Proactive Ad Fraud Prevention With Artificial Intelligence

As marketers grapple with the problem of ad fraud and its mounting losses, artificial intelligence (AI) is proving to be an effective weapon that can reverse the tide.

Marketers in Asia Pacific continue to throw money at advertising, as ad spending is expected to increase 10.7 percent to US$210.43 billion in 2018, according to eMarketer. However, the ever-growing problem of ad fraud is skewing their reporting and standing in their way of showing better returns.

Even mobile marketers who expected more safety with app installs, faced 30 percent more fraud during the first quarter of 2018 compared to the same period last year, according to AppsFlyer’s “The State of Mobile Fraud: Q1 2018” study. Mobile app marketers were exposed to US$700-US$800 million in ad fraud losses worldwide. What makes ad fraud such a challenging problem today?

More Sophisticated Ad Fraud Methods Today

In the early days of ad fraud, the methods adopted by fraudsters were relatively simple. They used bots focused on driving large volumes of traffic to websites, bought cheap traffic through auto redirects or employed people to install apps in click farms. Once a click was made or an app was installed, their job was done. However, this was soon caught by advertisers and their focus began shifting to examining post-install quality, engagement, last-click attribution and return on investment (ROI).

Today, ad fraud has evolved into a completely different beast. For example, in a technique called ‘click injection’, they try to steal credit for app installs by triggering a click right before these apps get installed. Or, they stack up ads on top of each other to generate impressions for multiple ads.

Fraudsters also realize that to remain undetected, they not only need to drive traffic to websites or generate large amount of app installs, but also remain engaged subsequently and mimic human behavior. They even employ human workers in click-farms to imitate real human interactions, develop apps that hijack devices to generate additional clicks and create simulators that generate fake installs from bot networks.

Brands Turn to Technology for Help

Big brands and major publishers have begun to act against ad fraud. The Guardian recently collaborated with Google and MightyHive, a programmatic solution provider, to investigate programmatic fraud. Adobe Advertising Cloud has partnered with cybersecurity firm White Ops to tackle the problem in the streaming TV media.

Another technology that is gaining traction among marketers is blockchain, thanks to its ability to enforce decentralized monitoring and independent verification. However, there are still many challenges to be addressed, like handling the massive transaction volumes involved in real-time bidding and getting universal acceptance from everyone involved.

Joe Su, Chief Technology Officer and Co-founder of Appier, explains, “I think it will be a while before everyone in the supply chain – from media buyers to ad exchanges and publishers – cooperates to opt into a universal standard to make it feasible.”

Sophisticated Detection Powered by Machine Learning

Traditional approaches in fraud detection rely on simple rules created by humans through the measurement of three signals (metrics like conversion rate and click time) or dimensions at most. For example, IP blacklists to block suspicious traffic and filter out installs with low click-to-install-time (CTIT) have worked in the past.

However, the problem with these fixed rules is that they are pre-defined, as advertisers approach detection knowing what they are looking for. For example, one might decide to exclude app installs with CTIT below 10 seconds, due to the higher likelihood of bot-operated installs in these cases. But if such rules are fixed ahead of time, it’s only a matter of time before fraudsters figure out ways to circumvent them.

A more effective solution is to leverage technology that can keep pace with, and more importantly, stay ahead of today’s ad fraud techniques. That means marketers need to go beyond simple, fixed rule-based criteria, towards AI-powered solutions that are capable of learning new fraud patterns and refining the rules on their own.

As fraudsters employ new techniques that are capable of mimicking human behavior, these machine learning algorithms can help marketers look for fraudulent behavior not immediately evident to the human eye. This is especially critical in the case of app installs, where detecting fraudulent clicks and impressions before install becomes paramount.

“Looking for signals like suspiciously low time between clicks and installs or CTIT can indicate fraud, but by the time the install has occurred, it would be too late and an attribution for the install has already been counted,” said Su.

One foundational AI-approach, called the “tree-based model” works by analyzing a massive number of signals to achieve maximum coverage and accuracy in detecting outlier behavior. Consider the case of “the chameleon”, where fraudsters mimic legitimate publishers and generate installs at a later date, when the natural user retention is expected to drop.

Another scenario is that of an “inventory burst” where inventory count from a suspicious publisher spikes at a time when generally the in-app registration falls. As machine learning algorithms learn from gathered data over time, both these sophisticated ad patterns can be detected and fed back into the filters for improved detection in the future.

