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Apple Launches iAd: Masks A Bigger Problem For Marketers

 

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iadYesterday, Apple announced a new advertising platform for its popular iPhone. The platform, named iAd, will allow application developers to serve ads on applications distributed through the Apple Application Store. Apple hopes that marketers will buy ads in hopes of reaching the 50 million iPhone users currently on the market. With iAd, developers can use the platform to serve ads within their applications and will keep 60 percent of the revenue going to Apple for serving and hosting the ads.

The ads are displayed using HTML5 instead of Adobe Flash, and instead of sending users out of the app when the ad is clicked, iAd keeps users in the application to get more information from the advertiser. Apple is providing developers access to different APIs that will allow ads to interact with iPhone features such as the accelerometer, giving iAd a superior usability advantage over other mobile ad networks.

iAd Solves The Wrong Problem

iAd takes a bad problem and makes it a little better but fails to solve the bigger issue. When people use an application, they want to read an article, play a game, or watch a video, they don't want to interact with an ad.

Do you like banner ads? Do you click on banner ads? 

Developers making free applications deserve to earn money for their time and many of them likely will with iAd. However, marketers, do you believe that buying ads on the iAd platform with solve your marketing problem? It won't.  As a marketer, you need to be the "app" not the ad. The app is what everyone downloads, talks about, and interacts with. The ad is the thing that gets in the way of of the fun. Which would you rather be?

3 Ways Your Business Can Be The App

Am I suggesting that companies shouldn't buy mobile ads? No. I am suggesting that mobile ads don't hold nearly the lead generating power that being the "app" does. Ads on any platform can be expensive. I would urge marketers to think about how their potential customers use mobile devices. Would your prospects be better served by seeing your ad during a game of sudoku or by interacting with an application that helps to solve their business problems?

With the money your business could likely invest in mobile advertising, I maintain that it would yield a higher return on investment to build out mobile content in the form of an application or mobile optimized web site.

What can your business do to create compelling mobile content?

1. Understand How Your Customers' Problems Are Different On The Mobile Web
- When your prospects are interacting with different types of digital media they have different needs. For example, mobile content needs to be more brief than content consumed on the desktop. Many mobile devices now have built in GPS chips, so location is a much more important component of mobile consumption. Get to the very nature of how your customers work and consume information on the go. How can your business provide value for them in that context?

2. Having A Mobile Lead Generation Process - Just because mobile devices have tiny screens doesn't mean that lead generation strategies and ROI metrics go out the window for the sake of doing something cool. Because prospects may interact with your content on mobile devices differently, your method for generating leads in a mobile environment may be different. For example, perhaps the goal of your mobile application is to build your opt-in text message database this mobile phone numbers of prospects. This is likely different from a desktop content marketing environment, which might have the goal of generating e-mail list subscription.

3. Know That A Mobile App Isn't A Tiny Version Of Your Web Site - Too many web sites are boring, and the only thing worse than a boring web site is seeing it copied onto a mobile application to be boring on yet another device. While parts of your web site may be compelling to mobile users, it is doubtful that all of the features will be. Because you likely have a different lead conversion goal on mobile platforms, it is important to make sure that your content and distribution match that strategy.

What do you think of Apple's new iAd platform? How does your business plan to reach prospects via mobile platforms?

Live Webinar: The State of Inbound Marketing Lead Generation

Learn how companies are using inbound marketing techniques to generate higher volume and lower cost leads and customers.

Date and time: Wednesday, April 7, 2010 at 1:00pm EDT 

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Photo Credit: Techcrunch

Posted by Kipp Bodnar on Fri, Apr 09, 2010 @ 07:00 AM

COMMENTS

I agree that marketers could abuse this new platform to create more unnecessary noise in what I personally consider a very safe place to avoid ad.  
 
But I also think there is a great chance for smart marketers to create timely & complimentary content that plugs in to an apps task at hand. If I was trolling a comedy theatre's schedule schedule and I got an interactive ad for "UCB comedy" - I'd probably like it.  
 
I wouldn't write this off yet - it's way to early.

posted on Friday, April 09, 2010 at 7:15 AM by Brian Donnelly


Great post Kipp. This new advertising platform for the iPhone is very interesting. I like the fact that they will be able to gather more information for the people making the advertising available through the platform. You raise a very important point as well about the "app" being the ad. I sure as hell don't ever click on banner ads on my mobile phone! They are intrusive and annoying. The people who will continue to be truly successful in this space are the ones who know their mobile customers best and can give them something fun, useful, and branded to help market their services.

posted on Friday, April 09, 2010 at 7:28 AM by Matthew Nelson


As a consumer and a Business owner, I'm actually more concerned about this iAd platform than interested or excited. Apple is continuing to make a hard charge toward creating a completely "Closed" System, not only for Hardware and Software Developers, but first for Content Developers, and now for Advertisers.  
 
I clearly understand the business strategy from Apple, but I'm not sure that enough business folks or consumers are recognizing just how severely the closed system will effect their ability to market in an App Driven platform - Apple will have the ability to pick and choose whose content will be delivered and whose will not, which is opposed to the very ideals that have become the tenants of the internet and the social web.  
 
