Pitch deck: How Apple approached advertisers its first ads business

Some say Apple’s long-awaited privacy update paves the way for an extended run at ad dollars. What better time, then, to take a look back at where Apple’s ambitions for advertising started — iAd.

Launched in 2010, iAd was a mobile advertising platform for in-app advertising. At the time, it was sold to marketers as a way for them to reach premium audiences on Apple devices, according to a pitch deck obtained by Digiday and verified by three different agency execs who worked on iAd campaigns.

Naturally, Apple had high hopes for iAd, believing it would someday account for 50% of the market. It never got even close. In fact, eMarketer pinned iAd’s grip on the mobile display ad market at just 5.1% in 2016. For various reasons, advertisers didn’t take to it in the way Apple had hoped.

To understand the trials and tribulations of iAd, here’s a closer look at the pitch deck the company used in 2015 to loosen advertisers’ pursestrings.

At a glance, iAd seemed like the mobile equivalent of nirvana. Here was innovative technology that let advertisers create dynamic in-app ads targeted at a fast-growing community of affluent iOS device owners. It seemed like a small price to pay for the hefty $1 million per campaign fee and advertisers ranging from McDonald’s to Kellogg’s jumped at the opportunity.

iAd only served ads to iOS devices (iPhones, iPod, Touch, and iPads). Initially, this was seen as a win. It was pitched as a way to reach unique audiences in key markets. Eventually, it became a problem. Despite the popularity of Apple’s devices, the smartphone market was swarmed by Android devices. Even in 2013, Android’s share of the smartphone market accounted for around 70%. As a result, iAd’s restrictive approach to serving ads became a real issue for marketers who wanted to run campaigns that targeted all device types and a much wider audience base.

For all the flaws with iAd, it did offer some interesting targeting options, and its inventory did grow thanks to the proliferation of iOS devices. iAd never did become the dominant mobile ad platform, but it could have become an important niche in the wider ecosystem.

Five years in and the outsized expectations of iAd were clear. It cost €17,000 ($20,000) to run an iAd campaign in 2015 — a far cry from the $1 million the format cost when it was billed as a seismic change for advertisers. Still, iAd’s price point was always going to be an issue in a market that was still in development — even as recently as 2015. It meant that iAd was only ever going to be able to capture so much investment.

“This was because it was still CPM based versus what other performance ad networks were offering with low-risk buying models such as cost per install,” said Shumel Lais, CEO of mobile advertising intelligence business Appsumer. …read more

Source:: Digiday