The advent of any new technology is unavoidably accompanied by its misuse. Ad Fraud is one of the biggest challenges that digital advertising is currently facing.
According to Business Insider, Digital Ad Fraud cost is estimated to hit $44 Billion this year, accounting for 45% of the total ad spend. Hence, it becomes extremely crucial for advertisers and publishers to stay aware of and ahead of those who abuse their system for financial gain.
Read further to learn more about the 8 types of Ad Fraud, understand how ad fraud works, and the measures you could take to detect and prevent ad fraud.
What Is Ad Fraud?
Any attempt to misuse or defraud digital advertising networks for financial gain is termed ad fraud. Scammers usually use bots for this purpose. However, there are numerous ways ad fraud is done.
Ad fraud can be carried out through human and non-human traffic.
Ad fraud types that use non-human traffic include Emulators, Simple Bots, Sophisticated Bots, SDK Spoofing, Bot Farms, and Device Farms.
Ad fraud types that use human traffic include Click Farms, Click Injection, Click Spamming, Invisible Ads or Ad Stacking, Pixel Stuffing, Cookie Stuffing, Domain Spoofing, and Ad Injection.
What is Mobile Ad Fraud?
Mobile ad fraud is a subset of ad fraud. The objective is to gain ad revenue from the ads that don’t have the potential of getting viewed.
Fraudsters try to manipulate impressions and trick advertisers and ad networks into paying them by artificial methods.
How Does Ad Fraud Work?
Now that we know what ad fraud is, let’s understand how ad fraud works. There are different categories of how ad fraud is done.
Other categories of mobile ad fraud include:
- Real user and real device with fake action: Scammers attempt to steal real organic installs through click spamming.
- Read user and real device with manipulated action: Scammers manipulate action through VPN, viewability issues, and click stuffing.
- Fake user with a real device and fake action: Scammers mimic the behavior of real users on real devices.
- Fake user with a fake device and fake action: Smart bots and emulators are used by scammers to manipulate and mimic the action of real users.
How To Detect Ad Fraud?
App publishers and advertisers can use certain observations to detect ad fraud:
- Lack of performance – One of the clear signs of ad fraud is Poor or zero performance from digital advertisements.
- Poor Analytics – Short sessions and high bounce rates will reveal ad fraud.
- CTRs from Inhuman activity – Very high or too less CTR than the average will mostly be bot activity or ad fraud.
- Tracking IP addresses – If the IP addresses trace to a corporate or private computer, it is a real person. If the IP traces back to a server, it is ad fraud.
How To Stop Ad Fraud?
Is ad fraud illegal? Yes, it definitely is! However, there is no silver bullet to stop ad fraud. App developers must work proactively to detect ad fraud as soon as possible in their ad networks.
Some of the most effective ways to prevent ad fraud are listed below:
- Have a list of blacklisted IP addresses
- Watch out for copyright theft
- Keep track of your metrics
- Look out for any anomalies
- Work only with a trusted vendor
- Keep your legal team informed
- Check third-party plugins and scripts
8 Types of Ad Fraud
- Domain spoofing: It is a fraudulent activity where the fraudster impersonates a known business or a person with a fake domain to fool people into trusting them.
- Cookie stuffing: It is a form of illegitimate activity where a third party drops multiple affiliate cookies on the user’s browser to claim gains from the sales happening through the ads.
- Pixel stuffing: Ads are placed on top of a normal ad but as a tiny pixel-size 1×1 block using an iframe, making the ads invisible to the users. The fraudster would gain impression revenue from these hidden ads.
- Ad stacking: Multiple ads are stacked on top of each other in a single ad placement. While only the top ad is visible to the user, a click or impression is registered for every ad in the stack, leading advertisers to pay for fake impressions and clicks.
- Ad injection: Ad sneaks into the space of belongs to another ad through malicious software and adware plugins.
- Geo masking: With this technique, fraudsters can make low-quality users appear high quality, thus making money from advertisers.
- Click Farms: A large number of clicks are generated on paid advertising links by low-paid workers. They also click on the ad, install and even engage with apps to simulate a lucrative engagement bringing in real traffic.
- Malicious Bots: Fraudsters use bots to create invalid traffic. This traffic is not human-generated. Bots are also used to impact performance. However, not all bots are bad.
The problem with ad fraud is that it is irreversible once the damage is done. The only way is to prevent even the slightest possibility of it happening.
To combat ad fraud, publishers and advertisers must be aware and take necessary steps to ensure ads reach actual users and not scammers.
Working with experts who can prevent fraudulent activities and ensure the ads are seen by real human traffic is the best solution for publishers and advertisers.
To learn more, get in touch with our experts. We are empowering businesses around the world and helping publishers focus on creating great apps – while we take care of the rest!