Performance MarketingLeadership Summit

November 3rd 2009Peter Bordes, CEO, MediaTrust

State of the Industry#1 problem in the industry is fraud. It hurts industry growth because:

• It cripples existing business and hurts future growth

• Brand advertisers don’t trust the channel, so big budgets are staying on sidelines

• Existing advertisers hurt by chargebacks, losses of merchant accounts, lead fraud

• Performance marketing segment is losing advertisers to other trusted direct response channels

• Publishers have a difficult time "nding campaigns with longevity

The Industry is Growing, But...

2005 2006 2007 2008 2009 2010 2011 2012

US Online Affiliate Spending - 2005-2012 (Billions)

Category TitleOnline Affiliate Marketing Spending Source: Jupiter Research 2008

$1.3$1.6 $1.8

$2.1 $2.3$2.6

$2.9$3.3

The reputation of the industry is being damaged ... the fraudissue needs to beaddressed immediately!

Why is Fraud Prevalent?• Our Industry has a history of “siloed”, fragmented networks.

• Data is “black-boxed” and there is a lack of transparency

• Our industry is reactive vs being proactive/in front of issues

• Fraud rings can move around due tolack of industry communication andsharing of data

• Few industry associations exist toestablish standards, best practicesand self-regulation

• Issue is swept under the rug because people arestill making money and afraid to talk about it

• It’s up to the networks and platforms to solve this problem

Fraud Example*• Fraud rings are openly buying and selling approved CPA

network accounts so that others can login with them to defraud advertisers and end-users

* unfortunately, this is one of MANY types of fraud we see every week

So what is MediaTrust doing?• Publisher on-boarding process re-architected to be much

more rigorous

• Publisher cross-referencing between partner networks

• Publisher referencing from trusted publishers

• Site and landing page review to examine for nefarious practices

• Development of "trusted criteria" for existing network of publishers

• Removal of 1000’s of untrusted and un-veri"ed publishers

• Real-time analysis of live campaigns via proprietary fraud detection software

MediaTrust Process Details

MediaTrust Process Details

Results Come Fast• We have already earned a reputation as one of the most difficult

platforms to get into• Fewer “bad publishers” are applying and our publisher conversion rates

have increased with our more demanding sign up process

What should the Industry do?• Support our industry

association -the PMA- to set standards/guidelines and create research

• Industry leaders need to band together and develop self-regulation guidelines

• Create transparency via shared data among providers to prevent fraud rings, nefarious affiliates, etc

• Generate industry publisher and advertiser whitelists to keep out dodgy players

• Develop education and accreditation programs