The Multibillion-Dollar Industry Costing Brands Revenue and Hijacking Consumers

It comes as no surprise that in these challenging times, brands are pulling out all the stops to engage consumers and increase conversions, ranking customer experience as their top priority for driving business growth. In their effort to ensure that online shoppers complete their purchase process — and keep coming back — companies have invested in a variety of helpful tools, including artificial intelligence-driven personalization services, remarketing, checkout optimization, loyalty programs, and more.

Despite all these investments, brands continue to grapple with one unique problem that’s diverting consumers from their sites and depriving them of substantial revenue. Exposed by Google in 2016, the phenomenon of "customer journey hijacking" impacts an estimated 20 percent of e-commerce visitors.

Focused on capturing the highest converting traffic and selling it to the highest bidder, customer journey hijacking affects approximately $9 billion in annual e-commerce revenue — some 1.5 percent of all e-commerce sales, according to our findings at Namogoo.

The problem isn’t new, yet is still costing brands millions in annual revenue. So why does customer journey hijacking continue to beleaguer retailers? Here’s a closer look at how it works.

Understanding Customer Journey Hijacking

At the core of the problem are ads injected directly into consumers’ browsers, without their consent, with the aim of redirecting shoppers to competitor sites through “too-good-to-resist” offers. Hijackers monetize web traffic through revenue collected via ad impressions and clicks sold to ad networks. They typically shroud their tactics by positioning themselves as traffic monetization solutions.

Traffic hijackers employ a range of ad injection methods. Most commonly, consumers will install or download free web services — e.g., browser extensions, program updates, PDF converters, free antivirus programs, etc. — that come bundled with adware. Revenues paid by traffic hijackers enable such services to be kept free in the first place. Alternatively, hijackers will inject ads into a consumer browser or device after that shopper connects to public Wi-Fi services.

Among the more well-documented examples of traffic hijackers using extensions to insert ad injections was Buzzfeed’s investigation into advertise.com, which created popular extensions like MyPDF.com, which promised to convert web pages into PDFs. This is all perfectly legal: ads are injected into real browsers, used by real consumers on legitimate (though unaware) websites. It’s not the tactic’s legitimacy that’s at issue, it’s the damage to brand revenue.

Why it’s Costing Brands Millions

Customer journey hijacking persists for two simple reasons: First, it’s extremely difficult for brands to detect, as the problem occurs entirely on the consumer browser side. Additionally, some advertisers are happy to look the other way given the performance of injected ads.

Say what you will about their methods, but there’s no denying that traffic hijackers are savvy. The browser extensions and free web services they utilize are blind spots for online brands. From the consumer perspective, the injected ads they’re exposed to blend in stylistically, making the ads all the more effective at siphoning traffic to competitor sites — particularly when the shopper is being offered the same product at a cheaper price. And because traffic hijackers collect data on user behavior and shopping habits and serve ads accordingly, the ads consumers see don’t strike them as suspicious or irrelevant.

Where do advertisers fit in? Like the brands that fall victim to customer journey hijacking, they’re usually in the dark. Advertisers typically go through three or four mediators, and a single injected ad is often funneled through several ad networks, exchanges or mediators, making it difficult for advertisers to discover that they end up buying traffic from a traffic hijacker.

Ad impressions that cannot be sold directly to advertisers are sold through ad networks, allowing hijackers to sell this traffic to advertisers without the advertisers knowing the true traffic source. As long as the ads are performing well, there’s no real incentive for advertisers to investigate the source.

For some, these offerings are undoubtedly more compelling because they offer placements on sites that otherwise refuse advertising. For example, sites like Wikipedia or brand sites and domains in the retail industry.

The hijackers are not only targeting more and more consumers, but the right consumers — i.e., the ones spending the most money. Active e-commerce shoppers have a higher propensity to purchase online, making them the most valuable target for hijackers, as ad impression cost for this audience is more expensive.

As digital commerce accounts for a growing share of sales during COVID-19 and will likely continue to do so into the future, brands need to be aware of the issues plaguing their sites and diverting their customers. Otherwise, they'll be unable to reap the benefits of the customer experience in which they’ve invested so much in terms of both revenue and brand loyalty. Advertisers, meanwhile, would be well advised to up their due diligence investigating the source of ad impressions.

Customer journey hijacking may be stubbornly persistent, but that’s largely because so many enterprises are unaware of it. Preventing this problem can be as just as important to the customer journey — and retailers’ bottom lines — as any other aspect of the e-commerce experience.

Chemi Katz is the CEO and co-founder of Namogoo, a customer journey hijacking prevention platform that wins back stolen online revenue by blocking unauthorized ads that are diverting your customers.