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Gridsum Publishes White Paper on Ad Fraud in China’s Internet Advertising Industry

Gridsum published its white paper on ad fraud which consists of over two years of invalid traffic monitoring across China's internet advertising industry.

BEIJING, CHINA / / March 19, 2018 – Gridsum Holding Inc. (“Gridsum” or the “Company”) (NASDAQ: GSUM), a leading provider of cloud-based big-data analytics and artificial intelligence (“AI”) solutions in China, today announced that it has published a white paper on ad fraud in China’s internet advertising industry to commemorate World Consumers Rights Day on March 15, 2018.

Gridsum began analyzing ad fraud, also referred to as invalid traffic, in 2013 when it joined the China Advertising Association (“CAA”) and Mobile Marketing Association China (“MMA China”) to participate in the creation of ad fraud standards for China’s internet advertising industry. With the support of the CAA and MMA China, Gridsum leveraged its deep experience in big data analysis and AI to develop a powerful invalid traffic monitoring system. To commemorate World Consumers Rights Day on March 15, 2018, Gridsum published its white paper on ad fraud which consists of over two years of invalid traffic monitoring across China’s internet advertising industry.

Key findings from the white paper include: Invalid impressions accounted for 33.9% of all impressions in 2017, a slight decrease from 38.8% in 2016. Invalid clicks accounted for 23.2% of all clicks in 2017, a slight increase from 21.7% in 2016. Invalid impressions peaked during the third quarter of 2017 at 32.3%. Invalid clicks peaked during the second quarter of 2017 at 24.4%. Across the four primary forms of internet content which include industry verticals, portals, online videos and ad networks, invalid impressions were highest for industry verticals and ad networks at approximately 40% in 2017. Invalid exposure rates declined across all four forms of internet content in 2017 compared to 2016. Invalid clicks declined across all four forms of internet content in 2017, among which industry verticals experienced the greatest decrease. Invalid click ratios for automobile, FMCG and consumer electronics decreased in 2017 while invalid click ratio for internet technology increase by 1.1 percentage points in 2017. As traffic increasingly shifts to mobile devices, invalid traffic has become problematic for mobile advertising. Invalid impressions for mobile advertising trended downwards in 2016 and 2017 when compared with invalid impressions for PC advertising. Invalid impressions and clicks for mobile advertising trended upwards in 2017.

Mr. Guosheng Qi, Chief Executive Officer of Gridsum, commented, “We released our white paper to provide data to advertising and digital media agencies and promote the healthy and sustainable development of the internet advertising industry. Leveraging our big data capabilities, we are able to provide industry professionals with what we believe to be very helpful analysis on invalid impressions and clicks, frequency, geographic origins, website heat maps, user behavior and other multi-dimensional indicators. We will continue to work with authoritative organizations and companies across the industry to help clean up China’s internet advertising industry, promote increased transparency of advertising data and construct a healthy and sustainable internet marketing ecosystem. In addition, Gridsum’s Marketing Automation Solutions use market-leading machine learning and AI technologies to automatically detect and prevent paid click fraud for our clients. This is one of the ways that Gridsum helps increase our clients’ marketing ROI and business KPIs in a timely and quantifiable manner.”

Gridsum has made the Gridsum Real Time Invalid Ad. Traffic Monitoring Service available on its product website.