Who's Really Driving Mobile Ad Fraud?

COMMENTARY

• by Omri Halamish , Columnist, 5 hours ago

This year, advertisers are projected to lose $16.4 billion in fraudulent spend, making mobile ad fraud one of the most critical issues plaguing the industry today.

Although we’d assume that advertisers would do everything in their power to fight fraud so that their campaigns remain impactful, this unfortunately isn’t always the case.

Setting the scene: attribution manipulation today

The mobile ad industry today relies on attribution companies to determine which network or ad source gets the credit for an install. But mobile attribution today is far from perfect, and fraudulent publishers exploit loopholes to misattribute organic installs as paid ones. This means advertisers will pay them for installs they didn’t actually drive — we call this “organic poaching.”

Generally, the industry uses a last-click attribution model, and this window typically lasts seven days so, for example, if a user sees multiple ads for the same app, each served by a different network, clicks on one of them, and finally downloads the app four days later, the last ad he clicked on would get compensated for the install.

This model is problematic because it has led to a rise in attribution manipulation fraud such as click-stuffing, in which publishers generate clicks for ads that were only ever viewed, or even ads that were never viewed.

Facebook and Google effectively solved this by leveraging their market share to become a self-attributing network, performing attribution on their own traffic. But while this lets them more easily block instances of attribution manipulation, it leaves the rest of the industry's ad networks, which don’t have the same clout, to deal with a problematic reality.

Turning a blind eye

In addition to the lost budgets, the prevalence of attribution manipulation also makes it more difficult for advertisers to measure campaign efficiency and ROI.

So why do we see advertisers — or more specifically, the user acquisition managers in charge of ad spend — actually ignore, if not inadvertently encourage, this type of fraud?

Because many user acquisition (UA) managers care about one thing: Return On Ad Spend (ROAS). They get rewarded when ROAS is high, because that’s how UA managers are measured. So if organic installs that are misattributed as paid positively impact ROAS, what’s the harm in letting it slide? They have an incentive to “acquire” as many users as they can within that seven-day attribution window, whether the users really installed because of a mobile ad or because they saw a great commercial on TV. This is what drives up ROAS.

The thinking is that the misattributed install will be cheap and significantly lower than what they would usually pay, which in turn will lower the average cost per user. This not only makes it seem like they were able to reduce overall ad spend, but that they reduced it without compromising on quality. After all, in reality the user is likely organic, and organic users generally have higher lifetime values than paid users.

Key takeaways

First, it might sound like a good deal to pay $1 for an install that a bad actor “snipes” from a network that would otherwise charge you $15. But know that it’s all a cost-per-thousand game, and by doing so, you’re inflating your rates with legitimate sources and networks. The fewer installs you attribute to a legitimate network, the more you’ll need to pay per single install down the line.

Second, you're paying for organic installs. Stop wasting your money, it will never be worth paying for organics.

Finally, you are the first and last line of defense for showing executives why your app is worth money. Executives want to see a scalable (UA) model that’s profitable, because that’s what demonstrates overall business health. Inflating these numbers risks taking everything down.

Exclusive: Apollo approaches TV stations owner Nexstar about acquisition - sources

The Thomson Reuters Trust Principles.

Pamela Barbaglia, Greg Roumeliotis

3 MIN READ

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·        (Reuters) - Buyout firm Apollo Global Management LLC (APO.N) has approached Nexstar Media Group Inc (NXST.O), an operator of television stations that reach nearly 40 percent of U.S. households, to express interest in acquiring it, according to people familiar with the matter.

The approach comes a year after Nexstar’s $2.3 billion acquisition of peer Media General Inc turned it into one of the largest U.S. broadcasters. Nexstar wants to add scale as advertisers move their spending to digital and mobile platforms.

Apollo has teamed up with P2 Capital Partners LLC, another investment firm that already owns a small stake in Nexstar, the sources said this week. Nexstar has not yet engaged in sale talks and there is no certainty it will entertain an offer, the sources added.

The sources asked not to be identified because the deliberations are confidential. Apollo declined to comment while Nexstar and P2 did not immediately respond to requests for comment.

The possibility of a deal sparked a 15 percent jump in Nexstar shares. They later eased to trade up 5 percent at $81.95, giving the company a market capitalization of $3.8 billion.

Based in Irving, Texas, Nexstar has a portfolio of 169 TV stations reaching 100 regional advertising markets that are affiliated with NBC, CBS, ABC, FOX, MyNetworkTV and The CW.

Nextstar generated adjusting earnings of $743 million last year, up 83 percent year on year, and $469 million in free cash flow, making it an attractive asset for private equity buyers.

Nexstar made an offer for peer Tribune Media Co (TRCO.N) last year, but lost out to Sinclair Broadcast group (SBGI.O), which clinched a deal for $3.9 billion.

