Evaluating the Impact of Methbot – The ‘Most Profitable Ad Fraud Operation’ in History

In December 2016, the cybersecurity firm White Ops introduced the world to Methbot – “the largest and most profitable ad fraud operation to strike digital advertising to date.” White Ops’ report said the Methbot operation, which got its name from drug references in the bot’s code, had been tricking advertisers into buying 200-300 million bogus video ad impressions a day at an average cost per thousand impressions (CPM) of $13.04. Add it all up and that’s an estimated $5 million a day worth of fabricated video ad impressions. The report sent shockwaves through the digital advertising community and was picked up by major media outlets like CNN, Forbes, The New York Times and others. Despite the media coverage, it’s still unclear how much damage Methbot actually inflicted on digital advertisers.

So, how does Methbot work?

When someone visits a website or app with unsold ad space it sparks an auction between advertisers. In most programmatic transactions, there is no direct contact between advertiser and publisher. Multiple third parties work to automate the buys by bundling up ad impressions and selling them a thousand at a time.

Check out the White Ops report  for an in-depth look at Methbot.

Methbot avoided all that by removing publishers and audiences from the equation. First, the Methbot operation fabricated thousands of webpages with just the elements needed to serve video ads using the domain names of premium publishers. Each time someone visited one of the faux pages, a video player would send a request to an ad network with an available impression from what looked like a legitimate website. That took care of the publishers, but Methbot’s operators still needed an audience to populate their digital Potemkin village. Most ad fraud operations manufacture bogus impressions by hacking existing IP addresses (the ID linking users to their online activity) and force residential computers to visit sites without the user knowing. But the method is outdated and easy for advertisers to catch. That’s why Methbot’s operators decided to buy about $4 million of new IP addresses which they used to create fake web sessions with elements a real user would have like browser history and social login information. Along the way, Methbot’s creators incorporated a variety of additional tactics to mask their activity, but digital advertisers have been dealing with fraud for years and know how to spot it.

Methbot, or ‘Mehbot?’

Despite the reported impact of Methbot, the ad industry response has ranged from indifferent to dismissive. Many in the industry believe the sophistication and impact of the operation were overblown. “It’s pretty clear that we shut down this particular scheme long ago. While it was sophisticated in some ways, it wasn’t very hard to stop,” the CEO of AppNexus Brian O’Kelley wrote in a post on Medium. “I’m incredibly frustrated that we continue to fire off huge numbers… and then when you actually run the numbers, the impact is dramatically less.” Integral Ad Science’s (IAS) Jason Shaw published a blog post titled “Methbot? More Like Mehbot” echoing O’Kelley’s sentiment on Methbot’s sophistication, or lack thereof, and also questioned the financial windfall of the operation. “Have the fraudsters behind Methbot recouped their ($4 million) investment in IP address allocation? Probably,” Shaw said. “Have they extracted over a billion dollars? Doubtful.” This seems like a good place to point out that a lot of programmatic ad inventory goes unsold. White Ops based their $3-$5 million per day estimate on the auction value of the bid requests, not actual sales. If fraud detection tools spot dubious signals, they shut down the transaction and no money changes hands.

The industry response to Methbot

White Ops didn’t release a list of companies hit by Methbot, but a number of digital ad companies have stepped forward to share their findings.


“After conducting our own analysis, we’re pleased to report that the inventory and ad quality tools and processes we have in place mitigated the impact of Methbot on our publishers and demand partners. In fact, less than 0.002 percent of the impressions on our platform were affected…”

– Anand Das – Co-founder and CTO, company blog post


“During a rigorous discovery process to determine the impact of Methbot on advertisers using the DataXu platform, the company found that only .08 percent of daily media spend in December could be attributed to fraudulent Methbot IP addresses.”

– Company press release

Index Exchange

“(Index Exchange has only seen) 14 impressions against the 571,904 IP addresses identified by White Ops, over a December platform wide log pull, relative to billions of impressions delivered on the platform in the same timeframe.”

