Vero Wiedemann29 November

What is advertising fraud and how to prevent it?

The world of digital advertising is a dynamic and ever-evolving environment that offers a rich landscape for companies to connect with their audiences. However, in the midst of this vast panorama, a silent but damaging threat emerges: the
advertising fraud also known by its English name ad fraud.

For those who are anxious, I’ll preface this by saying that if you’re buying advertising and paying by results rather than CPM, you probably have a high exposure to fraud, and you may not even know it. All that glitters is not gold, and advertising fraud is much closer than you think. And if your marketing strategy is within the mobile world, pufff, not to mention.

From Boomit, with an audit that takes less than 30 days, we have detected in more than 10 companies from different sectors, that on average, more than 22% of the traffic they were paying, was fraud.

In this article, we will explore in detail what ad fraud is, why it represents a serious challenge and how to prevent it. To fully understand this issue, we will break down the types that exist, especially in the mobile environment, and offer concrete solutions to protect your advertising investments.

What is advertising fraud?

Unfortunately, ad fraud is an issue that has been on the rise in the digital marketing world. In essence, it is any attempt to deceive or defraud digital advertising networks for the purpose of dishonestly obtaining financial gain.

Often, fraudsters resort to automation through bots to carry out this fraud, although there are more sophisticated methods that involve human interactions. Ad fraud represents a significant threat to brand advertisers, marketing agencies for apps and ad networks, as it erodes confidence in the metrics and blurs the calculation of the return on advertising advertising spend.

This problem has become especially acute in today’s world, where digital advertising plays a key role in the marketing strategy of many companies. Advertisers rely on these platforms to reach their target audience effectively, and ad fraud undermines the effectiveness of these ad campaigns by presenting inflated data and misleading results.

Why is advertising fraud serious?

Ad fraud is not only an economic hindrance, but also jeopardizes credibility and trust in the digital advertising market. Let’s see why it is so serious:

1. Loss of economic resources: Advertisers invest large sums of money in digital advertising. Advertising fraud diverts part of these resources to fraudulent activities, which represents a significant financial loss for companies.
2. Metric distortion: Fraud artificially inflates advertising metrics, making it difficult for advertisers to make informed decisions. This can lead to erroneous decisions and inefficient allocation of advertising resources.
3. Less confidence in digital advertising: When advertisers cannot trust advertising metrics and results, confidence in the effectiveness of digital advertising in general diminishes. This could lead to a decrease in advertising spend and the adoption of non-digital advertising strategies.
4. Audience impact: Ad fraud often involves the distribution of ads on low-quality or even malicious websites or applications. This can have a negative impact on user experience and brand perception.

The seriousness of ad fraud lies in its ability to undermine trust, distort data and waste resources. The fight against ad fraud has become a priority for the digital marketing industry.

Types of advertising fraud

There are several types of ad fraud and, of course, the mobile environment is not exempt from this problem. Here, we will break down some of the most frequently occurring fraudulent practices:

Installation Fraud (Install Fraud): This tactic involves faking application installations, often used to alter the results of campaigns measured on a Cost Per Install (CPI) basis. Click farms are often created, engaging in mass installation of applications and generating fake profiles on them.

Fraudulent in-app event:
Known as in-app event fraud, this scam attacks Cost Per Action (CPA) by attributing cost actions to fraudulent sources instead of the legitimate app.

Hijacking: It is based on server domain redirection, which leads users to unwanted or malicious websites. This is often used to position web pages in places that users do not usually visit.

Click injection:
This tactic increases the number of clicks in advertising environments, often on seemingly safe programs such as wallpapers or image filters.

Retargeting:
Bots simulate the behavior of previously interested users to increase Cost Per Thousand Impressions (CPM).

Click hijacking: Click hijacking is a tactic where an attacker redirects a legitimate click a user makes on an ad to a different ad. In other words, the user’s click is “stolen”.

How to prevent advertising fraud?

Fortunately, there are steps that advertisers and agencies can take to prevent ad fraud:

Pre-investment research: Before investing, it is essential to research ad networks and platforms to identify potential fraud risks.

• Analyze what your inventory will be, i.e. where your ads will be.
• Check if the traffic you buy is incentivized or not. This is not to say that it is wrong to buy incentivized traffic, but if you do, you must measure it accordingly, and pay for it at an appropriate price.
• Avoid buying from DSP’s, agencies or advertising companies that offer you risk-free advertising, CPA, fixed payment per lead, per install, per click, etc. Risk-free advertising is like “be your own boss” courses, but in the advertising world, run away from them.

Detection of inflated data: Be alert to the possibility of inflated data or extremely positive results that are unrealistic. If it is too good, then be suspicious.

Industry standards: Employ standards and benchmarking with other industry players to increase transparency in digital advertising and make it more difficult for fraudsters to falsify data.

Detection and prevention software: Use specialized tools to detect and prevent fake traffic, such as clicks and conversions. There are several tools on the market for this, from complex AdServers to tools like MMP’s will give you an excellent help to detect this.

If you need the support of an expert team in fraud detection and maximization of results in your advertising strategy, write to us, and we will gladly analyze your case.

Conclusions

Ad fraud is a real threat in the digital advertising world, but it is not insurmountable. With a solid understanding of their types and effective prevention strategies, companies can protect their advertising investments and maintain the integrity of their campaigns. In an ever-evolving environment, detecting and preventing ad fraud is critical to ensuring that every advertising investment is a smart investment.

Technology solutions offer a way to defend against ad fraud and ensure that every click, install or conversion reflects reality. The world of app marketing still has a lot to explore, and every step towards fraud prevention brings us closer to a more reliable and successful digital advertising landscape.