By detecting more cases of ad fraud, marketers can weed out poor quality traffic and measure their returns on advertising spend (ROAS) more accurately. In a study of 5.2 billion data points from mobile app campaigns in the region, Appier detected twice the number of suspicious installs using an AI-based approach and realized 4 percent more ROAS, compared to a traditional approach.

It won’t be long before fraudsters develop even more novel techniques to try and escape detection. Advertisers who are vigilant and proactive in preventing this with AI-based fraud detection will be in a better place than their competitors to reap the benefits of their investment.

How Appier Fights Ad Fraud with Artificial Intelligence

Ad fraud is costing the industry billions of dollars. Joe Su, Appier’s Chief Technology Office, described in a blog post how Appier is using artificial intelligence to fight ad fraud. This infographic summarises how AI can help combat one of the top scourges of the advertising industry.

About Appier

Appier is a technology company which aims to provide artificial intelligence platforms to help enterprises solve their most challenging business problems. For more information please visit www.appier.com.

Fighting Ad Fraud with Artificial Intelligence

By Joe Su, Chief Technology Officer and co-founder, Appier

Advertising fraud, ad fraud for short, has become a major threat to the digital advertising industry. According to the Association of National Advertisers in the US, ad fraud will cost companies an estimated US$6.5 billion in 2017. A recent report by Juniper Research paints an even grimmer picture, estimating advertisers will lose US$19 billion to fraudulent activities next year. This figure, representing advertising on online and mobile devices, will continue to rise, reaching US$44 billion by 2022.

The industry has spent considerable resources looking for effective ways to mitigate the effects of ad fraud. I use mitigate deliberately because just as with cyber fraud or financial fraud, there is no way to totally eradicate the problem: you can only hope to stay one step ahead of the bad guys.

Most ad fraud countermeasures have centred on rule-based methods and these are effective ways to combat simple ad fraud activities. However, the ad fraud attempts are becoming more sophisticated and traditional countermeasures are inadequate today.

An AI-based approach

As ad fraud attempts become more sophisticated and difficult to detect, so must our fraud detection mechanisms evolve in tandem and the only way that this can be achieved is using artificial intelligence (AI).

An AI-based ad fraud detection system actually starts with a rule-based approach as the base but through self-learning, builds layers of defence that learn from each suspicious activity that it detects. An AI-based model also has the advantage of being able to view patterns on many more dimensions than a traditional system.Artificial Intelligence approach to fighting ad fraud

Traditional rule-based models typically analyzes activity on between one to three dimensions. An AI-based model analyzes over 80 dimensions at a time, enabling it to detect extremely sophisticated ad fraud patterns. With self-learning, AI-based models can evolve as ad fraud patterns evolve to evade traditional systems.

A Real World Study

To demonstrate the advantages of an AI-based approach, Appier examined data on its own network over four months from May to August this year involving over 4 billion campaign data points including ad clicks and app installs. What we found was that the AI-based fraud detection model was able to identify twice as many fraudulent transactions as the traditional rule-based model. The AI-based model also proved to be more cost-efficient for advertisers, yielding a 3.6 percent higher return on advertising spend (ROAS) than the traditional model.

The greatest advantage of AI though, was its ability to detect sophisticated ad fraud patterns not previously reported. On pattern that our AI system flagged is what we call “the chameleon”.  This is where dishonest publishers disguise themselves as legitimate publishers at first, only to generate fraudulent installs at a later date.

Another suspicious activity detected by our AI is what we have termed “inventory burst”. With this pattern, a fraudulent publisher will generate an abnormally high inventory count in the absence of an appropriate level of in-app registration activity.

Final Word

You can download the full report of Appier’s study here. Ad fraud is costing the industry billions of dollars and has become extremely difficult to detect. Traditional rule-based methods are limited in their ability to detect new and increasingly sophisticated ad fraud patterns. AN AI-based approach with its ability to analyze multidimensional data and with self-learning is a better approach to fighting ad fraud.

About the author:

Joe Su, CTO, AppierJoe Su is CTO and co-founder of Appier.  Su has been hacking and building systems since high school, where he won first prize in the 3rd Annual National Center for High-Powered Computing Programming Contest Taiwan. Since then he’s been involved in system design and development in a variety of areas, including social games, VoIP, distributed computing and online geographical information. Prior to founding Appier, Su co-founded and ran Plaxie, an independent game studio focused on developing intelligent mobile and social games. Previously, he joined Artdio Technology as a programmer and served as a researcher in Computer and Communications Research Laboratories (CCL) of Industrial Technology Research Institute (ITRI), a leading high-tech R&D institution in Taiwan.