Science and Tech


Analysis: Apple's Slow Ad Growth Won't Slow It Down

Advertisers don’t like that they can’t get more user information out of Apple. Its iAds growth has been slow as a result.
Posted at 2:12 PM, Feb 19, 2014

According to a new report in industry magazine Ad Age, Apple's got an advertising growth problem.

Apple's ad sales team doesn't set revenue targets. The company has a long development cycle for its products. And, critically, Ad Age says it doesn't want to fork over consumer data that advertising partners would otherwise pay handsomely for.

Apple debuted its mobile iAds back in 2010, aiming for both the interactive potential of web ads and the emotional impact of television spots.

And they got the attention of the advertising industry, some of whom praised the polished presentation.

"They create a really fantastic user experience. The depth, the great engagement, the amount of functionality." (Via Business Insider)

So why haven't they taken off? A writer for Computerworld suggests it's not for lack of marketing firms trying — Apple simply isn't willing to play ball with its collected user data.

"To protect those customers, Ad Age's report means Apple's leaving money on the table, even if it means its iAds service isn't gaining the traction it could."

Despite this, advertisers are still getting on board — the thinking being what they can get out of Apple's data troves is still better than nothing. (Via AppleInsider)

For example: when Apple built iAds into its iTunes Radio with the release of iOS 7 last year, it pulled in names like Pepsi, Nissan and McDonalds for long-term contracts and price tags as high as tens of millions of dollars. (Via AllThingsD)

But even with heavy hitters like those decorating iTunes Radio, ads are almost an afterthought for the company. CNN points out Apple's U.S. mobile ad take was 0.15 percent of its annual revenue.

That’s $257.8 million in mobile ad revenue for 2013, according to the EMarketer numbers Ad Age cited. MacRumors points out companies that are more open with their customer data, like Facebook and Google, clear more than a billion dollars a year in the mobile ad space.

Of course, headlines like these suggest poor ad numbers will hardly take a bite out of Apple. The biggest publicly traded company by market cap can probably afford a tiny ad division. (Via Slate)

For what it's worth ($258 million annually, remember) MacRumors says Apple's ad revenue probably will grow this year, as iTunes Radio gains momentum.