Why talk about ad fraud in the context of Programmatic Advertising? Because with removing (or reducing) the human contact in the booking, ad placement and ad trafficking process, the possibility of ad fraud occurring increases. It is something not only we should be aware of, but we ought to do everything possible to circumvent, or at best reduce.
For those unfamiliar with the digital advertising landscape it may come as a surprise that some of the online adverts that are served may never actually get to be seen by a human being. A part of this is due to people opting out (e.g. closing the website before it has a chance to load the ad), or due to the ad placement being on a part of the page that even though loads, is not displayed on the visible part of the screen (e.g. the ad is below the fold).
However another, and a rather larger part of the ads are never seen because of ad fraud, or in other words non-human traffic. Some estimate (Reuters) the volume of this to be 25% of video and 11% of display ads. Some estimates are higher (WSJ), although no one knows what the exact number is. However, considering that the total digital ad market is estimated to be worth $600bn in 2015 (by eMarketer), even if we only take 1% of that, it is a whopping $6bn that is spent by advertisers yet the message reaches anyone.
For advertisers it's important to ask tough questions from the DSPs they use on their capability of filtering out fraudulent activity. For SSPs it's equally important that they vet the sites they do business with, and for Exchanges to filter out questionable content and or environments. We are all responsible to fight fraud with adopting new technologies and safeguards to, if not making it impossible, but at least make it difficult for fraud to take place.
I see no silver bullet, rather an ongoing commitment to stay ahead or very close to those who are trying to cheat the system.