Meaning
Financial modeling establishes the economic loss incurred when non-human or deceptive traffic inflates advertising invoices. An ad fraud damages calculation compares the raw billing records against audited traffic logs to isolate the cost of impressions generated by botnets or automated scripts. This analysis excludes legitimate user interactions and focuses entirely on the monetary delta between the billed amount and the verified media value.
Assessment Method
Reconciliation relies on the difference between the listed cost per thousand impressions and the true yield. Advertisers calculate the discrepancy by multiplying the identified invalid volume by the contracted unit rate.
Financial Recovery
Settlement actions require the media buyer to present structured proof of the billing discrepancy to the agency or publisher. When agreements include protective billing clauses, the buyer uses these calculations to claim credits or direct refunds for the corrupted inventory. Refund thresholds often dictate the minimum trigger for formal claims.
Legal Standard
Proof of loss must satisfy the civil standard of probability by showing a direct link between the billing records and the server log anomalies. Arbitrators expect a systematic extraction process rather than broad estimates of simulated traffic. Clear evidence of artificial traffic holds up under contract disputes.
