What is mobile ad fraud? Types, Detection, and Prevention

Have you noticed that as more people use mobile devices, mobile advertising has taken on more significance? In 2019, the amount spent on mobile ads worldwide was estimated to be 234 billion dollars. This amount is expected to increase to 495 billion dollars by 2024.

However, this growth also raises the possibility of mobile ad fraud, which can result in phony impressions, clicks, and installs that can be expensive and detrimental to both advertisers and companies. Let’s join Adsnextgen to learn about false advertisements on mobile devices, the most common forms of mobile fraud today, and steps to prevent and limit them.

What is mobile ad fraud?

Mobile ad fraud is a process of fraudulent activity performed to artificially inflate key mobile advertising metrics, such as views, clicks, or installs. Ad-generated bookings. This type of fraud can be committed by bots, automated software, or even individuals who are paid to manipulate mobile ad engagement numbers. When reported engagement is not authentic, marketers pay for fraudulent clicks and installs that do not generate revenue.

To prevent fraudsters from sabotaging marketing efforts and draining advertising budgets, advertisers and marketers must monitor their advertising campaigns for signs of fraud, including affiliate marketing fraud. Advertisers can stop collaborating and paying partners who use mobile drudgery to earn commissions. Refer to the article to know the rules when participating in the next link surfing session. Refer to the article “FTC affiliate compliance” to learn about the rules when participating in your next link-surfing spree.

mobile ad fraud
What is mobile ad fraud?

7+ Common Types of Mobile Ad Fraud

To protect your app from mobile ad fraud, you must first understand how the fraud is conducted. The most frequent types of fake mobile ads are briefly summarized here:

Fake clicks

Click fraud is a deceptive practice in which fraudsters generate fake clicks on mobile ads to make it seem like users are engaging with them. There are different ways to carry out click fraud, including click spamming, where individuals or bots repeatedly click on ads to boost ad metrics and increase ad costs. Another way to do it is by using malware that automatically clicks on ads without the user’s consent or knowledge.

mobile ad fraud
Fake clicks

SDK Deception aims to Fake App Installs

Another mobile ad fraud is SDK spoofing, which is the practice of creating fake install records for apps even though none are being installed. Since most scammers use real devices to create download events that look legitimate, spotting an SDK spoofing incident can be difficult.

Since it can quickly emulate tens of thousands of bogus installs, SDK spoofing is especially dangerous once fraudsters have embedded it into the app code. Very quickly, all of your advertising money will be spent on users that don’t exist.

Advertising stacking

Ad stacking is a tactic used to trick a genuine user into clicking on the incorrect ad by stacking multiple ads on top of one another within a single ad placement. Fraudsters manipulate reported numbers of impressions and interactions by stacking ads. The idea is to create the impression that someone has seen the intended advertisement when in reality, they haven’t. Additional fake mobile ads include employing bots to create phony impressions or hidden or invisible advertisements.

fake mobile ads
Fake mobile ads include employing bots to create phony impressions or hidden or invisible advertisements.

Fake installs

A fraudster performs a fake install by using device emulators, device farms, and bots to claim advertising revenue for an install that never occurred. The fraudster steals money from advertisers, networks, and publishers. Install fraud can also be accomplished through the use of install farms or incentivized traffic, which are groups of people who are paid to repeatedly download and install applications.

Fake location of traffic

The traffic location is one of the factors that influences the cost of the advertisement. Traffic from particular locations may be valued higher than traffic from other locations, depending on the industry and the product/service being advertised. Similar to this, traffic from particular locations might not matter at all for some goods or services.

For example, if you want to advertise a product in the United States, you may be willing to pay more to have your ads shown to American audiences. However, a fraudster can deceive by using geo masking to display your ads to traffic from Pakistan while making it appear as if the ad is being shown to US audiences. As a result, you may pay more per click/impression/app install while gaining access to a lower-quality, less relevant audience.

mobile ads false advertising
Mobile ads false advertising

Click farm by repeatedly clicking on mobile ads

Click farms, also known as device farms or phone farms, are physical locations where real mobile devices are used to commit mobile click fraud. They drain display-based marketing campaigns by repeatedly clicking on mobile ads.

This type of mobile fraud is particularly challenging for app developers and marketers because it is harder to track. When someone sees in-app activity, it is easy to assume that these are real users. Some of them may even seem engaged enough to reach certain attribution thresholds that app developers and marketers are focused on.

Click farms usually try to tap into campaigns in regions with lucrative payouts by changing their IP addresses using VPN and Proxy software. They often attempt to hide their activity behind Limit Ad Tracking and DeviceID Reset Fraud.

Bots- an autonomous program

A bot is an autonomous program designed to perform predetermined tasks over the internet. While bots’ tasks are typically simple, these software programs have evolved to handle increasingly complex situations, both good and bad. Mobile fraud bots can run on real mobile devices, but they frequently run on servers, attempting to simulate specific tasks such as ad clicks, installs, and in-app engagement while impersonating legitimate users.

