Setting Hurdles for Mobile Gaming App Fraud

As the online sports betting industry continues to grow, so too do its fraud risks. TrafficGuard CMO Chad Kinlay (l.) breaks down how bookmakers can combat these evolving risks.

‍

In today’s digital landscape, mobile betting is transforming the sports wagering industry. This shift has significantly impacted platform development, with a strong focus on delivering mobile-optimized betting experiences. More bettors than ever are choosing to go online as on-device app accessibility provides them with unparalleled convenience.

The ease of accessibility for seasoned and rookie bettors alike has positioned mobile betting as the preferred platform of choice. In 2023 alone, mobile betting accounted for over 70 percent of all sports wagers placed globally according to Grand View Research. The impact of mobile is undeniable—however, it has opened up sportsbooks to a new challenge.

While sportsbooks are focusing resources on mobile gaming, fraudsters have taken notice. The success of the industry significantly increases the chances that fraudsters will target sportsbooks. Non-genuine engagement from invalid sources like threat actors is draining budgets behind sportsbooks’ backs. To prevent this and protect mobile bettors, it’s crucial that sportsbooks act now.

Advertising Fraud on the Rise

As mobile advertising continues to expand, the sophistication of advertising fraud grows, making it more difficult to detect. Mobile makes an easy target for fraud as their systems aren’t optimized against ad fraud. For example, fraudsters can utilize invalid traffic (IVT) to artificially inflate impressions and siphon profits. Mobile security typically doesn’t analyze traffic at the click or impression level, it passes through security unnoticed. Campaigns then appear to be performing well, when in reality the traffic is from a source that will never lead to a conversion. The sportsbook will then mistakenly direct resources towards an underperforming campaign.

A major challenge facing sportsbooks is mobile app install attribution stealing. This tactic involves the fraudster falsely claiming credit for a user install that should rightfully be attributed to a legitimate marketing partner. This damages the effectiveness of campaigns and drains budgets. Fraudsters typically deploy tactics such as software development kit (SDK) spoofing, which involves simulating legitimate app installations, and click spamming, where they generate fake clicks to create a false attribution trail.

Further advancements in artificial intelligence (AI) technologies have also made it easier for fraudsters to carry out attacks on a much larger scale. Fraudulent bots powered by AI can be used to abuse promotions and bonuses from sportsbooks’ campaigns or tamper with their metrics. According to imperva, bots such as these are responsible for around 24 percent of all clicks, contributing significantly to click fraud.

Non-genuine engagement doesn’t only come directly from threat actors. Returning users can also inadvertently contribute to wasted ad budgets. This occurs when users navigate back to a sportsbooks’ site via a web browser rather than an app, clicking on a paid brand advertisement instead of typing the URL directly. These users don’t generate new conversions, instead driving up customer acquisition costs (CACs), preventing new and genuine users from seeing the campaign. While this is accidental, it’s still causing considerable damage to advertising budgets as spend is wasted without any payoff.

To block fraudulent engagement and ensure the protection of their mobile bettors, sportsbooks need to have a strategy in place. This way, they can reap the benefits of the growing mobile betting market.

Combating Fraud with Transparency

To combat threat actors and their impact on mobile marketing campaigns, sportsbooks need to adopt a multifaceted strategy:

1. Regular Traffic Analysis: Despite the increased sophistication of fraud, tactics like IVT do still leave behind warning signs that sportsbooks can pick up on. Regularly monitoring and analyzing traffic for these signs can help to identify and block fraudulent engagement before any harm is done. Signs could include suspicious accounts, sudden high pageviews, or abnormal traffic spikes from an unexpected region or unknown source.
2. Leverage Fraud Detection Tools: The legacy anti-fraud tools mobile systems utilize are no longer able to keep up with the advancement of fraud. With fraud, timing is crucial, so implementing tools that can identify and block fraud in real-time is integral to preventing campaign data tampering.
3. Custom Verification Rules: Bots and returning users typically drain budgets by frequently engaging with an ad campaign. By setting custom verification rules, it’s possible to limit the number of times a particular user can see and engage with an ad campaign. With these rules in place, bots are prevented from click-spamming adverts and driving up cost per click (CPC) rates.

Ensuring Future Successes

The growth of the mobile gaming market is showing no signs of slowing, giving sportsbooks the chance to reach a much wider audience. But to profit from this opportunity, sportsbooks can’t risk losing budgets to fraud.

A proactive stance is critical as fraudsters develop more sophisticated methods. Fraudsters count on their tactics going unnoticed, but with regular monitoring and verification of traffic, they can be exposed and stopped. Sportsbooks can be ensured their ad budgets are protected, and that they are the only ones enjoying their profits.

‍

‍

Read the full article here.

‍