Nexstar is nominally at the limit of a cap by the U.S. Federal Communications Commission (FCC), which restricts TV station ownership to no more than 39 percent of U.S. television households.

However, the FCC is considering rescinding the rule, though it has yet to vote on the matter. Last year, it also changed the rules in which TV stations are counted toward that cap. The change paved the way for Sinclair, the largest U.S. television broadcast group with 192 stations, to ink a deal for Tribune.

Sinclair and Tribune are still waiting for the FCC to clear their deal. Sinclair said in April it would divest 23 stations to win approval.

P2 Capital has a history of buying small stakes in publicly listed companies and then seeking to partner with private equity firms to acquire them. Earlier this year, it teamed up with buyout firm Silver Lake to take U.S. financial technology company Blackhawk Network Holdings Inc private for $3.5 billion.

Reporting by Pamela Barbaglia in London and Greg Roumeliotis in New York; Additional reporting by Liana B. Baker in New York; Editing by Jeffrey Benkoe

 

 

Study: AM/FM Radio Could Attract Light TV Viewers

• by Wayne Friedman , July 6, 2018

Traditional radio believes it can give TV advertisers better access to light TV viewers -- with higher campaign lift -- by allocating some of their media dollars to radio.

In its first Nielsen cross-media study, analyzing TV and AM/FM radio, network radio company Westwood One says that while light and non-TV viewers represent a large percentage of the TV audience, they represent only a small percentage of TV time spent and commercial impressions.

The study says that while light and non-TV viewers -- 18-49 -- represent 44% of the U.S, they only comprise 9% of total TV impressions.

With AM/FM radio reaches 90% of light viewers, a media buy on radio would make overall TV advertising plans more effective.  

Pierre Bouvard, Chief Insights Officer of Westwood One, tells Television News Daily: “Per Nielsen’s CommsPoint media-planning software, you can expect a 40% lift in campaign reach by allocating 20% of the TV budget to AM/FM radio.”

Light TV viewers run across all demographic groups, including young viewers: 44% of those 12-17 represent only 9% of total TV commercial impressions; with AM/FM radio reaching 88% of this demographic; and 45% of persons 18-34 viewers represent only 7% of total TV commercial impressions, with radio reaching 89%.

Among older TV viewers, 44% of those 25-54 comprise only 10% of TV commercial impressions -- with radio reaching 92% of this audience -- and 41% of those 55 years and older totaling 17% of TV commercial impressions. Radio reaches 93% of this group.

The research says that among Nielsen-defined heavy TV users, those 18-49 are 17% of the U.S. and represent half of all TV impressions.

The study used a Nielsen 80,000-person Portable People Meter panel measuring TV and AM/FM radio audiences, which looked at TV time spent among heavy TV viewers, as well as light and non-TV viewers.

Millennials Favor Netflix, OTT, Not Demo-Targeted Services

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COMMENTARY

• by Wayne Friedman , Staff Writer, July 6, 2018

Looking for the next MTV in the new digital video world? Digital video for young millennials could be YouTube, or other easy-to-access, ad-supported digital video platforms.

Apparently, that is not totally the case.

According to one survey, Netflix is the choice place for video for millennials. (And it's also a choice for older TV viewers as well.)

This isn’t the mid-1990s. Perhaps audience segmentation into different networks -- or separately branded, over-the-top digital video platforms  -- is an old thing.

A survey of 2,500 people from Cowen & Co., an investment management company, says that almost 40% of respondents, ages 18-24, used Netflix most often to view video content. YouTube was next at 17%; basic ad-supported cable around 13% (Hello, MTV!); Hulu, 7.6%; and broadcast TV, 7.5%.

Those surveyed answering this question: “Which platforms do you use most often to view video content on TV?”

Looking at all respondents, Netflix was still on top at 27%. Basic cable was next at 20%, followed by broadcast at 18%; and YouTube at 11%.

Cowen’s results may not mean much to TV analysts. Longtime TV research data -- especially data from Nielsen -- would point to many individual broadcast networks taking top positions.

Still, some of this data may suggest how young millennials respond to specific media and video brands -- especially those looking to target them.

Remember FullScreen? It was a new OTT that specifically targeted young Netflix-leaning viewers. The joint venture between AT&T and the Chernin Group -- launched in the spring of 2016 -- closed down barely a year and half later, in November 2017.

FullScreen tried to attack its rival on price. Where Netflix charges round $11 to $12 per month. FullScreen charged at $4.99/month.

NBCUniversal's Seeso -- a comedy-based OTT with NBC “Saturday Night Live” and other young-comedy content -- also made a push. It started in January 2016 and closed in November 2017. It also was modestly priced.

So what is the secret? Netflix doesn’t specifically target young viewers; and neither does YouTube or Hulu.

