Apple pushes mobile ads

14 December 2011

CUPERTINO: Apple, the electronics giant, is adopting a more collaborative approach to mobile advertising, as it seeks to attract brand owners to the iAd platform used by its devices.

The company first rolled out iAd in July 2010, but has now formed a tie-up with OMD, Omnicom Group's media network, to enhance its in-house knowledge, and that of its clients, in this area.

Over 30 marketers representing firms like PepsiCo, the food and beverage manufacturer, Clorox, the household products specialist, and JC Penney, the apparel chain, have also recently visited Apple's headquarters in Cupertino.

Alongside gaining a stronger understanding about how Apple works as a whole, these trips involved meeting members of its product and design teams to acquire and share insights.

"They are still learning the advertising world," Shiv Singh, head of digital at PepsiCo Beverages, told the Wall Street Journal.

Unilever, the FMCG manufacturer, has run 13 iAd campaigns to date, promoting brands such as its Dove beauty range for male shoppers and Ben & Jerry's ice cream.

The firm, which has signed up for further campaigns in 2012, found that the typical user of Apple's mobile devices was exposed to individual ads for 68 seconds, indicative of a high level of engagement.

"We got in there early and we're both learning together. They learn from us and we've learned from them," Keith Weed, Unilever's chief marketing officer, said.

IDC, the research company, has estimated that US mobile display advertising will be worth $630m in 2011, with Google taking 24% of revenues, ahead of Millennial Media's 17% and Apple's 15%.

Karsten Weide, an IDC analyst, argued the limited reach of Apple's products, and its failure to deliver an "advertising experience" that is as "perfect" as desired could be problematic. "Apple we believe will, over time, fade into the background," he added.

More broadly, some industry observers think the price commanded for iAd campaigns, originally pegged at approximately $1m, has fallen dramatically, possibly to $400,000 or so.

"Apple said, 'Let's try to disrupt the advertising business.' On this one, they didn't succeed," said Alexandre Mars, Publicis Groupe's head of mobile. "They know that they need to adapt ... if they want to survive - even if it is Apple."

Data sourced from Wall Street Journal; additional content by Warc staff