IP blacklisting is frequently used to stop server-based bots, but scammers have figured out how to better conceal their activities behind recently added IP addresses that aren’t on the blacklist, necessitating regular updates to blacklists and sophisticated techniques for detecting fraudulent IPs. To evade fraud protection solutions, these programs update their metadata frequently, watch and learn from user behavior patterns, and apply these insights to their operations.

mobile ad fraud detection
A bot is an autonomous program designed to perform predetermined tasks over the internet.

Mobile ad fraud detection and prevention

To prevent fake mobile ads as soon as they occur, every developer of mobile websites and apps needs to be able to recognize and identify them. Even though not every indication suggests fraud, this will encourage you to examine your campaigns more closely. We will list the mobile ad fraud detection and prevention below:

5 signs mobile ad fraud detection indicators

Some of the most noticeable indicators of fake mobile ads are:

Unusually high traffic volumes

When your campaign has no significant changes, a sudden increase in traffic/installs may be considered unusual. If you haven’t changed your targeting settings or ad creatives and are still seeing a significant increase in incoming traffic, you may have been a victim of fake mobile ads.

Incoming traffic coming from unexpected places

If you notice a large number of visitors coming from a single IP address or if your traffic is coming from a very specific region. And you’re seeing a lot of user sessions but only a few unique visitors. This is a mobile ad fraud detection that you need aware of.

Low conversion rates

If you have a large number of users on your platform but conversion rates are extremely low, particularly at or below 1%, you should be concerned. This is especially concerning if you notice that the number of clicks and installs is consistent or increasing while the number of orders, in-app purchases, or paid subscriptions is declining. If you notice an unusually high number of new downloads or clicks, but no real revenue is generated, this could be an indication of SDK spoofing.

Spending advertising funds quickly

Click fraud, such as click spamming, may be the cause of the fast depletion of ad budget while you haven’t adjusted your targeting settings.

mobile ad fraud detection
Mobile ad fraud detection

Mobile ad fraud prevention

Let’s look at some of the most effective strategies for mobile ad fraud prevention.

  • 1. Advertising fraud detection tools

The use of ad fraud detection tools is a critical step in mobile ad fraud prevention. These tools use advanced algorithms to analyze mobile ad traffic and detect potential fraud. DoubleVerify, MOAT, and Pixalate are some of the most popular ad fraud detection tools available today. Ad fraud detection tools are useful because they can identify fraud before it becomes a serious problem.

  • 2. Verification processes

Another critical measure for preventing mobile ads’ false advertising is to implement verification processes in mobile advertising. Verification processes include steps like verifying ad impressions and installs, as well as ensuring that ads are displayed to real users rather than bots. Industry leaders, such as Google and Facebook, have implemented verification processes to combat mobile ad fraud. Verification processes are beneficial because they ensure that advertisers only pay over legitimate traffic and do not waste money on fraudulent traffic.

  • 3. Transparency is crucial in preventing mobile ad fraud

When purchasing mobile ads, it is important to understand where the ads will appear and who will see them. Advertisers should demand transparency from their partners and ensure that everyone involved in ad buying operates ethically and transparently. It is best to avoid purchasing ads from unknown sources and stick with reputable partners. Advertisers benefit from transparency in ad buying because it helps to prevent fraud by ensuring that their ads are displayed in appropriate contexts.

Advertisers can apply these common measures to prevent fake mobile ads. Among these best are keeping an eye out for practices:

  1. Unusual behavior.
  2. Checking the caliber of traffic.
  3. Making use of anti-fraud technologies.

Advertisers can drastically lower the risk of mobile ads false advertising by putting these best practices into practice.

FAQs

How do I report fraud online?

The federal government’s website, ReportFraud.ftc.gov, or FTC Affiliate Compliance allows you to report fraud, scams, and bad business practices.

What safeguards can companies take against mobile ad fraud?

As we mentioned before, businesses can protect themselves from ad fraud by implementing best practices, using verification ad fraud detection tools, utilizing processes, and practicing transparency in ad buying. Additionally, they can work with reputable ad networks and partners and stay informed about the latest trends in ad fraud. By taking these steps, businesses can safeguard their advertising investments and ensure that their ads are reaching real audiences.

Mobile ad fraud poses a serious threat to app developers, mobile site developers, and marketers. It drains millions of dollars in ad spend annually, and many apps are unable to bear the loss that fraud can cause. By understanding what ad fraud is, how it occurs, and how to prevent it, we can make sure that our budget is not wasted on fraudulent activities. Adsnextgen hopes that this guide will raise more awareness about mobile ad fraud and provide advertisers with the necessary information to safeguard themselves and their campaigns.

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