Apple reportedly revamping iAd to rekindle interest

Posted:
in iPhone edited January 2014


Faced with diminishing interest in its iAd service, Apple has made substantial changes to the struggling advertising platform, such as reducing the minimum campaign amount, increasing developer revenue share and adjusting its fees, according to a new report.



Little more than a month after former Adobe executive Todd Teresi joined Apple to head up the iAd division, the company's advertising service is undergoing a drastic shakeup, AdAge claimed on Tuesday.



Advertisers can now reportedly spend as little as $100,000 to initiate mobile campaigns, down from a $300,000 threshold noted last July. The new minimum represents just a fraction of the lofty $1 million minimum when the service launched in 2010 and the $500,000 entry price from last February.



Apple is also said to have increased the developer cut of ad revenues to 70 percent, up from a previous 60 percent share. According to the report, the money will compensate app makers for "lower ad rates" and is an attempt to court more developers to monetize their apps through iAd.



The Cupertino, Calif., iPhone maker is believed to have done away with a fee system that charged advertisers twice for their ads. iAd has reportedly abandoned per-click fees and now only charges a fixed rate for every 1,000 ad impressions.











The report highlighted the revamp as the "biggest reset" for iAd since its inception. Apple made waves with iAd when it first arrived, attracting several big-name brands to run high-profile campaigns. However, the initial excitement surrounding the service has since faded considerably.



iAd's struggles have prompted some to begin ringing a death knell for it. Late last year, The Wall Street Journal called iAd a disaster, noting advertisers' response as "tepid." One IDC analyst told the publication that iAd would "fade into the background" over time.



Though Apple's share of the mobile advertising market declined from 2010 to 2011, it managed to hold onto a 15 percent share, behind only Google and Millennial Media, last year.





iAd market share in 2011.







iAd arose out of Apple's $275 million purchase of Quattro Wireless in late 2009. The company had previously been interested in acquiring AdMob, but Google snatched up the agency before Apple was able to finalize a deal.



Though Apple has been relatively quiet about iAd in recent months, it did revamp its iAd producer software last November, adding animation tools, page objects and code-editing improvements in an effort to drum up support for the service.



[ View article on AppleInsider ]

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Comments

  • SpamSandwichSpamSandwich Posts: 23,594member
    iAd will eventually find it's own level. It's ridiculous to think that Apple cannot make a decent go of it on their own self-contained advertising devices.
  • nagrommenagromme Posts: 2,834member
    Ad-supported apps are NOT my favorite model. But it?s an important option to have, and I?m not 100% opposed in every case.



    It?s probably a good idea for Apple to have their own service that no competitor (Google) can pull the plug on or exert control over. Devs will choose between various ad offerings, but I can see why Apple wants to have their toe in the water as well.
  • solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by SpamSandwich View Post


    iAd will eventually find it's own level. It's ridiculous to think that Apple cannot make a decent go of it on their own self-contained advertising devices.



    They certainly have plenty of time to sort it out but for a company with so few missteps this one is looking pretty big.
  • jragostajragosta Posts: 10,473member
    Quote:
    Originally Posted by AppleInsider View Post




    iAd market share in 2011.



    To me, this is the most interesting part of the entire article. While Google owns desktop advertising, mobile advertising is clearly anyone's game at this point. I would love to see it remain split like this, but if someone has to dominate, I hope it's anyone but Google.
  • macky the mackymacky the macky Posts: 4,572member
    It's just WRONG for any headline to include "Apple" and "kindle" in the same sentence.
  • a grain of salta grain of salt Posts: 68member
    I have had an iPad from about two months after they were first released and I have never seen the mythical iAd. I use ad supported software but only see google ads. Where do you find them?
  • nvidia2008nvidia2008 Posts: 9,262member
    Quote:
    Originally Posted by SpamSandwich View Post


    iAd will eventually find it's own level. It's ridiculous to think that Apple cannot make a decent go of it on their own self-contained advertising devices.



    Yeah 15% compared to Google's under-30% is no laughing matter.
  • solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by nvidia2008 View Post


    Yeah 15% compared to Google's under-30% is no laughing matter.



    With iOS devices have the majority platform installed base you'd think they'd have a much higher share yet I'm with others who have never seen an iAd.



    PS: It's odd to see a dollar value graph that doesn't have Apple dominating in.
  • applezillaapplezilla Posts: 941member
    Quote:
    Originally Posted by A Grain of Salt View Post


    I have had an iPad from about two months after they were first released and I have never seen the mythical iAd. I use ad supported software but only see google ads. Where do you find them?



    I see them in several apps on my iPhone pretty frequently. iAds are about the only ads I click on.
  • jmmxjmmx Posts: 340member
    Quote:
    Originally Posted by AppleZilla View Post


    I see them in several apps on my iPhone pretty frequently. iAds are about the only ads I click on.



