Guest Post: The future for iAd

by Sultan Khan, CEO with AdMaxim

When Apple unveiled iAd back in 2010, it seemed the mobile advertising equivalent of Nirvana. Here was state of the art technology that enabled advertisers to create beautiful in-app rich media ads to target a ready-made community of iOS device users. Three years on and the picture is more complicated. The short answer as to whether iAd has a future has to be “Yes.” iAd has a number of rich interactive ad types and is backed by Apple which already has a sizeable footprint so it will always be attractive to advertisers.

The more interesting question is whether iAd will become the dominant mobile advertising platform.

My view is that it will remain an important part of the mix rather than dominate the mobile advertising market and this is based on three key reasons.

The first is that iAd only serves ads to iOS devices (iPhones, iPod Touch and iPads).

However the market share for iOS is diminishing as the adoption of Android devices increases.

Latest figures from research firm, IDC, show that in Q4 2012, Android accounted for 70.1 per cent of the smartphone OS market, up from 52.9 per cent for the same period the previous year.

“iOS accounted for 21% of the smartphone market in Q4 and 18.8% over 2012″

This was not an end of year blip – Android accounted for 68.8 per cent of the smartphone OS market throughout 2012.

Meanwhile iOS accounted for 21 per cent of the smartphone market in Q4 2012 and 18.8 per cent over the year.

These figures present a problem of reach for large advertisers who want to run campaigns that target all device types and a much wider audience base.

Secondly, most other companies in the mobile ad delivery space have increasingly moved towards standardising on HTML5 to build rich media ads.

This means the trend is increasingly in favour of cross device compatibility.

iAd’s customised proprietary approach to creating rich media campaign goes against this trend.

A few years ago, when achieving rich media functionality outside apps was technically difficult, Apple’s closed world strategy of creating in-app rich media campaigns using its proprietary technology seemed to be a no-brainer.

However, now that HTML 5 JavaScript web apps are able to create similar experiences to those in apps, this approach looks short-sighted.

It also means that advertisers that want to use iAd in addition to other networks need to create a separate campaign just to run on iAd.

Thirdly the cost of running campaigns on iAd is seen as a real barrier to entry.

When Steve Jobs launched iAd he said that the starting point for mobile ad campaigns was $1million.

Subsequently it’s come down to $100,000 but that is still to high for many advertisers especially at this stage.

A lot of advertisers are new to mobile; want to start with smaller budgets; and then learn how mobile advertising performs for their brands before spending big bucks.

On the plus side, Apple is hugely innovative – the larger, high def screen on the iPhone 5 plays well with advertisers and consumers.

An iAd supports several interesting targeting options; consumers love Apple products; and their inventory continues to grow.

So, while iAd is unlikely ever to be be the dominant mobile ad platform, it remains an important part of the mobile advertising landscape and its future is secure.

Author biog

Sultan Khan is Pakistani and was born in 1972. His first directorship was in 2007 with The Yellow Number Ltd when he was 34 years old at the time. Presently he is chief executive officer and co-founder of AdMaxim. The company which was established 2008. AdMaxim is an integrated mobile advertising platform which enables brands to reach consumers on the move anywhere, using precision targeting and real-time optimisation technology.

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