Advertising fraud continues to be a major issue for the industry with an estimated $16.4 billion being lost in 2017. A recent study by mobile ad tech company AppLift identified India and Indonesia to be facing some of the highest rates in advertising fraud at 31.29% and 21.23% respectively.
We spoke to Managing Director of AppLift, Stefan Benndorf, about the upcoming challenges mobile marketers are facing and how advertising fraud could potentially be solved.
- Your latest findings posted in “Combating Mobile Advertising Fraud: The Next Battle Grounds,” highlight wide regional differences in advertising fraud. What’s contributing to these differences?
We studied impression fraud on RTB for various countries, as well as, within the app categories. We found that ad fraud can vary due to a multitude of factors with just a few being ad exchanges, supply partners and payouts. Maturity of the app market is another contributing factor. For example, we have seen relatively higher impression fraud in India and Indonesia compared to Western countries, as these territories are still emerging in the mobile ad space, making them more susceptible to ad fraud.
- Ad fraud poses a real threat to the advertising ecosystem, does it also directly impact on consumers opting for ad blockers?
We do not believe that mobile ad blockers are solving the issue of ad fraud. The adoption of ad blocking is still very low, particularly that of in-app. If the adoption of mobile ad blocking continues to rise, consequences will surface and the size of the addressable mobile ad market could turn stagnate or even shrink and the commercial impact of ad fraud may become much smaller. That being said, this does not solve the problem because as long as there is money to be made with mobile ads, there will also be an incentive for fraudulent activity.
- What are some of the main challenges arising over the coming four years?
Ad fraud and its prevention will remain a high priority topic for advertisers and marketers. Increasing sophistication of fraudsters and new fraud types will contribute to this. With a maturing industry, it is important that advertisers, publishers and marketers strongly collaborate to fight advertising fraud. The main challenges that need to be addressed are:
- Transparency and clarity on the attribution funnel
- Standards the industry abides by
- Data exchange between players
- Given the high levels of sophistication, will fraud technology just become savvier or are we winning the war on ad fraud?
As an industry, we have made significant progress to identify low quality traffic coming from bots, click farms and incent. This has made it difficult for fraudsters to run campaigns at scale with these methods. However, attribution fraud (click spamming, ad stacking and click injection) is still a reason for worry because of its sophisticated nature. It is harder for advertisers to trace fraud if they don’t have access to mature detection technologies and processes. The combined efforts of humans plus technology will be what wins the war against ad fraud.
- Combating ad fraud requires collaboration across the mobile industry from ad agencies to ad tech developers. Who should focus on what?
Ad fraud breaches the trust between networks, publishers and advertisers. This can be problematic, considering each of these stakeholders form an important link in the chain. Individual players need to develop their own initiatives based on their skill sets, to detect patterns and study heuristics, in an effort to share this knowledge and combat ad fraud. Before beginning campaigns, advertisers must ask their partners about their approach to fraud to see if they have chosen methods that have robust prevention measures in place. To ensure safe measures, insist on working with media sources that have the highest quality practices and who take a proactive stand against fraud.
For ad publishers and DSPs, monitoring traffic and campaign-related KPIs for suspicious patterns is critical. For example, if there is an unusually high app-install rate with the time between click and app install uniform for every user from the same traffic source, or if the time between click and install is inexplicably short, these are all red flags. Finally, attribution partners have an important role: to be unbiased and independent with an insist on transparency throughout the entire chain.
Find out more about AppLift’s latest research here.