    Out of curiosity? and why is that?
  • tundraboytundraboy Posts: 1,394member
    They were new to the business and got a little greedy. You might be able to get away with premium pricing for consumer products, but you can't do that if you're selling to people who have to defend their budgets to a higher power.



    Apple's learning, regrouping, and hopefully, coming back stronger.
  • mstonemstone Posts: 11,510member
    Quote:
    Originally Posted by AppleZilla View Post


    I see them in several apps on my iPhone pretty frequently. iAds are about the only ads I click on.



    I have yet to see an iAd. I have always suggested that it will be a complete failure because it is only designed for Fortune 500 and not available to the mid-sized company. Why would a Fortune 500 company want to advertise in a 3rd rate ad supported Free app? Any top tier app has it's own revenue stream independent from advertising. Advertising is for TV, magazines and other consumption type media, all of which is already completely controlled by those corporations providing those types of services. I just don't see any revenue for the average app developer in this iAd program.
  • k2directork2director Posts: 190member
    I like it when the world reminds Apple that it's still fallible and has to legitimately work for its success.
  • aderutteraderutter Posts: 215member
    As a developer I prefer iAds over other networks even though I use others also (as a back-up).



    I've found that the lower tier developer iAds (advertising app store apps) bring in more revenue to developers than say adMob, mobFox etc.



    The top tier full iAds tend to bring in 10 times the revenue of the lower tier per impression iAds.



    The problem has always been inventory availability.



    If Apple can sort the inventory then there'll be no reason to use a competitor ad platform.
  • irelandireland Posts: 15,018member
    Quote:
    Originally Posted by SpamSandwich View Post


    iAd will eventually find it's own level. It's ridiculous to think that Apple cannot make a decent go of it on their own self-contained advertising devices.



    Quit predicting my mind.
  • irelandireland Posts: 15,018member
    Quote:
    Originally Posted by nagromme View Post


    Ad-supported apps are NOT my favorite model. But it?s an important option to have, and I?m not 100% opposed in every case.



    It?s probably a good idea for Apple to have their own service that no competitor (Google) can pull the plug on or exert control over. Devs will choose between various ad offerings, but I can see why Apple wants to have their toe in the water as well.



    Plus Apple has proven to be the only large tech company that genuinely cares about user privacy.
  • irelandireland Posts: 15,018member
    Quote:
    Originally Posted by jragosta View Post


    To me, this is the most interesting part of the entire article. While Google owns desktop advertising, mobile advertising is clearly anyone's game at this point. I would love to see it remain split like this, but if someone has to dominate, I hope it's anyone but Google.



    24% is hardly dominating.
  • irelandireland Posts: 15,018member
    Quote:
    Originally Posted by mstone View Post


    Advertising is for TV, magazines and other consumption type media, all of which is already completely controlled by those corporations providing those types of services.



    I think you're wrong on this.
  • irelandireland Posts: 15,018member
    Quote:
    Originally Posted by aderutter View Post


    As a developer I prefer iAds over other networks even though I use others also (as a back-up).



    I've found that the lower tier developer iAds (advertising app store apps) bring in more revenue to developers than say adMob, mobFox etc.



    The top tier full iAds tend to bring in 10 times the revenue of the lower tier per impression iAds.



    The problem has always been inventory availability.



    If Apple can sort the inventory then there'll be no reason to use a competitor ad platform.



    Good point. I think cutting the price to 100,000 and upping the payout from 60 - 70% will help in the inventory department.
  • macarenamacarena Posts: 299member
    I am sure there are several App developers (like myself) who would like to advertise their own products to drive up sales and word of mouth. $100K is way too much for indie developers to shell out for advertising.



    I guess Apple will soon change the rules of the game for Ads. They should announce that apps are free on the AppStore only if they offer no ads, or if they offer iAd. If they go with some other Ad company, then there will be a listing fee for the app. Some nominal listing fees - like $9.99 upfront, and then data charges at $9.99 per Gigabyte downloaded or something like that.



    I am not sure if such a move would be construed as a misuse of a monopoly - it is something similar to Apple's rules saying that if an App allows a purchase from outside the AppStore, then there should also be the same option inside the AppStore. Frankly, when you think about it, it is not really a bad provision. And it will force several developers and therefore several advertisers to move to iAd. Apple has several costs even for free apps - so they need to be able to recover these costs some way. If an app is truly free, with no ads, then Apple offers the service free - but if the developer makes money with Ads, Apple should not allow them to get away scot-free!



    But before this, Apple should get realistic about their policies - cannot have $100K minimums, etc. I don't see why they should even bother with a minimum! Another possibility is that Apple could offer multiple tiers - if your campaign is for $1000, you get a million views, if you have $10,000, you get 12 million views, if you have $100K, you get 200M views, if you pay $500K, you get 2.5 Billion views, etc. Or something like that. That way, an advertiser that has a lower budget will get lesser bang for his buck, but will still be able to use iAd.
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