14 June, 2016, it was announced that Impact Radius, the marketing and affiliate solutions platform, had acquired ad fraud detection and prevention platform, Forensiq, for an undisclosed sum, in a bid to offer a unique market proposition. According to the press release at the time, no company before had combined algorithmic attribution of consumer journey touchpoints with cutting-edge ad fraud detection to reveal insights that are not polluted by fraudulent data. Keen to understand more about the acquisition, the rationale behind it, and the future of the new entity, ExchangeWire spoke with Mark Wrighton, commercial director, Impact Radius; David Sendroff, co-founder and CEO, Forensiq; and Julia Smith, director of communications, Forensiq.

ExchangeWire: On the face of it, Forensiq seems like an unlikely acquisition for Impact Radius, known as an affiliate marketing platform – what was the rationale on both sides? How does fraud manifest itself within the Impact Radius platform?

Mark Wrighton: Both of those questions are intricately entwined. While Impact Radius were regarded as an affiliate marketing platform, focusing on the incrementality of the performance channel, about three to four years ago we shifted our business focus to looking at performance in a cross-channel context. All activity from a performance perspective lent itself to cross-channel de-duplication. We were already looking at rules-based modelling from a performance basis. We focus on one system of truth into understanding where advertisers should spend and attribute correctly.

David Sendroff, Forensiq

David Sendroff:  We have had a great relationship with Impact Radius for many years and have been a great advisor to them along the way. Impact Radius is interesting as a holistic platform; it's a system of record where you can run your whole business on one platform and have integrity behind the data. There are so many bots, and there is so much non-human traffic, and because of the impact they have on metrics and understanding campaign performance, cleansing the data before it enters into the algorithm can provide a source of truth as to what’s actually happening. Forensiq sits at the top of the funnel, evaluating data before you have purchased an impression. This means you can determine the integrity and intent behind the user, page, or impression. What makes the combination powerful is the the deep understanding of the actual performance behind the media buys. It becomes a true, full-funnel platform, where you can manage all media, both online and offline, and track it all the way down the funnel.

Julia Smith: Advertisers desire transparency. The role of the CMO is changing. They are taking higher focus on fraud, attribution, transparency, how it’s all linked, and where their money is being spent. Forensiq has a strong relationship with many advertisers and this makes us a much stronger team.

How has the process of tackling fraud for Impact Radius changed since the acquisition?

Mark Wrighton: We have different processes for individual products versus the full cross-channel piece. There are inherent trust issues in the industry, so we started by making sure we had the highest quality, premium publishers in place before allowing people into our marketplace. Beyond that, we built a system of alerts. You have to have a best-in-class solution, because of how fraud continually evolves. We would often rely on API data from Forensiq for any analysis we’re doing. This was one reason I was excited about joining forces. Big agencies would constantly talk to us about Forensiq being in that space, so to have them on side is incredibly compelling.

Does having Forensiq on-board remove the human element required in fraud detection?

Mark Wrighton, Impact Radius

Mark Wrighton, Impact Radius: There will always be a human element, and you won’t ever completely remove it, but Forensiq does have accelerated capabilities.

David Sendroff: We evaluate massive amounts of data and our data science team build algorithms so that we can create probabilistic risk around different elements. We have got real-time capabilities and we’re in the process of rolling out a deeply integrated solution, which flags and blocks the platform to protect our clients. There is always a human element to remove bad traffic sources, and that’s true within the data science team as well. It's understanding the type of fraud being detected. We can incorporate real-time actions back in our algorithms to minimise the false positive, and even false negative, and this can be adjusted based on varying factors.

Will this deal take Forensiq off the table as a solution for other advertising platforms?

David Sendroff: Forensiq is a strong business and a strong brand and we plan on continuing that, even with an independent offering. Clients can leverage us as a model within the Impact Radius platform, as well as outside of it.

What does Forensiq have in the pipeline, which Impact Radius will help to drive?

Mark Wrighton: As part of the acquisition, we raised USD$30m (£22.7m) to use towards growth. Outside of that, we now have 80% of our resources going into the data engineering and science team, to contribute to platform advancement, so a lot of investment is going into new products and our R&D capabilities.

This move could signal a trend of marketing/advertising platforms owning and operating their own fraud-detection solutions – do you expect that to be the case?

Julia Smith, Forensiq

Mark Wrighton: Perhaps. The power in the platform comes from the suite we have in brand safety and viewability; and, if you look at the landscape, viewability is becoming a commoditised solution, in that everyone is using the same two methods for identifying it and brand safety has become commoditised as well. Ad fraud is the most difficult. I think it’s possible other companies could acquire some types of solutions, but I think building them can be challenging. One of the greater benefits we have is our centralised ad-fraud intelligence. As so many clients are feeding into this database, access to data to create those insights is crucial. But I do believe there will be more consolidation over time.

Julia Smith: There is a need for independence. If you have your own in-house tool, how trustworthy is that data? People say they prefer to have an independent company and the industry often calls upon agencies to have to show due diligence in using an independent verification tool.

Mark Written: As Julia says, independence is important. Impact Radius is not a media owner, so we don’t have the challenge of justifying our position on the credibility of our fraud detection.

David Sendroff: Innovation within fraud will make it difficult for others. If you look at the importance of decision making, it’s based on the insight provided by Forensiq. It’s difficult for other companies to reach that scale. There’s an awful lot of inertia. It would be interesting to watch, but it would be very difficult from a board-level perspective.