BNXS

The iAds which were introduced last year were set to revolutionize the world of mobile advertising. Steve Jobs, the Apple CEO who is currently on medical leave wanted the mobile ads on the Apple platform to be seen as branded experiences in themselves. The Apple iAds were therefore charging premium rates since they were being compared to and competing with TV ads. For a single campaign advertisers were required to part with not less than a million dollars. Apple was able to sell $60 million of its ads.

Now things appear to be changing. Developers across the board are reporting drastic drops in fill rates after New Year. The fill rate refers to the percentage of an ad inventory that is filled with ads. For instance there are two developers whose fill rates have dropped from 18 percent to 6 percent. A few new apps were even having none of their slots taken up. The recent trend has called for some digging to find out why this could be happening.

The dropped witnessed can well be because of seasonal change. It is normal for ad budgets to down especially after the end year holiday season. But in the case of iAds there seems to be more to it than the season change. A mobile ad tech CEO pointed out that the community was not interested in the product. You see when the iAds were introduced they fared well because in many of the instances it was the company CEOs who were making a one time decision to invest a million dollars into it. Since then most of the ads have run their course and the advertising decisions have been thrown back to junior officers. It is quite understandable that many of them are not in the position and neither would they feel comfortable investing such an enormous amount again. See not many companies even have the mobile ad budgets totaling to a million dollars.

The other possible problem is that the ads run on devices from the Apple Company only unlike other mobile ads from the likes of Google which are displayed on a number of platforms. Advertisers are also blocked from knowing where their ads are run. Apple is entirely responsible for making this decision. This approach is most definitely from the experience that Quattro was experiencing before, where advertisers choose to be in the apps that were a current hit while other apps were left with nothing. Quattro has since been acquired by Apple for $275 million.

As it is Apple may have to look at the possibility of lowering it prices. While it is true that $1 million budget for television ads is nothing out of the ordinary, it is different for mobile ads and those involved have to get used to the idea. So far we are aware that Jobs was not targeting mobile ad budgets but TV ads budgets which is also most likely the reason why Apple touts the performance of iAds against TV ads. Whether the mobile advertising industry adopts this idea and how long it will take to do this is anyone guess.