Attention, which means they drive more business outcomes, makes total sense, because a larger ad that gets your attention will obviously perform better and drive more business outcomes than a small ad that you may not have even seen. Like you skipped it, or it was too. It was on the bottom. So you didn't even look down at the bottom of the screen or something, right? So higher attention means better outcomes, makes total sense. The problem that a lot of people don't really understand is that you can't actually measure attention in real life, in real campaigns. Right, you can measure it in an eye tracking study in a laboratory environment, but you can't measure it in real life because the JavaScript is not allowed to turn on your camera to see if you were actually looking at the screen. Right, it would throw a prompt, a user prompt, security issue if it tried to access your camera. Yeah, no one's going to do that no one's going to do that.

Dr. Augustine Fou: 27:56

And that's what I meant by attention. Vendors can't actually measure attention because they can't show you that the person was actually looking at the screen the moment the ad showed up. So then the optimizations that end up happening right when you're optimizing for higher attention means you're basically optimizing for larger ads, because an ad that covers up the entire screen obviously gets more attention than an ad that doesn't cover up the entire screen, that's hidden on the very bottom right, a mobile ad or whatever. So basically that's still fine, right Directionally. More attention gets you more outcomes, that's totally fine. I'm not saying don't use it, but there's a better way and I'm a scientist so I want to make sure I can measure it. So that's where attentiveness comes in. And attentiveness doesn't happen on the ad and doesn't happen on the person's device, because we can't turn on the camera.

Dr. Augustine Fou: 28:46

Attention, attentiveness happens on the advertiser's landing page. That's the page to which the user clicks after they click the ad. And, like I said earlier, if a human deliberately clicked an ad, that means they were kind of inspired by it and they were curious about something. That means they were kind of inspired by it and they were curious about something. So when they clicked on it, when they get to your website they're probably going to do something like look at the content, move around on the page. So there are certain human signals, like mouse movement, page scrolling, click events, maybe touch events if it's on a smartphone that we can actually see and directly measure on the landing page of the advertiser. So attentiveness is a very simple concept. It's basically the collection of these human interaction events mouse movement, page scrolling, clicks, touch events and the percentage of users that actually did that when they got there. So if the majority of the users that clicked on your ad and got to your landing page actually did something on your landing page, we call that high attentiveness, and when maybe 1% of the users that got to your landing page only did something, we call that very low attentiveness.

Dr. Augustine Fou: 29:59

So you can now use attentiveness to gauge the relative effectiveness of your ads, and attentiveness actually takes into account both viewability and attention already, because the ad would have had to have been viewable and then the person would have had to pay attention to it and then click on it and attentiveness on the landing page. That's a good thing, because if they came to your site or active on your site and did something. That's a step towards a conversion. So higher attentiveness on the advertiser's landing page is better than lower attentiveness or no attentiveness on the landing page. And in fact, zero attentiveness is the same as what you might see in your own Google Analytics as 100% bounce rates or zero time on site. Right, they left right away without doing anything. So I think in that case, just to kind of reiterate viewability, attention and attentiveness, I would prefer to measure attentiveness on the landing page because it already takes into account viewability and attention.

Kevin Kerner: 31:08

So simple and so logical. These are really easy questions.

Dr. Augustine Fou: 31:12

Yeah, I've been thinking about this for a long time, you know there are simple things, non-technical things that advertisers can do to make their B2B campaigns way better.

Kevin Kerner: 31:22

Yeah, it's really a blind spot. You know it's a blind spot for, I'm sure, a lot of CMOs, a lot of people in performance marketing, because you're just trusting that the system works. It has to work. You know, it's been around for so long. The one thing I wanted to ask you very quickly about is attribution. We get a lot of skepticism on attribution from technology marketers and I think it's you know, part of it. They're trying to say to their executive leadership team here's the stuff that's working, so let's spend more. And then part of it is performance based. It's like what is working and how am I going to? You know what am I going to invest in more? How should CMOs or performance marketers and B2Bs start thinking about attribution? Like how should they trust it at all? How?

Dr. Augustine Fou: 32:03

do they validate performance? I would say they can trust it, but they should be skeptical. Right, there should be a healthy, healthy amount of skepticism. And let me kind of explain why. Right, so the concept of attribution is attributing sales and outcomes to the ad that caused it right, or the ad impressions that caused it right. That's great, that's fine.

