Comma Error Causes Overpriced Advertising Campaign - a Real Damage Event
Risks of Online Advertising
Online advertising is a science in itself. Depending on the social network, advertisers not only have to deal with various regulations. They should also plan the budget carefully and always keep an eye on the ongoing process. Reason enough for many companies to outsource these measures to experts. A media agency insured by exali was also commissioned by its client - an online shop that sells clothing and accessories - with campaigns on Meta's advertising network (Facebook and Instagram). The adverts were intended to redirect users to Amazon. If they made a purchase there, the shop received a commission from the online giant.
The following damage events illustrate the pitfalls of online advertising very impressively: Google Ads Error: 15,000 Euros in Damages for a Misplaced Check Mark and Real Exali Damage Event: Comma Error Causes the Cost Of Facebook Advertising To Explode.
Wrong Click Blows Up the Advertising Budget
As part of the collaboration, the parties involved agreed on a maximum click price. This specifies the maximum amount that advertisers are willing to spend for a click on their advert. In this case, the maximum click price was 15 cents. However, the tasks of an agency also include the continuous monitoring and optimisation of an advertising campaign. In the course of this, an employee of the agency made a bid change: He was supposed to raise the click price from the original 11 cents to 13 cents.
In doing so, he made a careless mistake that was to have fatal consequences: Instead of the agreed 13 cents, the agency employee increased the click price to 13 euros. When the mistake was discovered four days later, the shock was great. On the selected days, Meta's advertising network exceeded the agreed budget limit of 50,000 euros per campaign by 125 per cent. This resulted in a difference of over 100,000 euros compared to the originally agreed click price of 15 cents, which the client demanded back from the agency.
Your Protection In the Media Sector
Especially in the media sector, the requirements are varied and high. This damage event is impressive proof of how quickly a mistake can be made in this context, leading to expensive consequences.
In such cases, Professional Indemnity Insurance through exali is at your side. Whether it's unlawfully used images, a breach of data protection or property damage because something is broken during a video shoot: the risks in the media sector are manifold. If third parties make claims against you due to professional negligence, you do not have to deal with this dispute on your own. Instead, the insurer checks the claims made against you and settles the claim if necessary. If the claims prove to be unfounded, the insurer will defend them on your behalf.
To tailor your coverage even more closely to your business in the advertising and media sector, exali also provides you with an add-on that you can book: With the Additional Add-on for First-Party Cyber and Data Risks Insurance (FPC), you can customise your cover precisely to your risk situation.
Do you have questions about your specific requirements? Our customer service team will be happy to help you Monday to Friday from 9.00 am to 6.00 pm (CET) on + (49) 0 821 80 99 46-0. Alternatively, simply use our contact form.
100,000 Euros In Damages - Who Is Responsible For the Advertising Fail?
Faced with such a horrendous claim for compensation, the media agency sought support from its Professional Indemnity Insurance through exali. It contacted the experts at exali, who examined the case in detail and forwarded it to the responsible insurer after carefully analysing it. As the claims department already had experience from a similar damage event in the previous year, it was able to quickly categorise and understand the financial consequences of the agency's professional error and thus settle the claimed damage amount of 100,000 euros in an uncomplicated manner.
This was the case even though it was not the owner of the agency himself but his employee who had made a mistake. However, this does not play a role in Professional Indemnity Insurance through exali. This is because, in principle, not only the mistakes of the agency owner are insured, but also those of the employees (regardless of whether they are salaried employees, working students or interns). This means that you and your team can move your agency business forward and are covered against expensive consequences in the event of a mishap.