The mobile gaming industry is facing two critical challenges that most developers are ignoring: fraud is eating away at marketing budgets, and user retention rates continue to plummet after initial rewards end.
22% of all digital advertising spend in 2023 was lost to fraud (totaling $84 billion globally), while average Day-7 retention rates for mobile games sit at just 8.7%, meaning fewer than 1 in 10 users stick around after the first week.
These aren’t abstract problems, they’re hitting game studios’ bottom lines every day.
That’s exactly what was discussed when TyrAds CEO Zino Rost van Tonningen sat down with Matej Lanceric on the Two and a Half Gamers podcast during MAU Vegas.
Two and a Half Gamers is one of the mobile gaming industry’s most respected podcasts, known for diving deep into the technical challenges that UA managers actually face.
Host Matej Lanceric doesn’t shy away from the uncomfortable topics that most industry content avoids.
Industry-Wide Fraud Problem Getting Worse
Mobile ad fraud isn’t just a minor cost of doing business anymore.
Mobile app marketers lost nearly $35 billion globally in 2023 due to fraud, with rewarded advertising particularly vulnerable due to its incentive-based structure.
The “Video Gaming” category alone recorded a 21% Invalid Traffic rate in Q3 2024, resulting in over $690 million in wasted ad spend in just three months.
During the podcast, Zino revealed something most developers don’t realize: “We’ve seen clients lose $20,000 in under ten minutes” from basic fraud attacks that could have been prevented.
The root of the problem? Most developers are unknowingly making themselves targets.
When apps send tracking events directly from user devices to Mobile Measurement Partners, those events can be manipulated.
Fraudsters use everything from modified APKs to cheat engines to fake user progression and claim rewards they never earned.
Zino’s approach is straightforward: implement server-to-server tracking where your backend handles event reporting.
“There’s no way users can fake that, they can’t access your database,” he explained.
For developers without backend infrastructure, the immediate fix is upgrading MMP security:
- Adjust users need Signature V5
- AppsFlyer and Singular users should enable signature systems
- Everyone should stop using outdated, vulnerable SDKs
The Retention Crisis No One Talks About
Here’s the bigger issue: even when fraud is eliminated, most rewarded users disappear after collecting their rewards.
Zino put it simply: “Rewarded users are like party guests. When the drinks run out, everybody disappears.”
This isn’t a TyrAds problem, it’s an industry-wide challenge.
While hyper-casual games see Day-7 retention rates as low as 5.9%, even better-performing genres like match games only achieve 13.98% retention after one week.
The platforms that survive will be those building real technology to predict churn and automatically re-engage users.
TyrAds’ v3 SDK uses machine learning to identify when users are about to drop off, then triggers targeted re-engagement campaigns.
“We give them an extra drink at that moment, just to get them to reactivate,” Zino explained.
But most platforms aren’t there yet.
According to Zino’s prediction, if rewarded advertising partners don’t solve long-term progression in the next six months, “they won’t exist by next year.”
Only 3-4 major platforms will dominate the space, those who’ve built real retention technology instead of just marketing promises.
Why This Matters Right Now
These problems are accelerating.
Non-optimized campaigns saw fraud rates increase by 19% year-over-year in 2024, reaching a four-year high of 10.9%, while campaigns with active fraud protection saw rates drop by 9.8% to just 0.7%.
Meanwhile, the average mobile game sees user retention plummet from 30% on Day 1 to just 3% by Day 30, a massive “leaky bucket” problem that makes user acquisition investments unsustainable.
If your campaigns aren’t protected against fraud, you’re burning money. If your platform can’t keep users engaged long-term, you’re paying for expensive one-time interactions instead of building valuable user bases.
The consolidation is already happening.
Ad tech M&A activity surged in 2024 with over 100 deals recorded in Q3 alone, while major players like Oracle completely exited their $2 billion advertising business due to declining profitability.
Watch the Full Discussion
The complete conversation covers the technical details behind these industry challenges, plus advanced strategies for iOS campaigns, scaling techniques, and predictions for what’s coming next.
🎥 Full podcast: Two and a Half Gamers – TyrAds CEO Episode
Key topics in the full interview:
- Specific fraud prevention techniques used by industry veterans
- Advanced retention strategies that actually work
- Why iOS users behave differently in rewarded campaigns
- Tactical advice for scaling campaigns without burning budgets
- Behind-the-scenes insights from someone who’s infiltrated fraud groups
Whether you’re just starting with rewarded UA or looking to optimize existing campaigns, this conversation provides actionable insights you won’t find anywhere else.
The mobile gaming industry is changing fast. Make sure you’re keeping up with what actually works.