– Andrew Casale – President and CEO, company blog post


“The impact on our advertisers is very low. We have been seeing significantly less than 1/10th of one percent of spend on our platform to the IP ranges affected.”

– Company blog post

*Disclosure: Simpli.fi is a Mindstream agency partner Other companies have released similar findings – including comScore, OpenX and The Trade Desk – but it doesn’t mean that Methbot didn’t have an impact on the industry as a whole. It’s a small sample and there are a variety of factors that make it difficult for any company to judge how many ad transactions were compromised by Methbot.

How big of a deal is this?

It’s difficult to gauge the total damage Methbot inflicted. On one side, we have major ad companies – who have a serious incentive to not fall victim to ad fraud – claiming that Methbot’s impact was minimal (at least on their platforms). On the other side, there’s White Ops – an ad fraud detection company whose business model depends on advertisers falling victim to fraud – claiming that Methbot is the “most profitable ad fraud operation” in history. It’s likely that the ad companies with up-to-date technologies were able to mitigate most of the damage, but there are thousands of ad platforms, exchanges and networks that carry out ad buys, each with varying levels of detection capabilities. So, unless the group behind Methbot decides to open their books, we may never know the full impact.

Top Digital Marketing Predictions for 2017

2017 is here. And, whether 2016 was good for you, awful for you or just made you shake your head, it’s officially done and over.

This time of year is great for looking back on the year that was and looking forward to what we think the next year will be. We’ll start with a review of what actually happened in 2016 compared to what we thought would happen – then, we’ll offer our best guesses on what will happen in 2017.

2016 in Review

At the beginning of 2016, we predicted that mobile, voice search, digital assistants and marketing automation would be big players. Well, we were mostly correct.


Mobile usage definitely grew in 2016. According to eMarketer’s mobile reports, mobile search on Google increased by 11 percent and m-commerce (online shopping on mobile devices) saw an increase of over 15 percent.

Google’s 2015 “Mobilegeddon” update made mobile optimization a much larger factor in search engine rankings and that trend continued through 2016. Consistent user experiences across devices became a primary concern for advertisers as consumers and search engines demanded that smartphone usage be fully acknowledged. Overall, mobile was not something you could afford to ignore last year.


Automating marketing campaigns has certainly become much more common. Marketing automation has led to campaigns that can be tweaked daily with little additional work from the client. However, automation removes some of the personalization aspects that clients and consumers are looking for today. Near the end of the year, we saw many campaigns looking to strike a balance between optimization and personalization.

Voice search and digital assistants

Voice search and digital assistants have become available on nearly every smartphone and tablet made, as well as many computers. Consumers increasingly turned to Siri, Alexa and Cortana in 2016 to find the answers to life’s most urgent questions. However, these searches didn’t yield as many direct calls to businesses as many marketers, including us, predicted in early 2016. While many people search for general information and businesses using voice search or their mobile assistants, many of those same people wait to call the business until later, merely visit the store or continue comparing products or services. This makes attribution to these search methods difficult to accurately calculate. Plus, many of these search features are difficult to customize strategy for.

What else was big?
Live content and experiential marketing

Companies like Taco Bell and Warner Brothers used experiences to build their brand. Taco Bell hosted a “Friendsgiving” dinner for online fans. And, rather than giving away swag at SXSW, Warner Bros. promoted their film with a Harley Quinn themed tattoo shop and complimentary temporary and permanent tattoos. These are just a couple examples pulled from a vast number of times last year that companies gained new followers, leads and fans by promoting an experience rather than a product.

*Source: Official Suicide Squad Instagram page

Predictions for 2017
Mobile wallets

Mindstream Media Group’s own Amelia Monroe found that mobile wallets were one of the hot topics at this year Consumer Electronics Show (CES) in Las Vegas earlier this month.

Mobile wallets have been around since 2011 when Google released the aptly named “Google Wallet.” If you’re not familiar, mobile wallets are apps you can install on your mobile phone to store credit card and bank information. Users can then make purchases in physical retail locations by using the app instead of an actual credit card.