Dr. Augustine Fou: 32:24

But what has happened is that a lot of these attribution models are literally just that they're models, right, they're mathematical models, methodologies to attribute sales. So let me use a very simple way to explain this. Right, you've all heard of attribution windows, right? And those can be set to one week to 30 days, 60 days, whatever. The attribution window is the time that you would basically look at after the ad exposure to say, ok, if any sales occur in that window of time 30 days, 60 days, whatever then we can attribute that sale or that outcome event to the ad exposure, the ad exposure. Now what has happened is that people can very easily game the attribution reporting to make it look like they got a lot of outcomes, simply by changing the attribution window. So say, for example, you set the window to one week, you have ad exposure, you wait for seven days and see if any sales occurred. If it did, then you would attribute. And then you're a marketer and say, oh, there's actually too few sales that occurred in that first week. Why don't we wait for longer? Why don't we wait two weeks? Why don't we wait for 30 days? See if any sales occurred. So it kind of depends on the product, right? So some products take longer to sell, especially B2B. Those are very long sales window.

Dr. Augustine Fou: 33:42

By adjusting the attribution window, they can now say we just got a lot more sales attributed to these ads simply because they waited longer. Now what happens if you really want to cheat and say, okay, why don't we make it 60 days? Why don't we make it 90 days? Okay, how about we make it half a year? So any sale that happened in the half a year we can now attribute back to the ad impression. Yay, okay. So you see how easily the ROAS or ROI reporting, the attribution reporting, can be tricked to be made to appear better, right? So that's where the marketers have to really understand their particular vertical, their industry, their product category, whatever. So certain products, like small ticket items, attribution window should be very, very short. Can of soda, very short. B2b it could be six months.

Kevin Kerner: 34:30

That could be a legit attribution window, and it's a very complex journey too.

Dr. Augustine Fou: 34:35

Yeah, exactly A lot of people involved, and they're interacting with all kinds of stuff, so the marketers need to be honest with themselves in setting the attribution window, but that's what I meant by you know, if you let someone else set the attribution window, or you don't even know what the attribution window is because the platform just gave you a ROAS report, you could be very easily tricked into thinking something's working when it actually is not. It's simply claiming credit for sales that either had occurred in the past or would have occurred anyway, right?

Dr. Augustine Fou: 35:05

It's simply a figment of how they did the reporting, the attribution reporting, right. So it's not to say it's a bad thing. You just have to understand the limitations and be very skeptical yourself to make sure you're getting the right numbers, so that you understand where to allocate more budget because it actually is working, not because it looks like it's working.

Kevin Kerner: 35:24

Yeah, really good advice, Really good advice. The last question here, and then I want to get into AI roulette. There's going to be a lot more content created and potentially even like look what Meta is doing with trying to make advertising easy for the small business. Is AI the? Will AI be the problem, or is there something in AI that will be the solution in all this as a fraud?

Dr. Augustine Fou: 35:47

researcher. I'll tell you AI is going to cause more problems than it will ever be the solution for. And, very simply, you know, it's actually a useful thing for small businesses, like if they have certain product pictures right of the stuff that they're selling. It is trivial and it makes total sense to let AI generate the banner ads for you. You don't need humans to do that, so there are certain ways you can use AI to your advantage, obviously. So even automating some of those processes would not be a bad thing for small and medium businesses, who may not have a creative agency to do that for them. They don't need to pay a creative agency to do stuff that's going to be templatized and easy to automate anyway.

Dr. Augustine Fou: 36:26

However, like we said earlier, for 15 years, bad guys have simply been plagiarizing content from other places pictures and texts and just putting it on their WordPress templates to make fake websites. With AI, they don't need to plagiarize it anymore. Ai has already done it for them. They'll just generate the content. So the proliferation of more fake sites is just going to be easier and easier going forward. That just means that we're democratizing crime. We're democratizing ad fraud, so more people can just sit in their armchair at home and do ad fraud. But, that being said, if you really understand that fraud has been at the 90% level for the last 15 years, a little bit more of it due to AI is not going to really matter. Right, you're still going to what you're going to get to like 92%.

Kevin Kerner: 37:11

That's going to be the problem, yeah just went up by 1%, okay.

