Comment & Opinion

Don’t let fraudsters dictate your user acquisition strategy

Don’t let fraudsters dictate your user acquisition strategy

Olga Bazarova is global marketing and product growth manager at Scalarr.

Every user acquisition manager’s ultimate goal is to ensure the steady stream of new users while spending smarter and more effectively than the competition. In order to get there, user acquisition managers need to constantly revise, measure, and scale up (or down) their traffic channels.

One of the biggest challenges that User Acquisition Managers often stumble upon when trying to access the performance of advertising campaigns is mobile ad fraud. With an estimated 26 per cent of all mobile app install advertising going to fraudsters in 2019, it’s hard to exaggerate the size of this issue.

However, mobile ad fraud has grown from a no-name issue to a bloated, deadweight problem that often strikes an almost mythical fear into marketers. But is big enough to let it take over your user acquisition strategy?

Why “trusted” sources are not a lifebelt

User acquisition managers are hungrily extolling the rise of the so-called “trusted” traffic sources (Google Ads, YouTube, Facebook, video ad networks, etcetera.) and all the benefits they promise, namely: custom-tailored ad campaigns, a wide range of ad inventory, high engagement, and supposedly lower fraud rates. All that allows Facebook and Google to dominate the field, creating a sort of duopoly on the ad buying market.

At the same time, it would have been surprising if that duopoly didn’t come with a set of downsides, especially in terms of costs - “trusted” sources indeed have much higher CPI (cost per install) and CPA (cost per action) rates and entry thresholds.

While it’s fair to say that higher user acquisition costs may - at least for some app categories - be offset by a higher revenue per user, the total revenue against the customer acquisition cost across “trusted” sources tends to be lower.

What’s more, the allegation that “trusted” sources are immune to fraud is somewhat questionable, particularly in the light of the recent events. The click spam scheme behind Kika and Cheetah Mobile apps, the discovery of “Drainer Bot”, and other eye-opening news are a solid proof that Google can no longer be considered a safe house for user acquisition managers.

In reality, mobile ad fraud across Google and other “trusted” sources is a much bigger issue than it seems. In fact, it’s on the upswing.

In reality, mobile ad fraud across Google and other “trusted” sources is a much bigger issue than it seems. In fact, it’s on the upswing.

According to the mobile ad fraud detection company Scalarr, fraud can reach five per cent of all traffic buying in trusted sources in 2019, as opposed to only 1.2 percent in 2018. With more and more marketing money being directed to the Google-Facebook duopoly, that trend will likely continue to grow in the upcoming years.

Daniel Lopez, senior user acquisition manager at DraftKings, believes that the best strategy in buying traffic is “not to leave any stone unturned".

“Draftkings want to be empowered to buy anywhere you want without being worried about fraud and being forced to only buy on the more expensive sources,” he says.

“That is why we pay great attention to mobile ad fraud, arming ourselves with a good third-party anti-fraud solution.”

The freedom of choice

While Facebook and Google are still the most popular traffic sources that should be present in every user acquisition strategy, there’s always a high risk of putting too many eggs in one basket.

First of all, these “trusted” sources are by and large “black boxes” that don’t offer any convenient way to manually optimise ad campaigns.

Google, for example, places ads in several channels, including Google Search, YouTube, and third-party apps. The process of placing an ad is governed by a finicky algorithm that advertisers cannot access. As a result, ad placement channels are often left to chance.

Ultimately, savvy UA managers should be testing every available channel of growth, analysing the outcomes and choosing those with the biggest potential.

Secondly, by limiting their traffic channels to just a handful of sources, user acquisition managers can jeopardise their business. There are potential risks that may arise in the process: the platform can fail, the traffic can slow down, the advertiser account can get suspended. On the contrary, diversifying traffic sources can minimise these risks and protect the campaign if one of the revenue streams suddenly dries out.

What’s even more important, marketers should be concerned about the concentration of power in the hands of “advertising kingpins”, that not only own the digital advertising playing field but are also able to set the rules of the game.

That, in turn, will lead to a further dramatic increase in CPI and CPA rates, which are already well above the market’s average.

Breaking the chain

When it comes to launching a successful user acquisition campaign, you need all the inventory you can get. Ultimately, savvy user acquisition managers should be testing every available channel of growth, analysing the outcomes and choosing those with the biggest potential. There’s no room for fraudsters in this consistent picture.

It’s true that mobile ad fraud is a massive issue that can’t be put aside. However, fight against fraudsters is an ongoing battle, not a death march. With an advanced anti-fraud solution in place, marketers can not only spare advertising budgets but look above and beyond the “trusted” sources.

At the end of the day, the freedom to choose the most effective channel without having to worry about fraud is every user acquisition manager’s keystone to success.

Comments

3 comments
View options
  • Order by latest to oldest
  • Order by oldest to latest
  • Show all replies
Steve Webb Pub Sol EMEA at Audience Network
Hi Olga - interesting article and report, It’s good to see awareness of this topic being raised and addressed. You reference FB as being one of the "trusted sources", I'm glad we are seen in this bracket - however the subsequent flags on risks with this are all cited as being with Google, did you analysis show any specific concerns with FB that I can take and share with the relevant teams? Secondly the article states "fraud can reach five per cent of all traffic buying in trusted sources in 2019" but the reports states this is a projection and was 1.5% in 2018. Is there anything specific causing this jump that you can share, again so I’d like to make sure we have awareness internally on this. Thanks!
Olga Bazarova
Hi Steve, I am pleased that you liked the article and report!
Answering your question, I would say that at the moment we at Scalarr have not found clear fraud patterns on Facebook, but we would be happy to discuss our concerns about fraud in trusted sources with you or Facebook analytics team.

Regarding the fraud growth in trusted sources from 1.5% in 2018 to 5% (this is our projection) in 2019, there are several objective reasons why this happens:
1) We see a clear trend that marketing budgets are more and more directed towards trusted sources (about 65% or even more of the mobile traffic is purchased in trusted sources like Google Ads, Facebook, etc.) and fraudsters is now aimed at penetrating trusted sources as well, hence the fraud rate is on the rise.
2) In 2018 we started seeing more fraud patterns specific to smart bots and intelligent device farms from trusted sources. Fraudsters have learned to manipulate the system by imitating real user behavior and may go undetected for a long time for most traditional anti-fraud solutions and mobile marketers.

Hope this was helpful!

My colleague Irina will contact you by email to discuss this in more detail.
Thanks!
Steve Webb Pub Sol EMEA at Audience Network
if easier feel free to mail me on swebb@fb.com