• by Jack Loechner , Staff Writer @mp_research, August 28, 2012

Following on yesterday’s Research Brief on connected TV ad preferences, a new study from Harris Interactive on behalf of MediaBrix shows that only 28% of Facebook users prefer to see standard banner ads in Facebook apps and 72% prefer to see immersive and interactive ad units.

Additionally, 40% of smartphone owners prefer to see standard banner ads in mobile apps while 60% prefer to see immersive and integrated ad units. Immersive and integrated ad units include those that offer people virtual rewards or currency and interactive video ads that occur during natural breaks in the app or game.

The survey findings, says the report, indicate that there are inadequacies in the way that social and mobile developers are monetizing, and reveal that the digital advertising industry needs new creative advertising formats for social and mobile platforms to meet consumer preferences.

According to the report, 33% of Facebook's one billion users say they have used an app on Facebook in the past twelve months and 65% of Facebook app users say they have played a game on Facebook in the past twelve months. According to recent figures from The Wall Street Journal, more than 45 billion apps have been downloaded, with free and paid apps for the Apple and Android platforms registering explosive growth.

The survey results also reveal consumers' preferences towards video advertising in social and mobile apps. According to the survey:

• 37% of Facebook app users prefer to be shown pre-roll ads in Facebook apps
• 63% prefer to either initiate the video ad or have it shown during a natural break in the game or app
• 38% of smartphone owners prefer to be shown pre-roll video ads in mobile apps
• 62% prefer either to initiate the video ad or have it shown during a natural break in the game or app

Tamara Bousquet, executive media director, MEA Digital, says "... people are turned off by standard online advertising... in social and mobile environments... "

Social and mobile app users prefer free apps that are ad supported. According to the survey:

• 87% of Facebook app users prefer free Facebook apps versus 13% that prefer paid apps that contain no advertising
• Of those Facebook app users that prefer free Facebook apps, 83% prefer to keep apps free with relevant advertising that appears during natural breaks in the game or app, while 17% prefer to keep apps free by making in-app purchases

Also according to the survey:

• 61% of smartphone owners prefer free mobile apps and 39% prefer paid apps that contain no advertising.
• Of the smartphone owners that prefer free mobile apps, 88% prefer to keep apps free with relevant advertising that appears during natural breaks in the game or app and 12% prefer to keep apps free by making in-app purchases, including virtual goods or virtual currency.

The report concludes by suggesting that since “... social app and mobile app developers cannot continue to rely on standard advertising patterned after web-based models as a way to monetize their apps... they should incorporate immersive advertising units to monetize and... to engage consumers... (in keeping) with their preferences... “

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