A portrait of mobile ad fraud: The bad, the ugly, and the really ugly
Adjust’s in-house mobile ad fraud expert, Andreas Naumann, sat down with a panel of user acquisition whizzes (Checkout51’s Alex Potichnyj, Cyrus Lee from PlayStudios, and Erik Krogh-Jespersen of PocketGems) at Mobile Spree San Francisco to share their war stories from the good fight against ad fraud.
During their half-hour chat, they shared details with the crowd about the fraud schemes they’re dealing with right now, the best ways to open a dialogue with networks about suspicious traffic, and how to build the skill set you need to become a full-time fraud fighter.
Click on the video below to listen to their entire talk now or scroll on further for an overview of the key questions they answered for the audience.
Andreas: What was the first time you encountered fraud? How did you deal with it?
Alex: It happened for us really quickly. The first time we found it, we were looking at UA data and saw 80 million clicks in two days in the USA. We asked someone ‘wait, how many people live in the US’? And it was something like 300 million. So we thought ‘okay, 20 percent of people in the USA - if everyone had a phone - clicked on our ad in the past two days?’ Something’s wrong.
We called our Account Manager at Adjust and said ‘hey, all of our numbers are out of whack! And then we went through them with Andreas, and we got a big wake-up call. There were so many campaigns where we saw a lot of poor/bad/fraudulent traffic.
So we spent a month learning about all of the different tactics used to abuse your ad dollars and things changed dramatically from there. It completely changed the way we buy and measure performance.
Andreas: If you could go back in time to your 2013 self, what piece of advice would you give?
Erik: When you catch that first thing: assume it’s just the beginning. It’s only going to get worse. And worse! So our big wakeup call, we brought in Adjust, they showed us rejected installs and we blacklisted them and thought we’d won! Then we realized that if we caught all that other stuff, there was probably even more going on. And we realized we had to make a choice; when you notice that stuff, do you want to keep on fighting, do you enjoy the fight? Or do you not want to learn everything you need to? My one lesson is to play the game and learn everything you can about it.
Andreas: Since one of the less fun parts of fighting fraud is going back to your supply sources and asking for chargebacks or asking for them to make it right in any way, how do you deal with that? Do you have any special processes or tactics?
Cyrus: Stopping fraud means you have to stay on top of it. The faster you stop the campaign and write it out in an email, the less you have to chargeback. The smaller the amount is, the easier that conversation is to have. It’s a lot easier to ask for $500 back than it is for $200,000 at the end of the month. The speed at which you watch and stop your campaigns when you see something funky is paramount. Make sure everyone is in the same loop of communication- loop in your business person, your AM, your tech person. You’ll need to explain things over and over again- have patience and be ready. You don’t want to blow up your relationship with a whole network and let your ego get too much of you. That can be very hurtful.
Erik: You never know where the problem is coming from, so you have to be careful not to blame. Little things like saying ‘I see some suspicious activity’ instead of ‘I see fraud’, change the language so that you’re not attacking anyone or placing blame before you know what’s going on. Because you don’t immediately know who is causing the issue.
Alex: It’s important to understand that the problem could come from a number of different places. Often, networks are battling with publishers and fraudulent activity may come as a shock to them as well. Be open to that.
Andreas: You all agree that one of the first steps in fighting fraud is educating yourself. That seems like a no-brainer, but what are you tips for getting that knowledge, getting where you need to be to fight fraud?
Erik: Decide you WANT to do it. With 15 people, you could have a specialist or two who can back everyone up. If you’re a team of two, you might decide not to invest in it. But we have an agency partner who specializes in ‘dark markets’, and they’re experts in handling fraud, so we have outside partners who are helping us. You’ve got to decide you’re going after it, and not be wishy-washy. Either you’re going to clean fraud out or you’re not.
Cyrus: It’s a deep rabbit hole. You need to know how much your company can commit. But you can also be more conservative with your choices about how you approach your networks or how many you work with. You can chase it forever.
Andreas: how much time do you give yourselves to feel out a new network?
Alex: You’ll know quickly. I think you know within 24 hours what you’re really going to get, especially if you have the right tools in place. And if you see something suspicious in 24 hours, you have to say to yourself ‘is this something I could do every day for the next month?’
Andreas: Ad fraud has been a buzzword this whole year. Transparency is another one that comes up a lot. How much transparency do you see? Is it growing? Does it help in your relationships with your networks or fighting fraud?
Erik: I think you get what you put in. I get transparency because I keep on catching stuff and I mention that to other networks and let them know ‘hey, lately I’ve been seeing this type of emulator fraud; I saw it with these guys’. It’s like a warning-- letting them know that I’ll catch it with them if they try it, too. You can apply pressure with your own knowledge; I don’t think anyone has ever been very transparent without applying at least some pressure.
Audience question: What are the top two fraud types that you see? Click injections? Anonymous installs?
Alex: We’ve experienced a lot of click spamming and stealing our organics, and anonymous IP installs. We’re only in the US and Canada and there were some resources with just 10, 20, 30 percent anonymous IPs. That just doesn’t exist in terms of the percentage of people who use anonymous IPs on their phone.
Erik: We see a lot of click spam and really smart emulators that are trying to play the game. They do stuff like trigger purchase events, but then there’s no revenue. Or they’ll fake retention, which is really sneaky. We have some internal defenses for that, but I’ve caught it in a lot of different forms and it looks real, and it feels like it’s on the rise.
Audience Question: Where do you see the mobile marketing industry going? Do you see yourself continuing to battle fraud? There are new kinds that come out every few months. Do you ever see yourselves accepting it and adding it to your costs, and deciding ‘that’s just the way it is’?
Alex: Fraud is not going anywhere. You’ll always need tools. When there’s this level of money being spent on media, fraudsters will just get smarter. The future is networks that are on the side of the advertiser and also take a stance against fraud. They’ll team up with their advertisers and publishers and attribution providers at the end of the day. Companies will spend where the networks are on their side.
Cyrus: I don’t think the fight is ever over. I think more and more money will be devoted to protecting your ad spend in the future.
Erik: I can’t imagine we’ll incorporate fraud. Because kids stealing from the candy jar - that’s something like two percent of your sales. But if you’re not watching fraud, that’s 90% of your ad budget gone. You’ll have no idea what’s going on. I can’t imagine not paying attention to it. I spend a lot of time thinking ‘how can I mount a counterinsurgency?’ I would be really interested to see companies that have tools to outdo fraudsters. If one company could figure that out, they’d make a ton of money.
That's all for now! For lots more on the different sources of fraud, how they affect your campaigns, and what you can do to fight them, download Adjust's mobile fraud guide here.