Mobile ad war
Image by Lydia Simmons
Mobile
09.09.2010
In:
Technology
The increased usage of smartphones has kicked off a mobile ad war and is changing the way that marketers are reaching their audience. According to Nielsen, by 2011 more than 50 percent of Americans will have smartphones that run apps and mobile web browsers.
This explosive growth is driving the evolution of the mobile ad industry and is forcing marketers to prepare for a future in which mobile is ubiquitous.
The mobile ad war heated up in 2009 when Google beat Apple in the acquisition of the AdMob mobile ad network. Then Apple fired back by buying Quattro. Now Apple and Google are digging their trenches in what will be a long, heated battle for the future of mobile advertising.
Apple has folded the Quattro ad network into its new iAd platform for all iOS4 devices such as iPhone 4, iPad and iPod Touch. Meanwhile, Google fought the FTC and got approval for its AdMob acquisition to extend its advertising model to mobile via the Android mobile platform.
Context and location are key in mobile ads. Knowing what users are doing and where they are allows ad networks to display localized and contextualized ads. Apple won a victory over other ad networks when it disallowed location-based ads on iPhone through anything but its iAd offering. This will help Apple corner the iPhone ad space. It also leaves marketers at Apple’s mercy if they want location-aware ads on iPhone.
Google is going the other way. Android is completely open and allows advertisers to use GPS. Google is also working hard to lower the barrier to entry in the smartphone market by offering the Android operating system to handset makers for free. The result is a growing army of Android devices that are swelling the user base for Google’s mobile ad network.
Another difference between the battling giants is Apple’s focus on in-app ads. Apple’s new iAd platform will provide rich advertising experiences right within an app. So far Google’s focus has been on AdSense search ads on mobile websites. Google is hoping that AdMob’s expertise will help ramp up its banner ads and in-app advertising.
If Google can tie a strong mobile ad network offering to its already strong analytics package, the company may be able to establish Android as the best mobile OS for both users and marketers. Google’s open model and profit sharing with device and network partners will create a wider ad ecosystem with lots of options.
But when trying to predict the outcome, we should keep in mind Apple‘s strategy: to create the best products and best user experience. One result is that iPhone users are still more likely than others to buy and use apps. Apple has a proven monetization engine in the iTunes store, and its iAds platform may very well revolutionize mobile advertising with compelling in-application ads.
As we move forward, the only thing for certain is that this war is far from over.
