Experts predict revenue loss from ad fraud to surpass a whopping 44 billion dollars this year. This money isn’t a loss to advertisers only but takes from publishers’ pockets as well. 

In response to this issue (ad fraud, domain spoofing, etc.), in 2017, the IAB Tech Lab created the solution of ads.txt files. A solution meant to prevent the sale of counterfeit inventory as publishers navigate the advertising ecosystem.

Today, ads.txt files are becoming increasingly popular and even a requirement for certain ad exchanges and ad networks.

What Exactly Is Ads.txt?

Ads.txt is the IAB Tech Lab (IAB) initiative to increase transparency in the programmatic world. It’s short for “Authorized Digital Sellers” and allows you to declare the ad partners that can sell your inventory publicly. The text files essentially show where impressions are purchased from and resold. As a result, fraudsters will have a more difficult time selling publisher inventory that doesn’t belong to them — preventing domain hijacking and other types of fraud. It’s better protection for publisher inventory and a solid method to keep money in your digital pocket.

Is Ads.txt the same as App-Ads.txt?

App-ads.txt is a mobile extension of the IAB’s ads.txt file initiative. Both verify ad inventory and prevent fraud but on different platforms. So, publishers can incorporate app-ads.txt on mobile apps to declare authorized sellers and protect their ads.

How Does Ads.txt Work? Who Uses It?

The ads.txt file lists all the authorized partners that can sell publisher inventory in programmatic advertising. So, the publisher would add this text file onto their web server — which includes all ad exchanges, SSPs or DSPs authorized to partake in buying and selling.

Buyers can then check the validity before making a purchase. They check the bid request against the publisher’s account ID number to prove a sale is legitimate. It creates a secure method for programmatic buying.

Ads.txt files are beneficial to any publisher using ad tech to automate the selling process. It creates a safe way to bid without ad revenue being at risk of hijacking.

How Is Ads.txt Implemented?

Starting is as easy as creating a text file, naming it ads.txt, and uploading it to the root directory of your domain.

For publishers using WordPress, you can download an ads.txt plugin onto your website. Once downloaded, users click into Settings> Ads.txt to customize by placing their list and saving it. 

Both AdSense and Google Ad Manager recommend the use of ads.txt. AdSense provides a downloadable ads.txt file which includes your publisher ID. So long as it’s up to date, publishers can download the file and upload it to the root directory of their website. Check out this helpful list for more information. 

Publishers who want to implement ads.txt with other ad platforms will have just as easy of a time. You can create it in any text editor, such as Notepad or Microsoft Word. The file should have one line for every seller you wish to authorize in the domain in the following ads.txt specification format:

<Field #1>, <Field #2>, <Field #3>, <Field #4 – Optional >

The first three fields are mandatory. 

• Field 1- Domain name: Domain of the seller/reseller authorized to sell publisher’s inventory.
• Field 2 – Publisher account ID: The unique identification number associated with a publisher’s account (seller or reseller). 
• Field 3 – Account type: Publishers who’ve signed a direct contract with an advertising network will enter DIRECT. Publishers who have a company that acts on their behalf would enter RESELLER.
• Field4 – TAG ID: A unique identification code issued by TAG (Trustworthy Accountability Group). If the advertising system is certified, publishers can enter the TAG ID here.

Since ads.txt files are publicly viewable, they can be checked by typing in the root domain followed by /ads.txt. For example:

example.com/ads.txt. 

Advantages of Using Ads.txt

Publishers using ads.txt files benefit from protection against certain types of ad fraud and shady practices — and of course, advertiser confidence in buying your units. Even if it’s not a requirement, bloggers should consider adding it to their websites since installation is easy. Here are the benefits and advantages to consider.

Ease of use

Creating your ads.txt file is easy, and uploading it to your site takes mere minutes. We’ll go over this more in-depth as we continue. In addition to easy implementation, maintenance is also very simple. Publishers can update their files at any time, adding or removing sellers with the ads.txt formula.