Maybe the best big video OTT brands have under-the-radar, audience-segmented strategies. Of course, many would say that all digital media is primarily for young millennials these days. That could be the real answer.

Adding Radio Equals Success

 

July 8, 2018

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Thanks to Megan Black from Second Street and Tucker Young from Bryan Broadcasting for sharing our latest advertiser success story. “Mathnasium, The Math Learning Center” needed a little jolt of success to drive more customers to its College Station, TX, franchise. Young, the Operations Manager at KPWJ-FM, and Second Street came up with a killer idea that not only netted the station a $3,000 sale but also had the client hootin’ and hollerin’ with happiness.

Radio Ink: Tell us how this idea came together. 
Tucker Young: This idea came together out of necessity. The local Mathnasium franchise (which is a tutoring business) had run spots for a few years and had seen the results start to stale. We knew we needed to get a fresh strategy to help them cut through. They’re very digitally savvy and had been building some Web tools themselves that had seen some results so we decided to put together a digital engagement campaign and pair it with a revamp of their on-air spots.”

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Radio Ink: Tell us specifically what the idea/promotion was. 
Tucker Young: The concept was to find a way to impress on parents that they probably didn’t know as much about elementary math as they thought. This was pretty easy to do! We put together a series of math quizzes from 3rd to 5th grade curriculums and used taking the quiz as an entry point for a sweepstakes giveaway of a semester of tutoring at Mathnasium. The parents predictably didn’t do as well as they thought and therefore the idea of getting a tutor looked a lot better by the end of the quiz. We also integrated an opt-in that allowed a parent to get a call back from Mathnasium staff directly to talk pricing if they wanted.

Radio Ink: Why would you say it worked for both the radio station and the client? 
Tucker Young: For the radio station it was great! Peace 107 is a Contemporary Christian station that focuses a lot on family, so a prize like tutoring or tuition is something that plays extremely well. For the client, it introduced their product to the audience in a fun way that really got people’s attention. The digital element allowed us to provide them with a list of quantifiable leads of top-tier prospects that they could work with and changing their spots to a client testimonial with parents and kids helped them tell their story better by showing their successes working with kids who needed a little help in math.

Radio Ink: As the Ops Manager, why did you like it? 
Tucker Young: Digital promotions scale so well as opposed to a lot of what radio has done in the past. This took some time to brainstorm creative, build out the elements, but after that it was just the bread and butter of promoting the contest to the listeners…even that is easier though since we used a pretty robust email strategy to get it in front of the interested parents in the audience.

Radio Ink: How do you know the client got results? 
Tucker Young: This is my favorite part of these types of campaigns. We know they got results because we have a database of all the listeners that took the quiz, expressed interest in learning more, joined Mathnasium’s email database, and even those that wanted a phone call to talk pricing. Deliverables like that didn’t exist prior to integrating digital with broadcast. Outside of that, they ended up buying similar campaigns on three occasions after that on two of our stations. They loved the results.

Radio Ink: Did you get feedback from the client? 
Tucker Young: I remember them being skeptical at first but after the ads started airing and the quizzes started taking off they were thrilled! The testimonial spots even caught the eye of their corporate HQ who commended them on their strategy and started looking at implementing it in other markets.

Radio Ink: How was it received by the listeners? 
Tucker Young: Listeners really enjoyed it. I think people are primed to take quizzes online now with the rise of Buzzfeed and others. They’re just fun, and the best part of it is it allows us to tell the story of a client in a new way where the listener is taking an active part in discovering it. One thing that radio has always valued is new ways to engage with listeners, the online world has given us so many new ways to do that and it’s very exciting.

Teens Embrace Activism, Cause Marketing

 

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RESEARCH

• by Tanya Gazdik  @TanyaGazdik, Today

A majority of teens (69%) say they trust a company more after learning it supports a social cause and 62% are more likely to purchase its products.

That’s according to a recent study of 2,000 teens between the ages of 14 and 17 conducted by Vermont-based Fuse. The aim is to give additional insights for brands as they consider their cause marketing programs. 

Sixty-six percent of teens said they pay more attention to the company’s overall marketing and advertising if they know the company supports a social cause. But teens are discriminating, if not skeptical. Fifty percent say they believe a company’s cause marketing is genuine if it makes a financial donation to a cause, and 50% of teens say they believe a company’s cause marketing is genuine if its employees work on the issue. A smaller number — 44% — say they believe a company’s cause marketing is genuine if the company communicates about its efforts in its marketing/advertising. 

Teens believe that corporations have the same obligation as teens themselves to help solve social issues, with 68% saying companies have an obligation to solve social problems, while 67% say they themselves have that responsibility. Only 10% say neither they, nor corporations, have an obligation to solve social problems. And how do teens think companies are doing? Not so well. Only 28% of teens think companies are doing enough to support causes teens care about.

