By Greg Shepard, CTO, Pepperjam.
Performance marketing-related ad spend now represents almost half of all digital ad spend.
Affiliate marketing ad spend represents $4.8 billion or 7.5% of total digital ad spend. In 2016, one half of all US retail sales were impacted by performance marketing, which includes affiliate marketing, search, classifieds, app install ads and email. Within this, mobile alone affected 37% or $1.4 trillion of in-store sales in 2016. That's up 32% from 2015.
Clearly, the "year of mobile" has happened and retailers can now deploy marketing elements like site-to-store, micro-moment, beacons, location-based ad networks and more to attract customers on the move. Perhaps the most active area in the mobile space is apps. According to Yahoo's Flurry Mobile Analytics, 90% of the time people spend with mobile devices is spent using a mobile app.
Because of rapid consumer adoption of mobile and mobile apps to accomplish every last little thing in their daily lives, retail marketers have taken note and are increasingly allocating time and budget to mobile app integrations, advertising and their own app development. However, as with many things in the online world, the rapid adoption of mobile app usage has led to a degree of fraud.
Made popular in the Watergate film All the President's Men, the term "follow the money" should give retailers a clue at how to detect mobile advertising fraud. That's because, as marketing budgets move to mobile, so do fraudsters following the money. As a result, brands with mobile apps can be duped into paying for fake installs.
In acknowledging the "follow the money" problem, a smart retail marketing team will understand that when it comes to examining install metrics, the red flag to watch for is the time between a user click and the install event. If the time to install is not close to the click event or in keeping with typical user behavior, fraudulent traffic sources may be involved.
For a marketer interested in putting a stop to fraudulent traffic from being attributed to paid channels, the marketer could chase after each and every install event and analyse it for abnormalities in real-time. However, this approach is costly both in terms of time and money and, as well, isn't completely foolproof since both marketers and networks may be unable to properly pinpoint appropriate attribution windows because the numbers vary from app to app.
A better way? Instead of spending resources on a problematic fix, it's more practical to bypass fraudulent traffic entirely by employing preventative tactics. While there are certainly several ways to avoid mobile app install fraud, our partnership with Optytic helps advertisers connect affiliate programs with their mobile app customer acquisition marketing plans.
This solution provides app-to-app tracking allowing for the tracking of all app-to-app orders and installs which can then be viewed within our network, CPI and CPA media buying for app only display campaigns, in-app SDKs that provide app activity to the network and monitoring which helps prevent advertisers from falling into less desirable apps.
And then, of course, there's the proper way to financially ensure things don't go down the wrong path. A good rule to follow is to compensate media partners only on performance and engagement of the new users they drive. Simply put, when you pay out a commission revenue share based on how much a user spends in your app, opposed to paying a media partner to drive an install, you follow the money of your customers not fraudsters.
Rapid mobile adoption has quickly and dramatically changed the retail landscape. Mobile app adoption and usage has skyrocketed. Advertisers have followed and so have fraudsters. Implementing proper techniques to quell mobile app install fraud is paramount to the success of any mobile-centric marketing effort.