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Why iAds will revolutionize mobile advertising

By Rick Webb on April 14th, 2010

newnewrickIn this column for Boards, The Barbarian Group COO Rick Webb chews over Apple CEO Steve Jobs’ address about iAds, the computer giant’s new mobile advertising platform that aims to bring richer, more emotional ads to mobile phones.

I shouldn’t really take a stab at this topic so soon after it’s seen the light of day, but iAds? Whoa. I knew it was coming, but until I watched Dear Leader Steve up there on stage talking about it last week, I didn’t realize what a complete game changer it is, on so many levels.

First, Apple looks set to deliver a mobile ad platform of one billion devices across iPhones, iPads and iPod touches (and though I haven’t double checked, I’m sure that this is one feature of the iPhone OS 4.0 that will work on older models). And this ad platform isn’t just banners and text links. It is robust brand advertising that is as functional as a website or app. Out of the blue, in one fell swoop, Apple is offering something that many have been wondering would ever come.

Let’s think about this. You’re a brand. You want to engage with your users on a mobile platform. Perhaps you want to do this for geotargeting reasons. Perhaps there’s something about your brand that aligns with mobile. Whatever the reason, up until now, you had a few options. You could make a mobile site or app. Robust and brand-driven, to be sure, but then you find yourself in the awkward position of needing to promote your advertising in order to get anyone to download it. You could pursue a mobile ad strategy - banners or text links via companies like Quattro or Google. These will get you some penetration, but at the expense of telling a brand story. As an aside, it was incredibly heartening to hear Steve talk about the limits to current mobile advertising and the lack of brand and emotional impact in his keynote. Google’s little blue links have been diminishing the importance of emotion for too long. It’s time for a counter balance.

Anyway, now there’s a third option: all the robustness of an iPhone app or mobile website, with the added benefit of a means of easily getting that site into the hands of customers. That, to me, seems like a monumental new value proposition.

Next, Apple has essentially added a concrete means by which app developers can deliver their apps for free and still draw some revenue. Sure, there were mobile ad platforms before, but none had the scale and capabilities to draw massive sponsor and brand interest. I’ll be shocked if this doesn’t happen now. If you bought an iPad, you’ll notice that app developers are a bit more aggressive this time on their pricing - there aren’t near as many $0.99 apps. Apps are a smidge more expensive. And that’s fair. App developers had driven their pricing to absurdly low levels. Most of my friends who develop apps have never realistically aspired to anything other than a supplemental income from them. Now, this might change, without the commensurate price increases to the consumer. Sure, this means you give up some of the real estate in your app to the ads, but presumably many apps will offer ad-supported and paid versions. It’ll be up to us, with a real revenue option on the ad-supported side for the developer (with a hefty 40% cost, to be sure, but still).

Next, it’s going to be kind of hilarious watching Apple turn into the sort of company that works directly with advertisers, and - gasp! - services them. Sure, the acquisition of Quattro Wireless will help this - presumably they have a lot of account executives - but it’s gonna be hilarious to watch. Is Apple committed to servicing the media agencies like they are accustomed to? It seems to be antithetical to their DNA. We’ve seen other tech companies wrestle with giving the media companies the service to which they’re accustomed - Facebook had some early stumbles, as did Twitter. I can’t wait to see how Apple fares.

And then! And then! HTML5! Every Flash shop in the country, every banner studio in the Dominican Republic, etc, better be sharpening their HTML5 skillz. People have debated Apple’s ability to single-handedly kill off Flash as a rich media platform, but this has the potential to be a pretty significant blow. We all learned Flash as it supplanted GIFs for rich media advertising on the web. Perhaps this will spur us to move on.

That is, assuming Apple lets us. Rumor has it that at the beginning, Apple itself (via Quattro) will be making the ad units. That’s a logical short-term move, but a terrifying prospect in the long term: Google captured a lot of the ad market with their little blue ads, but at least creative shops (such as ours, natch) could still find room to breathe and to work. It’d be terrifying if Apple just… never opened up the platform. I’m hopeful and confident that won’t be the case, but man, that’d be scary.

And, for that matter, how do you even buy one of these things? Can you self-serve it like Google? Can you choose the types of apps that your ad appears in? Can you avoid certain apps? Do you need to be approved? I read the Engadget live blog of the iPhone OS 4.0 launch, and when they got the Q&A, Engadget basically stopped blogging as people asked these questions, so I don’t know all the answers. I wonder how much Apple has told us yet. Still, the mind reels at the various possible kinks and quirks of the process.

I would hope and assume that they’ll make the whole thing as easy and open as possible in an endeavor to capture market share for the iAd platform, so there’s no point worrying yet, but at the same time, I’ll be surprised if at least one unforeseen kink doesn’t crop up.

It’s amazing to me that one seemingly innocuous product announcement has the potential to shake up so many markets. Online advertising. Search. HTML5. Paid vs. Freemium. It’s an exciting announcement.

Disclosure: I’m an Apple stockholder, built software for them, and still own a functional eMate.

www.barbariangroup.com


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  1. Input » Blog Archive » Why iAds will revolutionize mobile advertising – Boards « Bytes Hotdish says:

    [...] Input » Blog Archive » Why iAds will revolutionize mobile advertising – Boards. By Rich McG, April 15th, 2010 | Tags: iAd | Category: Advertising [...]




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