News

POV: The end of iAd

Mindshare Point of View

Apple has announced that it is closing its iAd App network with effect from June 30th 2016. Apple’s focus will shift to developing marketing platform technologies for publishers, rather than having an ad sales team and service and all of the iAd sales, account management and creative teams are being made redundant.

Details and Implications

Apple have shared an official statement to say that campaigns booked via iAd sales will run through 31 March 2016.  App Network advertising will be discontinued from 30 June 2016.  Campaign reporting will be available until 31 December 2016.

Apple’s decision to launch the iAd network in April 2010 was an attempt by an increasingly successful tech company to exert control over a fast growing media channel that it had helped to create. This ‘control’ wasn’t merely financial – when launching the product Steve Jobs stated that ‘mobile ads suck’ and that it was the goal of iAd to create beautiful, engaging mobile advertising that would allow developers to monetize their Apps and in so doing keep them free.

In 2010, there can be no doubt that mobile advertising formats did need fixing and iAd offered ‘the emotion of TV with the interactivity of the web’ that Jobs had promised. However, the desire for perfection that Jobs demanded from everything associated with the Apple brand resulted in exorbitantly high entry costs for the first iAd advertisers. At launch in July 2010, Apple expected $1m investment per iAd campaign. This was lowered to $500k in February 2011 and $300k in July the same year. These high entry costs resulted in fulfillment rates so low that even a company as profitable as Apple was forced to concede – in June 2013, the minimum investment for a campaign was reduced to $50k.

Apple also had problems reconciling its core business in the premium technology environment with its advertising business. Apple sits on a vast amount of data which could have been used to make an extremely compelling sell to agencies. However, its reluctance to share data and refusal to accept third-party tracking, when combined with high prices and the rise of mobile creative platforms - such as Celtra - meant that iAd never lived up to its full potential.

Summary

The knock-on effects of the closure of iAd have the potential to be much more serious than the closure of the platform itself. iAd never really fulfilled its potential as a media partner and the build capabilities offered by iAd Workbench can easily be replicated in Celtra, our preferred mobile creative platform in the UK.

It’s targeting, while based on iTunes account information, was never as accessible as hoped and our mobile trading partners have more than enough scale to fill the void. If it does signal Apple’s intent to change mobile display advertising on mobile devices then it places more of an emphasis on our objective as an agency to create adaptive content that draws upon data and technology as a means of delivering engaging mobile experiences to an elusive audience.