Brief:

• India's mobile ad market is growing rapidly, but the country has the Asia-Pacific region's highest rate of app installations generated by bots at 17%, according to a study by marketing firm Tune cited by Bloomberg.
• Non-install fraud, such as fake clicks, dummy users or ads sent to non-targeted audiences is also prevalent, the study found. The fraud click rate in India is almost 32%, while uninstalls are also a major problem for developers that have spent millions of dollars to boost awareness around a mobile app.
• Meanwhile, mobile ad spending in India is set to climb 85% this year, followed by 75% growth in 2018 to $810 million, according to researcher eMarketer. The growth means that mobile media will account for more than half of all digital ad spend in the country.

Insight:

While mobile commerce is growing in India, a significant portion of cellular device users have inexpensive smartphones with limited memory and processing power to handle apps. Many users have to uninstall apps to save space, analytics provider AppFlyer told Bloomberg. Unfortunately, these high churn rates mean that developers need to keep promoting their apps to urge consumers to reinstall them, which also complicates the tracking of ad effectiveness. The strong presence of fraud in the region reflects similar issues that earning more attention in the U.S. this year. 

Digital ad fraud is recognized as a billion-dollar problem for marketers globally, as highlighted last year by the Russian 'Methbot' ring that used a network of websites to generate fake ad traffic. Mobile ad platforms are working to develop better fraud detection. For example, YouAppi rolled out a fraud protection suite in September as a standard feature of its 360 Degree Growth Marketing Platform. The company claimed its software tools help to protect against click injection, click spamming, non-human traffic and incentivized traffic.

Mobile tracking firm AppsFlyer introduced the Protect360 platform to help advertisers detect ad fraud early on. The firm's India sales director estimated that one kind of fraud, DeviceID reset fraud, cost advertisers $1.1 billion to $1.3 billion in the past year, Bloomberg said. DeviceID reset fraud involves creating a fake phone identification, installing an app and then enabling an ad network or other provider to collect a fee from an advertiser who pays for installations of apps, VentureBeat reported.

While ad fraud is a significant problem for the industry — particularly in India and Guatemala, the only country with higher ad fraud than India — marketing platforms are developing ways to detect scams and avoid wasting money. But for now, the future of how best to address these issues is yet to be seen.