mobile ad fraud and how bad guys commit the fraud using bots

1. Augustine Fou- 1 -
Dr. Augustine Fou
acfou [at] mktsci.com
http://linkd.in/augustinefou
November 2014
Mobile Ad Fraud
101

2. Augustine Fou- 2 -
Main Types of Digital Ads
Impressions
(CPM/CPV)
Clicks
(CPC)
Leads
(CPL)
Sales
(CPA)
• Display ads
• Video ads
• Social display
• Mobile display
• Search ads
• Mobile search
• Affiliate
revenue share
• Completed
lead forms
sold on cost-
per-lead basis

3. Augustine Fou- 3 -
Digital Ad Spend (IAB FY 2013)
Impressions
(CPM/CPV)
Clicks
(CPC)
Leads
(CPL)
Sales
(CPA)
Search 43%
$18.5B
Video 7%
$3.0B
Lead Gen 4%
$1.7B
11% Other
$4.8B
Source: IAB, FY 2013 Internet Advertising Report, April 2014
$36.2B
Display 19%
$8.2B
Mobile 15%
$3.7B$2.8B
NOTE: figures from IAB FY 2013
($43B annual ad spend)
CPM Performance
• classifieds
• sponsorship
• rich media
• email
$6.5B

4. Augustine Fou- 4 -
Prime Target for Ad Fraud
Impressions
(CPM/CPV)
Clicks
(CPC)
Search
$18.5B
84% digital spend
Display
$8.2B
Video
$3.0B
Mobile
$3.7B$2.8B
Leads
(CPL)
Sales
(CPA)
Lead Gen 4%
$1.7B
11% Other
$4.8B
• classifieds
• sponsorship
• rich media
• email
16%

5. Augustine Fou- 5 -
Where mobile ads fit
mobile display ad mobile search ad

6. Augustine Fou- 6 -
Bad Guys Use Simulators
Normally used by
developers to test their
apps before launch,
mobile simulators are
used by bad guys to load
apps and generate fake ad
impressions.

7. Augustine Fou- 7 -
Bad Guys Use Malware
Once malware gets onto a
mobile device, it can do many
nasty things, not limited to
stealing personal info and
passwords.
The malware can also be
directed to load ads or click
ads in the background without
the users’ knowledge,
especially in an “always
connected” environment.
Source: Forbes, March 2014

8. Augustine Fou- 8 -
Bad Guys Repackage Apps
Bad guys “repackage” super
popular apps and even
plagiarize their icons and
graphics. So unsuspecting
consumers download the
malware-repackaged version
of the app without knowing.
These apps do malicious
things and also load ads in the
background or can be used as
part of botnets.
Source: Forbes, March 2014

9. Augustine Fou- 9 -
Bad Guys Cheat
Research Team at UC Davis reports:
1) 130,339 apps crawled from 19 Android markets including Play and many third-party
markets, and 2) 35,087 apps that likely contain malware provided by a security
company.
From analyzing these datasets, we find that about
30% of apps with ads make ad requests while in running in the background.
In addition, we find 27 apps which generate clicks without user interaction.
We find that the click fraud apps attempt to remain stealthy when fabricating ad traffic
by only periodically sending clicks and changing which ad provider is being targeted
between installations.
Source: UC Davis Researchers

10. Augustine Fou- 10 -
Bot Traffic Estimates
Source: Solve Media March 2014

11. Augustine Fou- 11 -
Dr. Augustine Fou – Technical Forensics
“I advise clients on optimizing
advertising across all channels. One
main area of focus is reducing ad waste
due to fraud – fake impressions, clicks,
leads, and sales – which produces
immediate ROI.”
FORMER CHIEF DIGITAL OFFICER, HCG (OMNICOM)
MCKINSEY CONSULTANT
CLIENT SIDE / AGENCY SIDE EXPERIENCE
PROFESSOR AND COLUMNIST
ENTREPRENEUR / SMALL BUSINESS OWNER
PHD MATERIALS SCIENCE (MIT '95) AT AGE 23
@acfou
ClickZ Articles: http://bit.ly/augustine-fou-clickz
Slideshares: http://bit.ly/augustine-fou-slideshares
LinkedIn: http://linkd.in/augustinefou

12. Augustine Fou- 12 -
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