The Blog

Like a lot of people in the digital marketing industry, I’ve spent a lot of time looking ahead into new advertising formats to help my team and clients understand where the future might take us. Mobile is one specific area that has taken a lot of my attention lately. Starting with the iPhone, we have seen how a well-designed device, fast (3G) connection, and app development/download platform have done for mobile users what broadband did for Internet access. Consumers are used to upgrading their mobile devices rapidly, and the draw of smartphones is expanding rapidly. Nielsen recently projected that U.S. smartphone penetration will surpass 50% in 2011.

Naturally, with the growth in users and their use, marketers want to connect with consumers, and big and small companies alike are jumping in to fulfill this new need. Google and Apple are at the center so far, with an ecosystem of technology startups and traditional marketers leaning in to play ball. But their approach so far is much different, and shows some of the challenges of launching a new marketing platform with meaning. I wanted to take a few minutes to explore their choices and differences so far.

Google Mobile Advertising

Google got in recently with its purchase of AdMob, a company that has worked with many common apps to place ad units onto the screen.

What Works

  • Google has applied its $20 billion-a-year AdWords model to the mobile space by creating a simple, self-service advertising process that allows big and small companies alike to put ads on the market in minutes.
  • These ad units can be served according to location, fit well with the existing measurement services that companies already use Google for, and results can be compared easily across platforms.

What Doesn’t

  • The consumers’ experience is pretty poor at a “moment of truth” when ads start to appear on their favorite apps. Because anyone can advertise on Google Mobile for pennies, it will attract some of the worst advertisers in the market. Chegg textbook rentals are relevant for a tiny percentage of Pandora users, and several friends of mine have been served an “Are you the father?” banner ad.
  • There is no room for creativity in the platform so far. The simple text ads look starkly poor when placed within some of the best apps, such as Pandora. Such companies are ceding their precious pixels to ad units that degrade the experience for their users. Is it any wonder that I recently saw the ad below on Pandora, advertising its ad-free model–and this banner looks a lot better!

Apple’s iAd Platform

Apple, too, got into the mobile marketing game by buying another company. It acquired Quattro Wireless earlier this year to get into the game. However, its approach has been entirely different from Google–befitting a company that trademarked the expression “Think Different.”  The company announced that it was shutting down Quattro’s existing business and putting all of its developers into building out a completely new iAd marketing platform. While Google/AdMob tacked on something quickly to its existing business, Apple is taking time to do for mobile marketing what it has done for laptops, MP3 players, and mobile devices.

What Works

  • The actual ad units are rolling out slowly, but are rich media that is designed to take advantage of the unique properties of the iPhone and iPad platforms. You can see from the video below in which Steve Jobs shows a couple of mockups of ads for Toy Story 3 and Nike.
  • Apple is ensuring that only large, committed advertisers are getting into its new platform. It is inviting a handful of big, mass marketing spenders such as Unilever, Disney, Nissan, and Citigroup. It is also forcing the companies and their agencies to work through Apple’s development process. This means that when you see in iAd for the first time, it will probably be something relevant and special.

What Doesn’t

  • If you have an iPhone or iPad, have you seen an iAd yet? Didn’t think so. Because of Apple’s high standards and long production and approval process, there are only a handful of these in the wild to date.
  • There are many other issues with the tightly controlled iAd platform. For example, it doesn’t tie in to existing measurement tools, the ads are non-standard, and the spending commitment and cost-per-click is high for an unproven media.

My take:

As you can see, the two companies’ approaches are virtual mirror images of each other. The strengths of one are the weaknesses of the other, and vice versa. But to borrow from an expression I heard in my first job sacking groceries at Kroger, I think Apple is working hard while Google is hardly working. As a company, Google has made its fortune by creating a simple advertising unit that works extremely well when paired with search–an activity in which the advertising itself can be useful at a key moment when people are looking for the right place to go. But Google had not been able to apply this model to its other tools such as Gmail and Google Docs, in which people are using the software for other purposes. In these spaces, the AdWords are mainly an irrelevant distraction. I see the same in its mobile platform so far.

I like the fact that Apple is working harder to make a more powerful, meaningful advertising platform. I have argued in the past that it will face many struggles, but I like the idea that the company is taking the longer-term view and trying to define a better way ad model. It is not choosing the easy path of slapping on an acquisition or an existing model just to be “first” in the marketplace. I still believe that most marketers should develop actual, added-value apps themselves versus buying interruptions on the iAd platform, but I am encouraged that Apple is thinking differently and putting its thoughts into real action.

Special Author’s Note: If you have read down this far, you are likely a regular reader and enjoy this content. If so, you probably noticed that I’ve cut back the number of posts I write each week–dropping down from three posts per week to about one. This is intentional and will be the pattern going forward. I love blogging, but have got some other big, Marketing-with-Meaning-related projects that are forcing me to cut back on new content. Plus, I’ve really found that Twitter is a much better place for me to share thoughts, links, and insights in a way that is easier for me to share and for you, dear reader, to consume. Thanks for your readership and understanding!

2 Responses to “New Mobile Ad Formats: Working Hard vs. Hardly Working”

  1. The difficulty that Apple may have in bringing. The iAd service to the iTunes infrastructure is that They have already conditioned users to the pay-model for apps. Adding another, somewhat foreign, subsidy model may confuse users. I see the logic of an ad supported app model, but i think that it would be better received on the Apple TV platform or something similar to the rumored “iTV” iOS platform. Consumers are already conditioned to the ad-model in their living room and the introduction would be smoother as a result.

    Very good post.

  2. [...] few weeks ago I wrote about how mobile advertising is failing to work for either consumers or marketers, and today I wanted to [...]

Leave a Reply

Spam Protection by WP-SpamFree