Mobile app and ad fraud remains a persistent problem for marketers as 22.6% of non-organic app installs are now considered fraudulent.
According to AppFlyer’s latest State of Mobile Fraud report, $2.3 billion in ad expenditure was exposed to app install fraud during the first six months of 2019.
Based on an analysis of 2.5 billion non-organic app installs across 9,500 apps, the marketing company also found that 2.1% of in-app purchases were fraudulent in Q2 2019 marking a 10x rise over Q1.
Reshef Mann, the co-founder and CTO of AppsFlyer, explained that the industry seemed to be successful by launching new solutions to detect bots back in 2018.
“But in April 2019, the wave surged again as app install fraud evolved from device farms with physical devices to device emulators and other sophisticated bots and schemes capable of unlimited scale. The speed at which fraudsters adapt is also accelerating, from one to two months in 2018 to as little as two to three days today,” he said.
The study found that one in four apps have a fraud problem that exceeds 20%, posing a serious risk to advertisers and users. Apps with higher numbers of installs tend to have a larger fraud problem (up to 30%) compared to smaller apps (8%).
Among the most affected app sectors were finance apps where a whopping $750 million in ad spending is exposed to app install fraud. Vietnam, Indonesia and India were the most affected countries with Germany, the UK and Spain also heavily targeted.
Travel apps were also hit hard, whilst gaming apps tend to be more highly affected by sophisticated in-app fraud, including purchase fraud.
Apple iOS proved less vulnerable than Android where fraud is 6x higher. This is likely due to Apple’s tight vetting rules for new apps.
On Android, 80% of fraudulent installs were attributed to bots, whilst 85% of bad installs on iOS were due to click flooding.
Mann added that addressing and fighting ad fraud requires “constant attention, innovation and the ability to crunch massive data sets across machine learning algorithms.”
In parallel to the report launch, AppsFlyer revealed a new Post-Attribution tool which scans for fraud after app installs have been attributed.
“[W]hen fraud manages to get past this real-time defense, you need a solution for enabling reconciliation. This is an important step forward in combating app install fraud and we take our responsibility seriously so that bad actors continue to be thwarted when trying to evade defenses. We estimate our new Post-Attribution protection layer will potentially save advertisers additional millions per day in wasted ad spend,” Mann added.