Mobile wallet adoption up to this point has been slow, but the industry is poised for explosive growth in 2017. Millennials have started to use mobile wallets more and more, with 45 percent of young adults saying they’ve used a mobile wallet for payments, according to Square. At CES, Samsung’s Nana Murugesan reported that the number of Samsung Pay users nearly doubles every week.

What’s boosting engagement? A few things. First, Samsung Pay recently rolled out a rewards program towards the end of last year. Second, mobile wallets are becoming more integrated with other technology. Honda announced at CES that they will be integrating payment options into new cars that allow users to pay for fuel and parking from their car.

Live video

Video has been king for a while online, and now sites are using live video to connect with more immediacy to users. YouTube, Twitter, Facebook and Snapchat were the beginning and 2017 will see other sites jumping into the mix.

Facebook Live has taken off since its debut in early 2016. Started as a beta test, it has quickly become common practice amongst both marketers and everyday users. A recent live concert streamed by the band OneRepublic garnered nearly 400,000 live watchers. A BuzzFeed video featuring an exploding watermelon had 800,000 live viewers and more than 10 million video views since it was posted.

Predictions by eMarketer and LSA both suggest that an online live video broadcast will hit primetime television viewer numbers in the upcoming months. Bands, celebrities, shows and brands are all starting to take advantage of this medium and it will be interesting to see how viewership and its use as a marketing tool changes as the year goes along.

Messaging Apps

Advertising on messaging apps like Snapchat has been a bit of a hit or miss. In the coming year, we expect Snapchat to make some changes to the app’s advertising format which should help increase marketers’ ability to attribute leads. The key here is to know your audience and ensure that whichever app you’re using, whether it’s Snapchat, Yik Yak or one of the many others, is the right one for your target demographics. Plus, those marketers that get in on the ground floor are going to be ahead of the curve. So, while everyone else works to catch up, you’ll have worked out the kinks while ad costs are still low.

Personalization and the customer journey

The days of box-style personas are nearly over. Customers are being looked at with regard to where they are in their personal journey rather than what “box” they fit into. Customers are also looking for a bit more personalization than they used to when it comes to online ads. Campaigns will likely focus more on contextual targeting rather than generic audience targeting in order to hit those at the right stage in the buying cycle. It doesn’t matter as much if someone fits perfectly into your target audience customer description if they aren’t ready to purchase.

Live data

This ties in with greater personalization. Live data and a greater depth of knowledge on your audience and campaign results will lead to better targeting and more personalization. The use of larger quantities of data has grown and will continue to do so as advertisers and consumers alike demand strategically targeted and relevant ads.

[JANUARY 2017] The Latest from Google: YouTube to Improve Campaign Insights, New Message Extensions and Demographic Targeting Features for Paid Search

It’s no secret Google is always looking to deliver the most relevant experience. Since last year, the common thread throughout their search announcements has been a “mobile-first” focus. This trend will remain as consumers continue to reach for their mobile devices when a search need arises. Continue reading “[JANUARY 2017] The Latest from Google: YouTube to Improve Campaign Insights, New Message Extensions and Demographic Targeting Features for Paid Search”

The State of Digital Ad Blocking

While the future of ad blocking made 2016 and 2017 agency predictions lists worldwide, its evolution or devolution is still unfolding and likely will be for years.

Here’s where we stand today

According to eMarketer, an estimated 69.8 million U.S. internet users will employ ad blockers this year. Why? Because despite the smart people working in UX and marketing, too many publishers have made online ads annoying.

We’re not just talking about the occasional targeting error. At its worst, this is an in-your-face, page consuming, whack-a-mole invasion. Respondents to a recent MarketingSherpa survey cited large pop-ups as the primary reason they blocked ads.

