The Role of Ad Fraud in Digital Marketing

cpa marketing

What is Ad Fraud?

Ad fraud can come in many shapes and sizes, however, its end goal is always the same: to steal your ad spend by driving fraudulent traffic or conversions to your campaign. Various methods of ad fraud have morphed and advanced since the early 2000s, making today’s fraudsters smarter and trickier than ever before. In order to avoid ad fraud, it’s important to first understand what fraud looks like and the steps you can take to proactively secure your campaigns.

Common Types of Ad Fraud

Unauthorized

Unauthorized Rebrokering

A partner brokering offers to another network leading to payout deflation and a loss of control over where the campaign is being run. Rebrokering is often a source of terms violation.

Click Flooding

A class of mobile fraud wherein partners send large numbers of clicks from real devices in an attempt to obtain the last-click before an install occurs, taking credit for organic users as well.

Falsifying User Data

Individuals attempting to gain CPA conversions through fraudulent means will change their IP addresses and other identifying information that would appear in a User Agent String in an effort to disguise that these are not legitimate conversions. The bad actors will then fill out the call to action with false consumer information, hoping the Marketer does not notice.

Click Spam

A form of fraud in which a fraudster executes clicks in the background of real user engagement within an app, which is often invisible to the user. This can occur when an app is enabled to run continuously in the background or simultaneously while a user is engaging within the app.

Form Stuffing

Consumers regularly fill out offer forms without submitting the form. Fraudsters will take the user’s information from the abandoned form and use it to “stuff” additional forms to simulate the user’s interest in an array of offers. In doing so, the fraudster will get credit for those signups, while the consumer receives communications from marketers without knowingly completing offer forms.

Click Injection

Unique to Android devices, click injection is an advanced form of click fraud wherein the fraudster utilizes malware to steal installs. This malware is hidden inside when an app is downloaded from the app store. From there, the malware will send a click to steal the credit for that install.

Fraud Bots

Bots are among the most common types of fraud and are spreading at an alarming rate. A bot is a code that is programmed to mimic human behavior including installs and post-install engagements.

Distribution

Since fraudsters are not able to predict which devices or IPs their fraudulent clicks will convert on, these partners will often revert to randomly generating engagement over the course of several hours, which is abnormal for partners who are running real, quality traffic.

SDK Spoofing

SDK spoofing is a form of bot-based fraud that often takes the form of malware hidden within an app. The fraudster will generate a click, install, or engagement to steal the attribution from the app where the malware is hidden.

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Ad Fraud within Mobile Marketing

As the mobile space continues to grow rapidly, ad fraud can seem inevitable. There are many different types of mobile fraud, including fake impressions, click spam, false installs, bad bots, and more. Some recent examples of these types of attacks include:

  • Fake Impressions: Google removed and banned 600 apps from its Play store in February 2020 after discovering they were driving false impressions to their own ads
  • Click Spam: Popular online golf retailer, Motogolf, sued a competitor in April 2020 for violating federal and state laws against repeatedly spamming Motogolf’s PPC ads.
  • False Installs: In August 2019, Facebook filed lawsuits against two app developers who were generating fraudulent traffic in order to drive revenue.
  • Bad Bots: It is estimated that e-commerce brands lost $3.8B to click fraud and malicious bot traffic in paid search and social campaigns in 2020; travel and e-learning marketers reportedly lost $2.6B and $830M respectively to the same fraudulent activity.

Over the past year, these fraud types ran rampant as mobile app usage exponentially increased during periods of lockdown. In order to ensure your app is safe from the dangers of mobile fraud, mobile marketers should consider running a CPA marketing model as this model ensures app marketers only pay for genuine installs and engagements. By working on a CPA model, marketers can proactively protect their traffic as this model is the only marketing method that, by its very nature, provides a level of protection that other digital marketing channels cannot.

Pro Tip:

Tactics such as regular campaign monitoring, a cost-per-acquisition model, and employing a wide range of partners can better a marketer’s chances of detecting and protecting against the damaging effects of ad fraud. Learn more about how you can proactively shield your app campaigns from mobile ad fraud.

Protecting Your Brand Against Ad Fraud

While there are several strategies and tools a marketer can use to protect their campaigns from the dangers of fraud, it can be difficult to decipher which are best for your business. 

Perform[cb] employs a wide range of methods to ensure our clients’ campaigns are proactively secured before launching and continuously monitored while active. These methods include:

  • In-House Compliance Team: By employing an in-house Compliance team, Perform[cb] is able to tailor its services to fit each clients’ specific needs. Pairing human compliance practices with a variety of technology solutions ensure each campaign is effectively monitored and protected 24/7.
  • PerformSHIELD™: Perform[cb]’s proprietary anti-fraud software, PerformSHIELD,proactively analyzes marketers’ campaigns prior to launching to identify any vulnerabilities to suspicious activity.
  • Extensive Affiliate Application Review: The Perform[cb] Compliance team utilizes an in-depth application process to ensure only the industry’s top partners have access to our marketers’ campaigns.
  • Real-Time Monitoring: By utilizing its proprietary technologies, in addition to its in-house Compliance team and third-party services such as Forensiq and Appsflyer 360, Perform[cb] analyzes every campaign in real-time to assess for suspicious activity.

The Perform[cb] team has created a field guide to proactively shield and continuously protect your campaigns from ad fraud. Download the guide to start securing your ad spend today.

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Fraud Within Affiliate Marketing

Affiliate marketing is most often based on a cost-per-acquisition (CPA) model, wherein marketers only pay once a consumer has purchased or converted on an offer. Affiliate marketing’s pay-for-results model offers marketers a level of built-in protection that other digital channels cannot. Albeit this additional layer of protection, CPA networks understand the importance of handling campaigns and ad spend with extreme caution.

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Preventing Fraud in Lead Gen Marketing

As the digital marketing realm continues to grow with opportunity, many marketers are seeing success through lead generation marketing. When launching a lead generation campaign on a cost-per-acquisition model, it’s crucial to have the necessary compliance standards in place to proactively prevent fraud. Brand standards and messaging also enable affiliate partners to promote the marketer’s offers and brand accurately. If compliance guidelines and brand standards aren’t correctly enforced, the campaign will be vulnerable to fraud and could be at risk of reaching the wrong audience. 

By proactively implementing brand safety practices, marketers are able to avoid potential fraud and stolen ad spend. Learn how Perform[cb]’s Compliance team proactively identified fraudulent traffic that would have otherwise gone unnoticed for most marketers.

The Future of Digital Ad Fraud

The digital marketing industry is ever-changing, just as compliance practices, fraud prevention, and brand safety standards continue to evolve. With fraudsters projected to steal an estimated $87B in ad spend by 2022, marketers must ensure their offers are secured prior to launching and monitored throughout the lifecycle of the campaign.

Looking to learn more about how you can protect your brand from the hazards of digital ad fraud? We’ve got you covered. Reach out to Perform[cb]’s team of anti-fraud experts now to start proactively protecting your campaigns from ad fraud.

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