We classify mobile ad fraud into three categories. We previously looked at Phantom Installs and Junk Installs, and now we focus on Organic Poaching.
Organic Poaching covers any form of fraud where an advertiser steals credit for an install that would have happened anyway. We distinguish Organic Poaching from other forms of ad fraud where no install actually occurs, such as Junk Installs and Phantom Installs.
Organic poaching is perfect for fraudsters who want to take advantage of the growing emphasis on performance marketing. Advertisers nowadays are obsessed with finding channels that deliver good performance, but most other forms of fraud deliver users with very poor lifetime value (LTV).
Organic poaching, however, delivers users whose LTV exactly matches that of their organic users. Poached users look to be high quality, so advertisers often mistakenly trust these channels and throw money in their direction. However, every time their traffic increases, organic traffic decreases by the same amount. Conversely, when the channels are shut off, organic traffic increases correspondingly. In both cases, the total install volume remains the same, the only difference is whether you pay for these users or not.
Types of Organic Poaching
We’ve identified many kinds of organic poaching, including fingerprinting fraud, click injection, and click spamming. Each of these methods has its own peculiarities worth exploring, so we are creating multiple posts exploring each subject. Our series will include posts on these subjects:
Case Study: Misaligned Company Incentives
Kelly was the CMO of a fast-growing mobile app that recently raised a Series B round. The app was interested in moving beyond organic traffic and using their funding for paid user acquisition. Kelly hired Gene as a Director of Growth, whose job was to manage paid growth channels. Gene had a budget for paid user acquisition, and his key metric was to increase traffic from channels meeting minimum quality thresholds.
Gene’s efforts appeared quite successful at first. He used up their entire budget on channels that performed as well as their organic users. Kelly approved increasing budgets for Gene each month. After a few months of strong growth, however, Kelly was frustrated to find overall growth was not accelerating. She suspected fraud and used DoubleCheck to try to uncover what was happening.
When DoubleCheck reviewed these paid channels, they found that nearly all of the paid channels were committing some form of organic poaching. As a result, every time the paid traffic increased, the organic traffic decreased. Overall traffic remained the same, but they were having to pay for installs that were previously free. Kelly fired Gene and turned off all the paid channels, and found that total traffic remained the same.
We see this app started cannibalizing itself when it stated paying for its own users. Though Gene lost his job here, perhaps Kelly is also at fault for misaligning incentives. Growth managers like Gene will always endeavor to use and increase their budgets. If a competing department head was responsible for monitoring and increasing organic growth, they may have pushed back against Gene’s efforts. Yet few mobile apps are organized in such a manner, creating internal incentives that promote organic poaching.
Here are our takeaways for how leaders of mobile apps can protect themselves:
Closely monitor organic traffic rates for unexpected increases or decreases whenever you make major changes.
Consider establishing a department responsible for protecting organic traffic as an organizational counterweight to paid traffic departments.
Promote a strong company-wide culture against fraud, backed up by providing access to comprehensive anti-fraud tools.