Apple's mobile ad service attracts big brands

09 June 2010

NEW YORK: Many major brand owners have already signed up to Apple's new mobile advertising platform, which is tipped to drive up interest in this emerging channel.

Apple first unveiled its iAd service in April, and its ceo, Steve Jobs, outlined further details about this offering at the organisation's annual Worldwide Developers Conference.

He also reported that a diverse range of corporations had bought up inventory prior to the official roll out of this system in July.

This group included retailers such as Best Buy, JCPenney, Sears and Target as well as financial service providers like Citi, Geico, Liberty Mutual and State Farm.

Campbell's Soup represented the food industry, alongside AT&T from the telecoms category, media owners DirecTV and Disney, luxury giant Chanel and General Electric, the conglomerate.

"Those are some of the brands, and we couldn't be happier. We're so excited," Jobs said.

While presenting at the event, Jobs demonstrated an ad for the Nissan's Leaf electric car, which allows consumers to compare the mileage of this vehicle per dollar with a variety of its competitors.

"We're trying to combine the emotion of video with the interactivity of the web," Jobs argued.

To date, Apple has secured $60m in advertising sales from businesses eager to leverage this medium, giving iAd a strong provisional foothold.

"We think it's going to be 48% of the entire US mobile display ad market," Jobs said. "We think we're off to a pretty great start."

Noah Elkin, a senior analyst at eMarketer, the research firm, similarly suggested that Apple's entry into this sector may finally bring mobile advertising towards the mainstream.

"For something that hasn't been in the market and is unproven, that's a lot of money," he said.

"By getting behind mobile advertising in this way, Apple could create a rising-tide situation that will give the business a lot of momentum."

Unilever, the FMCG manufacturer, has also penned a deal to use iAd, with Dove For Men set to be the first product from its portfolio to be featured on Apple's devices.

Babs Rangaiah, Unilever's vice president, global communications planning, said this strategy would help it make an impact in an area that is attracting huge numbers of potential customers.

"We know that 25% of the world is online now, but the next 75% will mostly get online via mobile, and mostly in developing and emerging markets," he said.

"This partnership will offer us the ability to work within what we believe will be the future of the mobile internet – apps."

Unilever's senior communications executives, including chief marketing officer Keith Weed, recently visited Apple on a trip to the US in May.

"It's great to have been able to translate conversations from a month ago into concrete action so soon and to be at the forefront of something so innovative," said Weed.

"Unilever has always been an innovator in advertising ... and we are now leading marketing into the digital age, where the key will be to unlock the potential of mobile."

Julie Ask, an analyst at Forrester, the technology and research specialist, said the minimum charge for advertising through iAd stands at an estimated $1m, but added it may be worth the money.

"Advertisers can count on the buzz surrounding iAd's launch on July 1. That alone may justify the initial buy," she said.

"These initial advertisers are a smart bunch. A few million dollars isn't much to any one of them, but these are sizeable buys for mobile."

Data sourced from ThinkQ, CNET, Dow Jones, Unilever, Forrester; additional content by Warc staff