Explosive growth in mobile betting means massive wins but hidden dangers amid rising fraud

Decreasing data plan costs and expanding mobile networks are allowing more people than ever to enjoy online gaming writes Mathew Ratty, CEO and founder of ad fraud prevention provider TrafficGuard.

Mobile betting draws in the majority share of online gamblers, especially younger bettors. The Gambling Commission found that three quarters of 18–34 year-olds use a smartphone as their primary method of gambling in the UK.

According to Market Research Future, the mobile betting market is projected to reach $173.87 billion by 2032. However, with this growth comes a considerable target on sportsbooks’ backs as fraudsters follow the money.

Last year, mobile betting accounted for over 70 per cent of all sports wagers placed globally according to Grand View Research. While this growth offers unparalleled comfort and accessibility for customers, it also brings an increased risk of fraud for sportsbooks, with reported fraud attempts rising by 30 per cent in the past year.

Innovations in mobile technology have led to considerable changes in the sports betting industry as mobile betting has taken over.

The convenience provided by mobiles coupled with the availability of live betting has contributed to mobile gaming’s rise to the top over the past couple years. The growth of mobile betting has provided new comfort for customers, but with it comes an increased risk of fraud for sportsbooks.

As mobile betting continues to dominate online gambling, this significantly increases the chances that fraudsters will try and take advantage of sportsbooks. To avoid falling victim to fraudulent activity, it’s vital that sportsbooks put steps into place to protect themselves and mobile bettors.

The methods employed by fraudsters are becoming increasingly sophisticated and difficult to identify. Non-genuine engagement generated from invalid sources, such as fraudsters, is preventing sportsbooks’ campaigns from reaching their full potential by draining budgets. To attain the maximum value from their advertising efforts and protect themselves from fraud, sportsbooks need to take a proactive stance.

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Rise in Sophisticated Fraud

The global increase in internet access is driving the growth of the online gambling market.

One major issue sportsbooks face is mobile app install attribution stealing. Fraudsters employ sophisticated methods to falsely claim credit for user installs that should be attributed to legitimate marketing partners. This deceitful practice drains budgets and hampers the effectiveness of digital campaigns. Common tactics include click spamming, where fraudsters generate fake clicks to create a false attribution trail, and SDK spoofing, where they simulate legitimate app installations.

Additionally, fraudsters generate invalid traffic (IVT) to interfere with digital campaigns by artificially inflating impressions. This fraudulent activity slips by unnoticed, making campaigns appear to perform better than they actually are. As a result, sportsbooks mistakenly allocate their ad spend to underperforming areas, wasting resources while fraudsters profit.

The rapid evolution of technology has made it easier for threat actors to launch large-scale attacks on sportsbooks and mobile bettors. AI-powered bots, for example, can create floods of fake accounts to exploit promotions or skew campaign data. Our research indicates that, on average, around 5-7% of sports betting campaigns are affected by such fraud.

Mobiles usually deploy conventional anti-fraud tools that are incapable of identifying IVT. These tools don’t operate at the impression or click level, this leaves sportsbooks open to having their resources drained.

There are other forms of non-genuine engagement harming digital campaigns. Customer Acquisition Costs (CACs) are being driven up behind the scenes by returning users. These users use paid brand advertisements to navigate back to sportsbooks’ websites quickly. As these users don’t generate new conversions, they waste ad spend, preventing new and genuine users from seeing the ad. While this isn’t the intention of returning users, it’s causing sportsbooks a significant loss.

Sportsbooks need to develop a strategy to control their traffic and prevent fraudulent activity. Without measures in place, bettors and sportsbooks alike continue to be vulnerable.

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Achieving Traffic Transparency

Mobile betting isn’t going anywhere, so sportsbooks should focus on bolstering mobile security to mitigate fraud and ensure their campaigns can succeed in a thriving market. IVT succeeds by remaining invisible to systems. This means transparency and visibility are key components sportsbooks can use in their anti-fraud strategy. Regularly monitoring traffic can identify potential threats to your campaigns, which can then be dealt with.

This can be further augmented with an ad-verification platform. Bots can be sent in overwhelming numbers, and these platforms can fill in any gaps in the system. Traffic can be verified in real-time, and any suspicious activity can be reported and blocked. This boosts operational efficiency and mitigates the threat to budgets.

Bots and other forms of non-genuine activity can also be blocked with custom verification rules. By setting these rules, sportsbooks can limit the number of times a bot or returning user clicks on an advert. This prevents them from seeing and repeatedly engaging with the ad after reaching a set threshold. Cost per Click (CPC) rates can be significantly reduced by these rules, while also stopping spam from bots.

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Keeping Profits in Sportsbooks’ Pockets

The mobile betting market is booming globally, presenting sportsbooks with the chance for increased reach and profits. To ensure future success in the market, sportsbooks need to maximise their campaign value. The first step is to block fraud from draining profits.

By taking an active role in monitoring and verifying their traffic, sportsbooks can gain transparency into their systems and stop fraud before any harm is done to budgets. This way, sportsbooks will be the only one enjoying their profits – not fraudsters.

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