Ad Fraud Roundup: How much are fraudsters costing advertisers?

Samuel Harries

Jul 2, 2019

App marketers need to embrace data, but it's tough when the numbers don't always add up. For example, two recently published reports – both rich in data-driven insights – show vastly different figures relating to ad fraud. To try and clear the fog, we dive into their findings and learn why multiple mobile ad fraud reports may lead to uncertainty.

On one hand: fraudsters will steal 21% more advertising spend this year

Advertisers will hand over considerably more of their ad spend to fraudsters in 2019, according to a new study from Juniper Research. This includes fraud online, on mobile and in-app. The key takeaway: ad fraud is on the rise, set to increase 21% to $42 billion, up from $35 million in 2018.

So, what are the drivers? Juniper Research blames the increase on a lack of adoption of anti-fraud solutions from smaller advertisers. As a result, “advertisers will only save $16 billion of potential lost ad spend to fraud.” The report also cites the complexity of fraud tactics and the increase in ad inventory as reasons for the increase in losses.

On the other hand: mobile ad fraud is under 2017 levels

Dramatically different findings come from anti-fraud vendor White Ops and advertising trade group, the Association of National Advertisers (ANA). They estimate that $5.8 billion will be lost globally this year – a figure that is 9x smaller than Juniper Research’s estimate. The White Ops’ report – which analyzed 27 billion ad impressions across 50 brand marketers – suggests the amount of advertising spend lost to fraudsters is in decline, and “for the first time even more fraud will be stopped than will succeed.” In 2017, their estimated figure was $6.5 billion.

What should marketers believe?

With varying estimates, it can be hard to know the true scale of the problem – and you’re probably wondering how there can be so much disparity between reports. Emarketer suggests that this occurs because “there is currently no one way to detect whether an ad impression is fraudulent or not.” (In fact, there is a simple way to do this, it just hasn’t been adopted industry-wide yet). They also explain that “anti-fraud vendors rely on different methodologies and verification technologies for their work.”

Our own Global App Trends report, which is based on anonymized data collected across the top 1,000 best-performing apps on our platform, showed that Adjust rejected close to 300 million (269,036,991) fraudulent installs in 2018. This data set spans over 7 billion installs and 120 billion sessions. Almost half (48%) of those were Click Injection fraud, followed by Click Spam (26%), SDK Spoofing (17%) and Fake Installs (9%). The bottom line: ad fraud is still a widespread problem across all verticals, and advertisers need prevention tools to avoid leaving their front door open to fraudsters.

In other news, attacks on TV apps have more than doubled in the last 12 months

The 2019 Global Insights Report from DoubleVerify – a platform that authenticates the quality of digital media – provides an analysis of its impressions (for display and video ads on desktop, mobile and CTV) over the past 12 months, analyzing data across more than 1,000 brands. The report highlights that fraudsters are increasingly targeting connected TV apps. Ad fraudsters are always looking to exploit high-growth environments, so it’s important for marketers to be aware of (and vigilant against) new ways fraudsters can steal their ad spend.

From SDK spoofing and click injection to in-app bot abuse, the fight against fraud is widespread and ongoing. If you’d like to learn more about how Adjust is leading the fight against fraud, take a look at our fraud prevention suite. We are also proud founders of the Coalition Against Ad Fraud (CAAF), and combat in-app bot fraud with Unbotify.

Want the latest fraud news and helpful insights to make sense of it all? Don’t miss our regular fraud roundups.

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