Only 5% of ad networks are high fraud, but they own 20% of mobile ad clicks

Fraud lives in the dark, and where there’s a lack of transparency all the way from advertisers to customers, fraud grows.

But fraud is also disproportionately a factor for larger ad networks.

We recently studied mobile ad fraud globally, finding in a comprehensive study of 24 billion clicks on 700 ad networks that 15.2% of mobile ads are fraudulent in some way. What we didn’t reveal at the time is that while the ad networks that are high in fraud tend to be few in number, they also tend to two extremes.

Very fraudulent ad networks, with fraud rates of 50% to 100%, tend to be small niche players. We found eight of them at 100% in our study.

But any ad network with over 5% fraud is concerning, and I consider ad networks to be high in fraud if they have an average fraud rate of 20% or higher. We found 34 ad networks that fit that bill, most of which are in the 20% to 30% range.

Here’s the core problem: these few ad networks are disproportionately large.

34 ad networks is 5% of the 700 that we studied. This 5% of ad networks, however, represents 21.6% of all of the 24.3 billion clicks that we found. That means that fraudulent ad networks, on average, tend to be about four times bigger than non-fraudulent ad networks.

And that means that marketers need to be very, very careful.

Get our full report on mobile ad fraud here, for free.

Author

Before acting as a mobile economist for TUNE, John built the VB Insight research team at VentureBeat and managed teams creating software for partners like Intel and Disney. In addition, he led technical teams, built social sites and mobile apps, and consulted on mobile, social, and IoT. In 2014, he was named to Folio's top 100 of the media industry's "most innovative entrepreneurs and market shaker-uppers." John lives in British Columbia, Canada with his family, where he coaches baseball and hockey, though not at the same time.