*Source: MarketingSherpa

The same survey reported that only 10 percent of respondents said they don’t see the value in advertising as a reason for using ad blockers. There’s good news to be had in that low percentage. Consumers get it; ads make content possible, just like in other media. That’s partly why some are actually blocking the blockers. According to the Interactive Advertising Bureau’s (IAB) 2016 research report, 20 percent of consumers stopped using blockers when prompted or because a blocker removed content.

Interestingly, according to the IAB, the guys — men between 18 and 34 — most likely to use ad blockers are the same ones most likely to be convinced to turn them off. The fact that ads no longer bother them or that the blockers themselves slow down browsing ranked slightly above the other reasons for turning them off.

*Source: IAB

Advertisers and publishers play a critical role in shaping their own destiny. They know it, and they’re working on it. But anti-ad blockers and messages begging exchanges of ad views for content, or cash for content, aren’t winning the day.

Where we’re headed

Content – when it’s well written, aesthetically designed and properly targeted – is digestible. It’s livable. It can be either entertaining or economically valuable to the consumer. But, like television isn’t funded by year-round Super Bowl commercials drawing viewers to the screen, digital ads aren’t a sought-after means of financing the medium on a daily basis either.

So, there continues to be an awkward dance between ad blocking developers, publishers, advertisers and consumers where everyone wants to lead. Which brings us to this — everything is about to go up:

  1. Ad investment continues to increase. Advertisers are learning that digital brings in business. In fact, Edelman Digital predicts 2017 to be the first year digital spend will be greater than television.
  2. The risk to publishers goes up with it. Within three years, ad blocking will cost about $35 billion in ad revenue, according to Digiday.
  3. SEO and local search matter more. Optimizing the local search ranking system by ensuring location information is pristine to take advantage of Google’s local packs is crucial. Since these are organic results, business information will still appear seen even when blockers are activated.
  4. Increased consumer choice in ad preferences. Facebook and Twitter are among those making it easier for consumers to wave off ads they don’t value, opening up room for more relevant ads. Others are following.
  5. Greater return for advertisers. See above. Greater relevancy means greater engagement and a more direct purchase path for consumers.
  6. Government steps up. The European Union is proposing that publishers can deny content to consumers if they detect ad blocking software. China announced regulations last summer against ad blockers. Upcoming personnel changes under the Trump administration will likely move the subject up on the list of FCC considerations, shortly behind ongoing consumer privacy issues.
For the greater good

There’s no doubt ad blockers will, and already have begun to, force an improved user experience. The IAB cites top methods for getting users to ditch blockers:

  • Hiding content with a notice that the ad blocker is the cause
  • Cutting down on ad auto-play features
  • Not covering content on the page
  • Protecting users from malware infected ads
  • Ensuring ads don’t slow down pages

While ad blocking has proved to be a thorn in the side of publishers and advertisers alike, the trend does present an interesting opportunity. The state of a free internet depends on ad dollars for fuel and most users understand that. Audiences have indicated they’d be open to dropping the ad blockers for high-quality content and less-intrusive ad experiences. Now, it’s up to those serving the ads to provide that experience.

Tracking Consumer Behavior – The Importance of Cross-Device Attribution

As companies continue to wade into the open waters of digital marketing, the ability to account for users’ behavior across devices is crucial. Advertisers need to understand how to achieve cross-device attribution, analyze data and create appropriate advertising plans.

According to ExchangeWire, half of e-commerce transactions worldwide involve a cross-device purchase journey. We can bring that to life even more with this stat: the typical digital consumer owns more than 3 1/2 connected devices.

*Source: GlobalWebIndex, 2015

This shift in purchase journeys underscores the need for proper attribution of the digital consumer’s path – from awareness of the product, purchase consideration, loyalty to the product and advocacy of the product. Of the U.S. consumers using multiple devices in the path to purchase, 46 percent use desktop, 44 percent convert via smartphone and 43 percent via tablet, according to ExchangeWire.

