Apple's iAd slashes minimum spend to $50 with Workbench rollout
Apple (NASDAQ:AAPL) is rolling out iAd Workbench, a suite of new self-serve advertising tools enabling iOS developers to promote their applications for as little as $50.
Workbench offers developers a dashboard for building targeted ads running inside other iOS apps--users input their ad buy budget, maximum daily spend and cost-per-click bid, and Workbench estimates how many users will likely see the ad, click on it and download the app in question. The service touts both manual and automatic targeting options, letting developers pinpoint user demographics based on anonymous behavior and preference data or allowing iAd to determine the right audience.
Workbench also features analytics tools for optimizing and refining iAd campaigns as well as performance metrics detailing total impressions, average cost-per-click and total downloads.
Workbench signals a dramatic shift for the iAd business. When Apple first unveiled iAd in 2010, the company demanded a minimum $1 million campaign investment, dramatically limiting marketer interest in the network, and it also maintained control of all aspects of iAd technical production. In Feb. 2011, Apple slashed the minimum buy to $500,000 in an effort to attract advertisers with more limited budgets while simultaneously boosting iAd fill rates (the percentage of ad inventory filled with actual advertisements). A year later, Apple once again reduced the minimum buy, this time to $100,000--the company also began awarding app developers 70 percent of iAd revenues, up from the previous 60 percent, a step to compensate for lower ad rates and to incentivize developers to build their businesses on iOS.
The Workbench launch is "an admission that [Apple] got it very wrong in the first place," Jason Barrett, head of monetization at mobile software development firm Grapple, told Mobile Marketer. "iAd was completely unaffordable to all but the highest-spending brands, and Apple took total control of the creative process on their behalf. Now any brand can advertise, and they can create their own campaign collateral... The brand count for iAd will inevitably increase sharply as a result, but Apple will no longer be able to dictate the look and feel of the advertising that they carry which may, as far as Apple are concerned, have a negative effect on the visual/design quality of their advertising environment."
Workbench also follows in the wake of reports that Apple is shifting iAd's engineering and sales focus away from campaigns integrated into iOS apps to messages supporting its new iTunes Radio streaming service. Earlier this month, Bloomberg revealed that while iAd staffers will continue to sell advertisements carried inside mobile apps, Apple is ramping up negotiations to secure brand partners to run iTunes Radio campaigns coinciding with the service's commercial launch later this year.
Apple will support iTunes Radio across the iOS platform as well as Apple TV and Mac. The service is available free, and it includes both audio and text ads. Subscribers to Apple's iTunes Match--which scans music library files and matches each selection with 256 kbps versions culled from the iTunes Store catalog and stored via the iCloud platform--may access an ad-free version of iTunes Radio: iTunes Match is priced at $24.99 per year.
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