I love a good App, and I agree that we should all be looking toward the Mobile Web with useful tools. I just wish that it was based on flexibility and choice rather than mandates and Control. 

posted on Friday, April 09, 2010 at 8:11 AM by Michael R. Thomas


Great post! At this point I have more questions then answers how will this work as well who will be able to use. Currently I can't see every business benefiting from it but I am sure the same was said for PPC when it was launched. Either way I will follow it closely as I am sure we will all be able to use it sooner rather then later.

posted on Friday, April 09, 2010 at 8:19 AM by Vancouver Search Engine Marketing


Thanks for the insights. You make some very interesting observations, and I will watch to see how this progresses. But what do you mens by "For example, perhaps the goal of your mobile application is to build your opt-in text message database this mobile phone numbers of prospects."? 

posted on Friday, April 09, 2010 at 8:27 AM by David Frawley


Looking forward to downloading the Grader iPhone app :-)

posted on Friday, April 09, 2010 at 9:13 AM by Colin Warwick


That's a strong statement to make - you don't need to be the "app" - you can deliver compelling campaigns that take advantage of unique attributes of both apple and androids platforms that can drive relevancy for the consumer and strong calls to actions right to conversion to sale at point of sale online (mobile) or brick & mortar. 
 
It is not a one or the other scenario - it can be use of both in app ads and apps - take the Masters for e.g. a time based event app will be gone next week, using ad to promote last week and this week is a very compelling use case and successful outcome for using both.  
 
Similarly driving consumers to an action within a mobile app and not driving them to another app can be highly successful. There is plenty of use cases out there now of success with much higher CTR and end results than the web and other traditional channels. 
 
There is no one answer fits all in mobile for marketing - each brand and even each campaign can take advantage of different channels to drive ROI.  
 
It is a multi channel world now that allows marketing teams to address highly segmented consumer and B2B audiences. Again no one size fits all. 
 
Shane

posted on Friday, April 09, 2010 at 10:43 AM by Shane Lennon


After seeing the iAd demo by Jobs, I think this is marvelous. I do understand that companies will still need to "be the app" but at the same time they can be part of someone else's app!  
 
More importantly, Apple is tapping in to something very powerful here. People are becoming increasingly disconnected from the hear and now. It's common to see that whenever people have any time on their hands, they choose to immerse with their phone. They may play a game, watch a video, read news. But the actual purpose in most of this is to escape from the ordinary boringness of life. What a moment every moment like that is for brands to connect with their audiences.  
 
After seeing the ads, just gotta wonder what's the CPM on these puppies!

posted on Friday, April 09, 2010 at 10:50 AM by Mikko Kotila


You can easily separate the consumers from the marketers in the comments! 
 
 
 
Assuming someone is inside an app by choice, it would follow that something of interest may be valuable in a timely sequence.  
 
 
 
Becoming unintrusive means making the service opt in, real time and must consider other device managed preferences like "offers off thanks"- otherwise it's a stranglehold play that will drive bandwidth paying consumers away.

posted on Friday, April 09, 2010 at 11:24 AM by Craig


Side note: I've never understood why so many of us fail to get their minds around the fact that it's mostly a very low-income demographic that clicks on ads. My agency wrote a book two years ago that revealed this. Guess nobody believed it. More likely no one read it!

posted on Friday, April 09, 2010 at 11:57 AM by Stan DeVaughn


First of all thanks a lot to share this wonderful post Kipp. As always your articles are informative and insighful. Regarding this concept I think there are always two sides of a coin...it's true these days we all are overly bombarded with different marketing and advertsing campaigns and in this scenario our so called "private space" is gonna be invaded by iAd. All in all, it's too early to say anything till we actually see and experience this new concept.

posted on Friday, April 09, 2010 at 12:37 PM by Rakesh Sharma Jack


I'm interested in seeing how this plays out. My guess is leaning towards greed on Apple's side. They want a piece..or should I say a bigger piece of the pie.

posted on Friday, April 09, 2010 at 12:49 PM by NookSurfer


Display the ad prior to downloading the app. Like viewing a video on the net. You're forced to watch something to get to what you want. 
 
I do watch the ad's prior to seeing the content that I'm really interested in.  
 
Leave the app alone.

posted on Friday, April 09, 2010 at 12:54 PM by Jim Dandy


What if someone was able to raget those ads to specific audience?

posted on Friday, April 09, 2010 at 5:34 PM by Stephen


I agree with Craig in that the consumers are easily identifiable from the marketeers. I'm a consumer and it really detracts from the quality of an App to have advertisements in it. I don't need to see an advertisement for Nike when I'm reading a book. The only time I've ever tapped an in-app-ad is by accident, to my great displeasure. I wouldn't be surprised if Apple's next product is a touch screen device with a cover-flow-esque GUI that lets you flick through advertisements. I'll stick with my first generation iPod for a while, and will drop Apple products completely if I see advertisements within Finder or on the login screen.

posted on Monday, April 26, 2010 at 4:18 PM by Sean


Comments have been closed for this article.