Protection against inventory arbitrage

Inventory arbitrage is the practice of a middleman (agency, partner, etc.) buying inventory, then repackaging and selling it at a profit. These middlemen are essentially putting more money into their pockets instead of yours! As disheartening (and dare we say obnoxious) as this practice is, it’s not illegal. But since it hurts both advertisers and publishers alike, it’s essential to prevent this from happening. Otherwise, your reputation could be damaged by misrepresentation in the open market.

Protection against domain spoofing

In domain spoofing, a fraudster will mimic the URLs of real websites (which could be yours!) and attempt to mislead advertisers into purchasing ad space on a masked site. When advertisers buy these units rather than legitimate inventory, you lose out on revenue. Your website could lose credibility and deter networks from working with you in extreme cases.

Safety and security

Since ads.txt files can only be uploaded and edited by website owners, it’s highly safe and secure from external sabotage. Furthermore, without your website credentials, no scammer can manipulate the list. As a result, you’re always in control of your partnerships and protected against unauthorized reselling.

Disadvantages of Using Ads.txt

Limited protection 

It’s important to note it’s not a solve-all solution in the fight against ad fraud. In fact, the IAB has published an article on the use and purpose of Ad.Txt files. The report clearly states, “Ad fraud comes in a variety of forms, and ads.txt is not intended to solve for all forms.” So, publishers still need to take preventative measures — such as working with a quality ad platform and avoiding shady networks. 

Maintenance 

Keeping your ads.txt files clean and updated to date is pretty critical. Firstly, the IAB lab has launched a crawler that allows buyers to verify information quickly. Unfortunately, crawling errors can occur if the files are incorrect, leaving advertisers skeptical about working with you. Publishers can use the Google Webmaster service to ensure there are no crawling errors.

Additionally, like any determined scammer, those set on stealing from the advertising industry have found a way in. Its name: the 404bot. Its purpose: to capitalize on unaudited ads.txt files. 

The IAB has gone to great lengths to expose the 404bot scheme. In addition to recognizing its fingerprint, the IAB has determined its link to large files. Luckily, keeping a clean and tight ads.txt file can prevent you from incurring revenue loss due to fraud. 

Best Practices 

From implementation to management, here are some of the best practices to maximize effectiveness:

• Configure wisely: Sticking to the IAB format is the best way to ensure everything is working as it should. Accomplish this by using the format above and the precise number of spaces and commas. 
• Keep it short: Presentation-wise, your ads.Txt file should be readable and easy to understand. Publishers keeping giant files run the risk of files not being fully scanned by DSPs or the DSP ignoring the file entirely and disallowing programmatic channels for that domain. Additionally, short files will better help with fraud prevention as the 404bot is strongly correlated to how large ads.txt files are. 
• Regularly audit: Be sure to assess your ads.Txt file regularly. You’ll want to make certain partners are up-to-date, and any inactive ones are removed. Similarly, you should check your formatting and ensure your file is readable. Again, by validating your ads.Txt file, DSPs will be capable of scanning, and you’ll incur no revenue loss. 
• Give attention to direct deals: We mentioned keeping your file short and tight, and direct deals are a great way to do this. Consider offering contact information for direct deals to avoid having a host of resellers on file. 
• Consider its complement: ads.Txt files are great, even more so when publishers pair them with Sellers.json. The IAB recommends using Sellers.json as an extra layer of protection so that buyers can cross-reference a publisher’s relationship with their ad exchange or SSP. It works by having ad exchanges and SSPs list the publishers that work with them, their information (name, domain), and whether the relationship is direct or indirect.

Conclusion

Ads.txt effectively combats revenue loss due to fraud when used correctly. Any publisher using ads as a form of monetization should work to implement the text file on their site. This easy optimization strategy can save you money and keep you credible in your ad network’s eyes. If you’re looking for additional assistance, connect with one of our account reps today! We encourage all publishers to adopt this initiative and are happy to help you do it successfully.