Market research fraud, which occurs when fraudsters participate in online surveys to get the monetary incentive, may not get the same attention as identity theft and tax fraud, but its effect on companies can be just as financially damning.
To prevent market researchers from finding fraud in their data, DISQO leverages its first-party relationships with panelists to apply deep identity validation and behavioral checks that isolate and mitigate fraud before it makes its way into surveys.
“Research fraud not only leads to wasted resources scrubbing and cleaning data, but can also ultimately result in product innovation that misses the mark, advertising that fails to reach the right audience or doesn’t resonate, and worst of all, bad brand experiences that diminish hard-won loyalty, which may never be earned back,” said industry expert Bonnie Breslauer.
That’s billions of dollars on the line, thanks to thieves trying to reap the rewards given in exchange for research participation.
“Every industry and category relies on consumer research. No one is immune, and unfortunately, the problem isn’t going away,” Breslauer said, adding that 2020 saw its largest spike in research fraud with some surveys reporting fraud levels greater than 30 percent.
With increasing levels of fraud, plus fraudsters’ evolving technical sophistication, companies that facilitate market research studies, like LA-based DISQO, where Breslauer serves as chief customer officer, have had to level up to protect survey data.
The audience insights platform, which includes a 100 percent first-party pool of survey respondents, has deployed a robust combination of passive and active identity validation methods to mitigate fraud using modern technologies like biometrics, machine learning and AI.
Built In LA connected with Breslauer to learn more.
AN ADVOCATE FOR DATA QUALITY
What’s happening currently with market research fraud?
Breslauer: Market research fraud has been around for decades, but the industry saw a huge spike in 2020. It’s frightening that fraud levels in some market research studies are 30 percent or even higher. Fraudsters are getting more sophisticated and enterprising, and it’s become a cottage industry internationally. Thieves will go wherever there is money to be made online.
How do you identify market research fraud?
Market researchers typically identify fraud through nuances in the data. For example, you can find nonsensical responses to open-ended questions, as well as answers to “trap” questions that can be indicative of fraud. For longitudinal research, inconsistent data trends may also signify an issue.
But in some cases, fraudsters are so “professional” that their data will pass data quality checks.
Thieves will go wherever there is money to be made online.”
How does DISQO mitigate the risk of market fraud, and how has your team’s strategies evolved as fraudsters have?
DISQO has a permission-based, first-party, or direct, relationship with the consumers in our panel. This enables us to utilize robust identity validation methods, which are at the forefront of our fraud detection. We use a combination of passive and active techniques to understand who our panelists are and monitor their activity over time.
Given the current spike in fraud, we’ve increased our defenses by adding more innovative techniques to build on our toolset. For example, our data science team enhanced our machine learning capabilities to help us identify potential fraudulent panelists at any stage of their life cycle. We’re also excited to launch a new fintech identity validation technique and to introduce it to the market research industry. We’re leveraging biometric facial recognition for identity validation.
How do your fraud prevention tactics affect the user experience?
One of the biggest challenges we have is to create an engaging and rewarding experience for panelists while at the same time having strict rules to deter fraud.
We don’t want to be intrusive. We don’t want to treat the good people in our community with suspicion. We strive to give our valued panelists a positive and frictionless experience. That’s why we use so many passive techniques, conducted behind the scenes so that our users can join our panel and take surveys without having to go through an arduous process.
We also do a lot of testing to understand the impact on our panelists’ experience, particularly as we roll out new techniques. For example, we did extensive testing with our panelists before launching the use of biometric facial recognition for identity validation. We found that thanks to consumer technology, particularly smartphones, consumers have become increasingly accustomed to and comfortable with verifying their identity with facial recognition.
What future trends surrounding fraud is your team looking into?
Mitigating fraud is a continuous endeavor. We’re never done, as thieves will continuously show up with new techniques. This and the sheer volume of fraud globally means we have to constantly evolve our own processes and also look to innovative technology, like biometrics, machine learning and AI. And, we will continue to monitor trends and invest in the latest greatest methods and technologies to keep a step ahead. That’s a tall order, but DISQO is unwavering in our commitment to provide accurate data.