Get Ready for More Mobile Ads on Your iPhones as Apple Launches New iAds

Taps tech partners to develop marketing machine

Apple is finally showing it is serious about mobile advertising. Its iAd business has gone through several iterations and struggled, and the company is now tapping the ad tech community to open the service widely so marketers can get access to its iPhones, iPads and computers.

Today, Apple is unveiling partnerships with companies like AdRoll, which will flip a switch and start serving iAds through its automated marketing platforms. This turn toward programmatic mobile advertising has been in the works for at least a year. Last year, the company stopped treating iAd like a high-end marketing platform for only the top brands with the most cash.

Apple wanted to build a self-serve mobile advertising system in house, and it bought Quattro Wireless to help. Sources said that effort faltered, and Apple decided to partner with ad tech companies like AdRoll and The Rubicon Project to compete with mobile ad giants like Facebook, Google and Twitter.

AdRoll is a retargeting specialty firm that lets marketers use their own consumer data profiles to deliver ads across such platforms. And Rubicon unexpectedly leaked word earlier this week that it was partnering with Apple.

As for Apple, iAd is a small portion of the mobile ad industry despite its large base of iPhone users. Still, with iPhones making up more than 40 percent of all smartphones in the U.S., Apple is in a unique position to grow its ad business to reach those users. AdRoll CMO Adam Berke said the new iAd system is going to reshape the mobile advertising landscape, opening access to consumer data Apple had walled off for a long time. Here's how:

  • Berke expects the new iAd to reach massive numbers of users quickly. Apple is using standard format ads to make it easy—mobile banners and video already in use across the industry.
  • App-install ads will immediately be in demand and give mobile developers a new edge in the App Store, which can be a tough environment because of the sheer volume of apps.
  • Apple iTunes and App Store consumer data will finally be open for use to target ads. This is tremendous information about which apps every user has downloaded and which media each one consumes. This knowledge has been locked away within Apple, untouched by marketers until now. "They have App Store behavioral data, and we'll be able to target based on the types of apps that people like," Berke said.
  • The ads will show up in apps that use iAds, and the App Store has hundreds of millions of them, opening up never-before used ad space. "Any app developer using iAd will suddenly have a lot more demand and a lot more advertisers buying their inventory," Berke said.
  • Apple Pay, the new payment service, will feed into the advertising. This is the final piece of information marketers need to know for certain if their ads worked—did the user buy their product? This purchasing behavior is something only Apple will have access to through its control of its mobile ecosystem.
  • "It [could eventually] allow us to track from the mobile ad impression to the App Store behavior of the user to the app install to eventually someone buying with Apple Pay," Berke said.

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