Latest Apsalar Data on In-App Click and IAP Fraud

07/15/15

eMarketer today published a summary of a recent study we conducted regarding in-app fraud as it related to two kep app APIs: click to install and in-app purchases (IAPs). You can download and read it for yourself, but the eMarketer summary included a couple of telling charts:

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Fraud matters. A lot. It is a criminal act that robs publishers and developers and brands of money that should earn for producing great apps and content.

We focused on two key fraud measures. Let’s talk about the significance of each one.

Click-to-Download Fraud

This describes an artificial inflation of the number of clicks required to get someone to download an app. It’s so significant because much app acquisition media is purchased CPC, meaning that brands are being robbed of dollars that should be supporting their growth.

IAP Fraud

Here it’s even easier to see the cost of fraud. We compare the number of revenue transfers to the number of reported transfers of virtual goods, to reveal the amount of items that are being stolen via hacks and other nefarious activities. Perhaps the most surprising thing here is that there isn’t more of an uproar among the app publishing community over this. In fact, some suggest it really isn’t an issue because people who acquire virtual assets illegally wouldn’t have been payers anyway.

Dunno exactly what to say about that sort of thinking. Yes, virtual goods have a marginal cost of virtually nothing, but to use cost as a proxy for value seems mistaken in this case. To say nothing of the impact of stolen virtual goods in multiplayer games, where fraudsters potentially gain a tremendous advantage if they have virtually unlimited access to game assets.

Fraud Awareness and Prevention

So, if fraud is important to you, you need to have information on how it is affecting your business. That’s only possible through 3rd-party measurement. Here are five tips to consider.

  1. Don’t fly blind. Deploy a robust app measurement solution that can gauge the true effectiveness of your partners and identify “bad actors.”
  2. Ensure that your measurement solution can deliver value for your industry/category.
  3. Measure everything that matters. Identify all of the customer events throughout the buying funnel that are important to your business, and
    implement measurement plans for each.
  4. Don’t trust surrogate metrics like CPI or CPC to be good predictors of registrations, purchase occasions, revenue and lifetime value.
  5. Use mobile app data as the foundation for cross-device profiles and audiences that can help improve your marketing effectiveness.

The Apsalar team can help take you through how  to use data to identify issues and educe the amount of fraud that impacts your business.

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