In 2017, eMarketer predicts Facebook and Google will lead online-to-offline attribution. Currently, Facebook uses its own apps to track foot traffic while also partnering with Square, the magnet stripe reader for swiping credit cards, to get offline purchase information. The partnership between Facebook and Square allows the social media company to integrate data with point-of-sale systems. Google’s offline information attribution is not instantaneous, but uses the same avenues, according to eMarketer. This is seen in customer relationship management (CRM) systems and commerce application programming interfaces (APIs) across the board.

Monarch Airlines has had success with a partnership between Flashtalking and Tapad. The partnership allows Flashtalking to deliver new insights to marketers and provides a unified view of the customer journey. The use of cross-device marketing technology solutions has led to a 35 percent increase in display ROI for Monarch, according to ExchangeWire.

But this type of success is not ubiquitous. A 2016 survey by Econsultancy investigated the gaps between companies’ digital priorities and their capabilities. Nearly 75 percent of companies across North America stated “matching customers across multiple devices” as a top digital priority. However, only 14 percent of marketers in the survey said their company had the capabilities to handle such matching.

Digging deeper, Econsultancy discovered that although this priority is high on the list, only about 39 percent of marketers said they were able to understand their customers’ cross-device behaviors. This was lower than any other capability. The Interactive Advertising Bureau says U.S. marketers plan to devote more time and organizational resources to cross-device measurement and attribution in 2017.

This data also points out that cross-channel strategies versus advertising on multiple channels will make or break your marketing strategy. Brandon Wishnow, Executive Vice President of Measurement and Activation at Ovative/group, said, “there are probably more companies that are targeting media across devices than there are companies that actually understand the cross-device behavior of their customer base.”

In a recent eMarketer webinar, digital marketing contributor Lauren Fisher explained that a common mistake that companies make is marketing by devices rather than by the person who owns the device. Rather, consumers should be viewed singularly across all devices to extract the data needed for cross-device targeting.

The key to cross-device targeting is to understand the consumer, their research and shopping habits and to serve them appropriate messaging at the right time in the buying cycle. So with that in mind, here’s a list of tips to help advertisers master cross-device attribution courtesy of eMarketer.

Expanded metrics

Advertisers need to continue to develop a better understanding of the entire consumer purchase journey – this means being able to track users across devices and collect actionable data about their behavior. Forty percent of consumers expect brands to understand their offline purchasing data and advertisers need to create appropriate messaging based on that information.

TV ad buying

Advertisers should dedicate 35 percent of ad budgets to cross-screen TV ad buying. Connected TVs offer the most precise audience matching, but matching audiences to linear TV is the ultimate goal.

Creative capabilities

It’s important for brands to build a congruent and sequential narrative tailored to users, not the device they are using. Smartphone messaging must align with laptop messaging to keep the consumer moving towards a purchase; otherwise, you are constantly starting over with the same consumer.


Advertisers need to make sure campaign data and channel attribution are as accurate as possible. Here are a few strategies companies can employ to improve accuracy:

  • Include identity graphs in measurement providers
  • Move away from cookie-based solutions
  • Adopt cross-device attribution services
  • Converge traditional and digital attribution models
Data quality

As we covered above, data quality is crucial for brands trying to reach consumers across multiple devices. Here are four things marketers should consider while assessing quality issues:

  • How segments are created
  • The ability to use first-party data
  • How to onboard match rates and methodologies
  • The quantity of the data versus the quality of data

Webinar on Demand: Top Marketing Trends and Predictions for 2017

One of the best ways to beat the competition is to stay ahead of the digital marketing curve. Check out our latest Webinar for a recap on 2016 industry trends and what to look forward to in 2017.



Topics Covered:
  1. Marketing hits and misses of 2016
  2. Live video and how it’s taking off
  3. Messaging app advertising and how we expect it to change
  4. The best ways to use predictions to your business’ advantage


Featured Speakers:

Devin Range | Executive Vice President       Zac Keeney | Vice President, Business Development

Bailey Bosson | Director, Media Services     Adam de Jong | Director, Search Marketing