Ad fraud in mobile: How to safeguard your marketing budget

Where there is money, there is fraud. Ad fraud is not a new phenomenon, but as global mobile ad spend increases, it becomes more tempting for some individuals or organizations to commit fraudulent activities because the potential rewards grow in accordance.

Today, ad fraud is a major challenge faced by advertisers, publishers, and adtech companies alike. In fact, according to Business of Apps, in the United States, 15% of the total ad spend, or $62 million out of $407 million, was wasted due to ad fraud in 2022. To make matters worse, ad fraud entails not only immediate financial damage but also decreased ROI and loss of trust.

It is self-evident that ad fraud is a must-know concept in the mobile marketing industry. In this blog post, we’ll explore the definition of ad fraud in mobile marketing, types of ad fraud, and the prevention and detection methods. Let’s dive in!

What is ad fraud?

Ad fraud in mobile marketing refers to the practice of generating fake impressions, clicks, or conversions on mobile ads for financial gain. Through various methods, scammers deceive legitimate advertisers across multiple publishers and make it appear as if their ads, no matter the format, are being viewed, clicked, or engaged with by real users, when in fact they are not.

There are both direct and indirect impacts of ad fraud on an app business’s profitability. On the direct side, ad fraud causes marketers to spend their ad budget on clicks and impressions without real value, or on traffic generated by bots, resulting in a significant waste of money. This also means that their overall return turns out to be lower than expected. On the indirect side, ad fraud does serious harm to the advertiser’s brand reputation and decreases the effectiveness of future ad campaigns. What is more, these are altogether detrimental to the health of the mobile ecosystem.

Common types of ad fraud

While there are many different forms of ad fraud in the mobile marketing industry, understanding at least some of the most common ones helps with minimizing the risk.

Click spamming

Also referred to as click flooding, click spamming is a type of click fraud that involves the use of bots to “click away like crazy.” By generating fake clicks on mobile ads, this fraudulent activity wrongly takes credit for the last click before conversion, leading marketers to reallocate more budget to ad networks that are not creating any actual value. As a consequence, the fraudster generates revenue, drives up ad costs for a particular keyword, or exhausts competitors’ ad budgets.

Click injection

A sophisticated form of click spamming, click injection takes place when the broadcast feature of Android is abused to detect an app install. Upon receiving the signal, the fraudster “injects” a click before the installation is complete and steals credit for an install generated by another ad network. Like click spamming, click injection results in an unnecessary payout to the fraudster and skewed mobile analytics data, affecting the advertiser’s targeting strategy and budget distribution.

SDK spoofing

Another threat that steals marketing budgets is SDK spoofing. Malware hidden on apps create fake installs using data of real devices, consuming an advertiser's budget without providing any actual value and even tricking the advertiser into paying for thousands of installs that did not actually occur. SDK spoofing is hard to detect because the fraudsters use legitimate SDKs and mimic legitimate user behavior.

Pixel stuffing

To commit pixel stuffing, scammers display dozens of ads in a single 1x1 pixel frame, making all of them invisible to the human eye but still getting credit for serving those impressions. Even if the ads are delivered, the ad campaigns do not generate any results for advertisers since the users never get to see them.

Ad stacking

Also a type of impression fraud, ad stacking is a technique where multiple ads are layered on top of each other, so that only the top ad is visible. This can artificially inflate impressions and click-through rates for the top ad, while the other ads in the stack are effectively hidden.

Device ID reset

At times, fraudsters reset the unique identifier of a mobile device between installs to make it appear as a new device. This way, they can bypass fraud detection systems and use them to make unauthorized clicks, installs, or purchases. These cyclical actions, or device ID reset marathons, drive seemingly legitimate user interaction that does not have actual value to the app’s growth or the advertiser.

Duplicate IP

Duplicate IP in ad fraud refers to a tactic used to generate a large number of app installs from the same IP address within a short period of time. Using automated software or bots, scammers create a false representation of an app’s popularity that can mislead mobile users or advertisers.

How to protect yourself from ad fraud

Detecting and preventing ad fraud requires a multi-layered approach. In essence, you start off by determining a baseline of “normal” user behavior that allows you to identify anything abnormal. Then, based on the absolute minimum, you can monitor your data and blacklist suspicious domains and IPs while whitelisting trusted publishers and ad networks. You can also use a bot management system and anti-malvertising software.

Yet, to effectively boost your protection efforts and safeguard your marketing budget, it is advised to use advanced tools that are specialized in fighting ad fraud.

No worries at all, we’ve got you covered!

Airbridge is a mobile marketing partner that is designed to provide marketers with the most accurate view of their ad performance.

As part of the effort, Airbridge helps marketers closely monitor traffic sources and fraudulent activities in real time. It identifies any unusual patterns or discrepancies and tracks down suspicious anomalies such as click injection and click spamming. Airbridge also allows marketers to personalize fraud validation rules to suit their business needs. In other words, it’s a complete package.

As the mobile advertising industry continues to grow, it is crucial for marketers to remain vigilant and stay up-to-date on the latest developments in ad fraud prevention and detection. By working with Airbridge, you’ll be able to protect your ad budget and maximize your marketing potential.

We’ve got your back. Contact us today to stay one step ahead of fraudsters and continue to drive success.