Apple iAd cut its sales staff and is moving to a publisher-driven system, BuzzFeedreported last Wednesday. It's all in the hands of publishers now: creating, selling and managing iAd units.
So what went wrong when a tech giant decided to try its hand at advertising? Below is a brief history of the highs and lows of iAd, beginning with its introduction by Apple founder Steve Jobs.
The Good: iAd Makes Its Debut
"This is a pretty serious opportunity," Jobs said when presenting iAd in April 2010. Apple wanted to change the quality of advertising on mobile "to deliver interaction but also deliver emotion." The proposal was simple: with the acquisition of ad-tech company Quattro Wireless, Apple would sell and host ads and give developers 60% of the revenue.
Brands were enthusiastic about the in-app approach, emphasis on emotion and overall Apple seal of quality. "Unilever likened its move onto the iAd platform to its path-breaking advertising firsts like sponsoring the first commercial on British television, for Gibbs SR toothpaste, in September 1955," Stuart Elliott wrote inThe New York Times.
The Bad: It's Costly And Slow
To be first on the platform, Ad Age reported, marketers may have had to pay $1 million in media spending, a number that still seems high today. Still, Apple booked $60 million in iAd business weeks before its launch, and by August 2010, Citigroup, Disney and J.C. Penney were onboard with campaigns. Early complaints included Apple's tight control over creative that slowed things down (for example, the specs iAd made people use) and lack of transparency (people didn't know where their ads were appearing).
A few years in, some execs who came to iAd from Quattro Wireless left, including Quattro Wireless co-founder Andy Miller. Though there were strategy shifts and several price cuts, still the service didn't fulfill its potential, a fact that puzzled some.
Perhaps Apple's goals don't support ad-service growth. Last year, company CEO Tim Cook commented that Apple rejects the idea that customers should have to make tradeoffs between privacy and security, something potentially at odds with modern marketing's emphasis on all things data.
In the meantime, Facebook and Google pushed their ad solutions forward. Last year, iAd’s share of mobile display ad revenue was 5.1%, according to eMarketer. Facebook's share was 37.9%, and Google's was 9.5%.
What comes next? Some are saying Apple may be preparing for change of leadership. One thing's for sure: Publishers will get full rights to the revenue they generate with iAd.