The Rise of Mobile Advertising Fraud

The Rise of Mobile Advertising Fraud

With more than 2 billion smartphone users globally, spending on mobile advertising has increased dramatically as marketers look to capitalise on the growing mobile market. But as advertising revenue is diverted away from desktops, the battle against fraudsters has gone mobile too.

According to research by eMarketer, worldwide mobile advertising spend will surpass the $100 billion mark for the first time by the end of 2016—an increase of 430% since 2013. As advertisers continue to invest heavily in the mobile arena, the pressure is on anti-fraud vendors to do more to counteract the correlating increase in fraudulent activity.

One of the biggest issues with mobile advertising fraud is its diversity and its ability to evolve, with fraudsters using a range of techniques to harvest revenue, including device hijacking, ad-stacking, click-spoofing, and attribution fraud.

This increase in non-human traffic and the use of bots is predicted to result in $7.2 billion worth of losses globally to the mobile advertising industry by the end of 2016—making mobile ad fraud a priority for both advertisers and publishers.

What can be done to prevent mobile ad fraud?

Whilst eradicating all types of mobile fraud completely will be a difficult task—as fraudsters and criminal organisations try to stay ahead of the game—organisations can take steps to further improve its prevention and detection.

According to research by Apptentive, the key lies in pattern recognition and being able to detect mobile advertising fraud before an impression gets served. By understanding the patterns of human behaviour, organisations are able to more effectively weed out and recognise non-human or fraudulent traffic—saving them both time and money in the long term.

Second, by having publishers and advertisers work together to fight fraud you would be able to create a database of blacklisted IP addresses or rogue publishers. Companies can then monitor for post-install app activity to get a more detailed understanding of whether or not fraud is taking place – if it is, these sources can then be added to the database.

In an interview with AdWeek, Ron Amram, VP of Media at Heineken, acknowledges the importance that partnerships need to play in eradicating mobile ad fraud: “In order to really take this to the next level and allow us to reduce fraud as an issue, we need to work with vendors, isolate the issues, remove it from the ecosystem and work both sides of the fence. But all of this starts with transparency—the more you can work with vendors to remove fraud, the better chance we have at cleaning the ecosystem at the root.”

Whilst mobile advertising fraud is proving a widespread threat to the mobile industry and its revenue streams, there is lots the mobile industry and anti-fraud vendors are doing to detect and prevent it. In the meantime, the battle between fraudsters and advertisers goes on.

The Rise of Mobile Advertising Fraud