Apple iAd fails to compete with Google and Facebook
In 2010, Steve Jobs announced the launch of iAd in attempt to redefine the mobile advertising game. The plan was that Apple would serve as an intermediary between developers and advertisers by allowing the seamless integration of in application advertisements. Developers would code in containers for specific ad specs and advertisers would dictate the types of impressions they desired. Apple would take care of the rest by matching the appropriate spaces with the appropriate ads. Of course they would also take a cut, a small price to pay for a better experience. Steve Jobs sought to break Google’s strangle hold on internet advertisement and hoped to eventually achieve over 50% market share. However in June 2016, after just six years, Apple dropped iAd which at the time boasted a measly 6% market share. But why did it fail? What’s Apple’s plan from here on out?
iAd was too expensive and too clandestine. In short too Apple. Online marketers and ad agencies bemoaned the red tape around the creative ad development process. Apple had stringent policies on how and what could be advertised. Unlike Google or Facebook, Apple was also a third party. This drove the price up. On top of that, Apple’s strict privacy policies wouldn’t allow its clients on either side of the deal to access to the marketing data. Instead they focused on old school sales tactics from a dedicated iAd sales force to drive the market. This was a stark contrast to the “relatively” transparent auction format practiced by Google and Facebook. And considering its failure advertisers clearly didn’t bite at the premise of an easier and more seamless advertising experience.
With the abandonment of iAd, Apple now requires that ad hungry developers and impression disparate advertisers communicate directly… so you will continue to in app advertisements for now. It has been encouraged that these developers use an auction format similar to that of Google or Facebook. Yet it has been speculated that Apple may focus on beating its competitors by changing the game. Instead of trying to offer a better experience to the advertisers, Apple is turning its attention to the user. They could seek to develop a world where the user pays a premium not to see any ads at all, thus cutting its competitors off at the legs. But for now Apple is just trying to make sure Siri does Google anything.
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