Dr. Augustine Fou: 37:14

So I think a lot of people think that ad fraud was 1% for the last 15 years. So it's probably going to be shocking to them when they realize 90% of their stuff is not shown to humans. And I think you asked the question earlier in this podcast to say what can advertisers do? They can probably save 90% of their digital budgets right now and do better Talk about ROAS. If you're saving that money, every dollar saved goes straight to your bottom line, your profit. So that's enormous ROAS that marketers can do. That's the cheat code right here. Right, they can actually show way more ROAS simply by not spending the dollar than spending it on showing ads to bots.

Kevin Kerner: 37:58

Yeah, incredible, absolutely incredible. Do people really think you're crazy?

Dr. Augustine Fou: 38:01

Absolutely right. I've been a pariah for the last 15 years and I'm totally okay with that, because I think you know, when we're talking about this, there are going to be a handful of marketers will say, oh shit, we better do something different, because all of our assumptions may not have been correct for the last 15 years, but there's going to be a whole bunch of them will say well, I prefer doing what I'm doing right now.

Dr. Augustine Fou: 38:23

I don't want to lose my job over this. So they're just going to not listen to it. But I'm fine with that too, right?

Kevin Kerner: 38:28

So and you and you have the weight of the whole advertising industry.

Dr. Augustine Fou: 38:32

really, they're all in con right now. Right they're. They're all drinking rosé and patting each other on the back so. I'm fine, I'm still here in New York, but.

Kevin Kerner: 38:46

I love it, I love my. The rebel inside me loves the fight. I just love the fight. You're out, so I'm I'm a fan, all right, sure, okay, I warned you about this. I do an ai roulette question at the end.

Dr. Augustine Fou: 38:51

So now we're gonna get to the hardest question of all just the best question, okay, and so let me.

Kevin Kerner: 38:59

so what I did is I loaded, uh, perplexity up with your a couple of the research reports, the questions that I was going to think about asking here, and your LinkedIn profile, and so I'm going to push, send on Perplexity and let's see what it gives us here. It's going to give you a question that you'll have to answer on the spot. Okay, here it goes.

Dr. Augustine Fou: 39:17

Oh man, it's really roulette. You just actually submitted in real time. Yes, all right, okay.

Kevin Kerner: 39:22

All right, okay, it hasn't blown up yet. Okay, but this could be the inaugural one. So here we go. If you had a magic button that, when pressed, would instantly reveal to every CMO and brand exactly how much their digital ad spend is wasted on fraud and who in their organization or agency has been knowingly ignoring it, do you think the industry would actually change for the better, or would it just lead to mass chaos, finger pointing and maybe even the collapse of some of the biggest players? Would you press it? Why or why not?

Dr. Augustine Fou: 39:55

I wouldn't press it because from 15 years of experience it won't do anything. They will literally schedule next year's con and just all go to con and ignore it. I've seen this for 15 years. The story is not going to change.

Kevin Kerner: 40:09

That is so awesome. So the nuclear option. There's no mutual self-destruction in any of this.

Dr. Augustine Fou: 40:14

It's like, okay, whenever they come around, I'm going to be here.

Kevin Kerner: 40:18

That is so great. That is so great. Well, this has been amazing. I mean, I've just been sitting back soaking it all in. I'm so delighted to have you on the podcast and to get your information out, particularly to the tech and B2B space. This has really been fantastic. Thanks, Kevin. If people want to take the next step and get a hold of you or get more information, what's the best way to?

Dr. Augustine Fou: 40:45

information. What's the best way to? Most of my content is actually on LinkedIn, so there's 800 plus articles from the past 15 years. It's all published on LinkedIn. So just find me on LinkedIn, follow me if you'd like and just reach out directly. Right? It's just augustinfu at fuanalyticscom, f-o-u analyticscom, happy to answer any questions. I'm always happy to support an advertiser who really is brave enough to take a look more closely under the hood, because that's really the first step. Right, we can't solve fraud overnight, but we need these baby steps and we need more advertisers to have the courage to take that first step, and I'm here to help.

Kevin Kerner: 41:17

Yeah, I love it. Well, thank you. Thank you so much, dr Fu. We'll stay connected and keep fighting the good fight. Thank you, kevin, good to see you. All right, talk soon.

‍