Protecting Budgets and Growing Subscribers: Gaining a Competitive Edge with Refocused Fraud Prevention

Telecom service providers have thrived in the digital era, with modern technologies such as 5G, artificial intelligence, and edge computing receiving huge investments. With these innovations, telcos have become well-aware of the evolving vulnerabilities and consequences presented by voice fraud and have allocated substantial time and resources to the often-challenging fight against it.

However, a different type of fraud is also well embedded in the industry, but with little to no awareness of its presence. Ad fraud and invalid traffic could be costing your business millions each year, crippling your return on investment (ROI) and obstructing you from reaching genuine subscribers.

In a competitive industry, telcos are investing heavily into digital advertising to gain an edge, but these efforts are wasted if marketing impressions are attributed to invalid or fraudulent clicks. With a calculated approach to pay-per-click (PPC) advertising optimisation, telcos can hit key benchmarks in their subscriber growth and protect their advertising spend.

The Fundamentals of Invalid Traffic

Invalid traffic refers to any clicks or impressions that may artificially inflate an advertiser’s costs. It is generated by actions that provide no legitimate value to the advertiser and covers both fraudulent activities as well as accidental clicks. Traffic may be deemed invalid if it is a result of non-human traffic or abnormal user behaviour, or because the activity is designed to produce invalid traffic like bots, hosts and malware.

PPC advertising, where the advertisers pay the ad network each time the ad is clicked, is especially lucrative for fraudsters. The more frequently the ad is spammed with invalid clicks, the greater the fee for the telco, and the bigger the payday for the fraudster.

Invalid and fraudulent advertising traffic compromises campaign data, misleading businesses into funnelling resources into traffic sources that appear lucrative but are in fact futile. This amounts to huge losses in media spend that could, and should, be reinvested into engaging new subscribers.

The Barriers ForTelcos

For telcos, addressing invalid traffic may seem daunting and complex, especially when compared to the traditional voice fraud they are already combating. However, the level of loss and impact ad fraud exposes telcos to is too consequential to ignore.

Telcos must prioritise gaining visibility into click traffic and understanding where the true value is. Otherwise, your marketing metrics will not display an accurate representation of PPC campaign results. Data-driven marketing is only valuable if an organisation is engaging real targets and capturing clean data with its digital strategies.

Telecom service providers could save a huge proportion of their digital ad spend, not to mention the increase in potential subscribers and ability to nurture current customers with that ad spend. However, fraudsters are taking advantage of telcos' lack of experience in this domain, and with the threat landscape becoming vaster and increasingly sophisticated, telcos must understand, detect, and mitigate fraud before it infests revenue streams. 

Fraud Prevention in Action

Service providers tend to be more concerned about revenue leakage in their network operations than their marketing campaigns, even though losses hurt subscriber numbers, margins and is actually easier to address. Advertising teams that are currently paying for incorrect attributions are taking losses from cash flow to lead generation and can put a stop to it by taking a proactive approach.

And they don’t have to do it alone. Ad verification and fraud prevention software-as-a-service (SaaS) platforms take the complexity out of understanding and acting on ad fraud and deliver you savings that significantly outweigh the initial cost of the platform, as well as increasing the subscribers converted from your advertising efforts.

It’s already working for telcos that are engaged with SaaS platforms. When audited, Asia’s leading MNO found that 11’311 clicks were invalid of the total 48’898, equating to 23.2% of its invalid click rate. Overall, $4’878SGD (14.6%) of the total Google Ads budget was lost to invalid clicks.

With invalid traffic prevention, the MNO saw a 23.3% increase in conversion rate, based on replacing budget spent on invalid clicks. The opportunity exists and is very real for telcos looking to make savings.

A Solution Worth Investing In

Put simply, you can make better advertising decisions based on verified traffic data. Budget can be re-directed to better traffic with a higher propensity to convert and you can maximise the return on your ad spend with ease. In an industry that values the number of subscribers, taking action to increase the conversion rate directly is critical.

The competitive advantage associated with mitigating invalid traffic is undeniable, and with the guidance and processes to combat it fixed service providers, mobile service operators, mobile virtual network operators and integrated fixed and mobile service providers can maximise the value of advertising spend and ensure every penny counts.