Fuse conducted a similar study in 2016 and found that the brands whose cause marketing efforts most resonated with Gen Z included Ben and Jerry’s, Chili’s, and the NFL. The 2018 study includes three new companies getting the attention of teens: Walmart’s partnership with Feeding America, McDonald’sHACER Scholarships and the Ronald McDonald House and Microsoft’s K-12 STEM programs.

The environment is back on the list of key concern areas after disappearing in the 2016 study. The top five key concerns of teens are education, jobs and unemployment, prejudice and racism, the environment and terrorism.

Another notable change since 2016 has been in teens’ more assertive activism. More than a quarter of respondents say they have “attended protests or rallies” or “boycotted a company” in the last year. Teens also engaged in other ways, with 60% recycling regularly, 42% educating family and friends about a cause, 33% volunteering their time to a cause and 22% donating money to a cause.

In What Do We Trust?

COMMENTARY

• by Robert Passikoff , Op-Ed Contributor, Yesterday

In the latter end of the 20th century, a significant shift in how consumers viewed categories, compared brands, and purchased products and services occurred. The shift related to a change in the values -- the belief systems, character, and ethos associated with brands -- consumers used as a tacit, right-brained “yardstick” to determine whether a brand measured up to what they expected.

Customer Satisfaction, Total Quality, and ISO 9000 programs of the late 20th century pretty much guaranteed that companies that survived to compete in today’s marketplace were going to be turning out products and services mostly “right” and pretty much the same.

As the age of brand ubiquity arrived, the consumer decision process shifted from relying on rational values to engage consumers and drive behavior to more emotional values. Today, on average it is estimated the emotional-to-rational decision-process ratio is 70:30, in some categories as high as 80:20, which means that depending upon the category in which you compete, emotional values outweigh rational value by more than two, three, or four to one. You can quibble about the precise ratio in your category, but unless you are selling commodities, rational factors are not going to move audiences or products the way they did 30 years ago.

For marketers, the difficulty, of course, is identifying the right, emotional values to leverage. You can’t just ask consumers about them because either they can’t articulate them or, more often, they don’t want to articulate them. Emotional values are, after all, personal, affective, sensitive, and sometimes spontaneous. To compound the problem, different categories or sectors have different values that engage and drive consumers. Every category is different with different emotional values that drive consumers, with one exception.

“Trust” is universal to them all. (So is “value,” as in “price-value,” but that falls on the rational side of the decision process.) “Trust,” to one degree or another, is part of every category’s consumer decision process. The question is, how much does “trust” contribute to audience engagement?

To answer that question, Brand Keys relies on assessments based on a validated, psychological questionnaire (test-re-test reliability of 0.93, with results that are generalizable at the 95% confidence level). The higher-order statistical analyses identifies the percent-contribution each category attribute, benefit, and value makes to engagement and consumer behavior. Those assessments correlate very highly (0.80+) with positive behavior toward a brand, sales, and profitability.

Drawing from our 2018 Customer Loyalty and Engagement Index, we examined over 150 categories and 1,287 brands to determine how much “trust” contributed to brand success. These are the top 10 categories where “trust” makes the largest contribution to consumer engagement:

1. Media (34%)
2. Social Networking (28%)
3. Computers (26%)
4. Insurance (25%)
5. On-line Payment Services (22%)
6. Quick-Serve Restaurants (21%)
7. Smartphones (19%)
8. Banks (18%)
9. Natural Food Stores (16%)
10. Pet Foods 15%)

The analysis revealed interesting category segmentation based on “trust” as a driver of consumer behavior. Of the top ten categories, three were loosely related to “technology,” three had to do with “financials,” and three had to do with “food/nourishment.”

“Media” stood on its own at the top of the list, with a  “trust” percent-contribution significantly higher (+5%) than any other category, which is why Brand Keys is going to track -- and report on a bi-monthly basis -- trust levels for key media brands for MediaPost.

Currently Brand Keys tracks 50 media brands including Fox News, The Washington Post, The New York Times, The Drudge Report, Politico, CNN, MSNBC, The Wall Street Journal, Breitbart News Network, Disney, and the Weather Channel.

When it comes to the media, “trust” is something that readers and viewers seem to know when they feel it, and then act upon it -- pretty much the definition of how consumers react to an emotional value. But a deeper-dive, psychologically speaking, permits us to identify the foundations of media-trust, which include the following elements (presented alphabetically, since they all fuse to create “ media trust”):

* Accurate

* Balanced/Fair

* Candid/Truthful

* Clear

* Competent

* Ethical

* Familiar

* Having Integrity

* Investigative

* Qualified

* Skilled

* Social conscience

So in the spirit of William Shakespeare’s admonition in "All’s Well That Ends Well," to “Love all, trust few, do wrong to none,” this study will identify what trust levels various media is able to generate among its readers and viewers.

Because, after all, trust is what media is all about.