Bot activity at websites is skewing marketing analytics and costing businesses millions annually, according to a report released Tuesday by a bot detection and mitigation firm.
Netacea maintained in its report that the skewed analytics problem is as costly to businesses as click fraud.
Ad fraud costs businesses US$42 billion annually, or four percent of their revenue, the same percentage lost annually to skewed analytics, noted the report based on a survey of 440 businesses across the travel, entertainment, e-commerce, financial services, and telecom sectors in the U.S. and the U.K.
Of the businesses surveyed, 73 percent revealed they were affected by click fraud, which cost them an average of four percent annually, while 68 percent acknowledged they’d been affected by skewed analytics, with an average loss of 4.07 percent in lost revenue.
The report explained that bots are used by hackers to buy goods before other customers, hack accounts using stolen passwords, check the validity of stolen card details and steal content or prices by bulk scraping.
But even if they do not do damage directly, it continued, bots can skew data that leads marketing teams to make bad decisions. Analytics skewed by bots can hide what real customers are doing, making it impossible to target genuine audiences.
“Bots can skew all statistics because you’re not getting a feel for the real market,” said Rosemary Coates, president of Blue Silk Consulting, a business advisory firm in Los Gatos, Calif.
“It’s not true to the reality of what’s happening in the marketplace,” she told the E-Commerce Times.
Bad Data, Bad Decisions
That can be problematic for marketers who don’t monitor their campaigns on the fly. “They’re going to walk away from a campaign having spent a whole lot of money and getting zero returns,” observed Liz Miller, vice president and a principal analyst at Constellation Research, a technology research and advisory firm in Cupertino, Calif.
“Someone is running up a tab that the brand has to pay for,” she told the E-Commerce Times.
Skewed analytics can lead to bad marketing decisions, the report noted. In its survey, it found that more than half the businesses ran special promotions (54%), ordered new stock (55%), or “burned through” a marketing budget (55%) because of incorrect data caused by bots.
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