What does Apples’ Poor iAd Performance Mean?

Some would argue that Apple’s iAd initiative has failed to get significant traction, and might wonder whether it means anything particular, other than that Apple has not immediately been able to show its ability to reshape yet another industry. One way or the other, Apple has not shown sufficient value to get many advertisers to move budgets.

Maybe the issue isn’t necessarily Apple’s prowess in the advertising business. The mobile advertising business remains quite small by overall industry standards. Of the possibly $600 billion U.S. advertisers spent in 2010, about $48 billion was spent on all forms of digital media.

Marketers invested a total $47.6 billion in digital advertising and marketing in 2010 according to the Jack Myers Media Business Report. 2020 Vision: Media, Advertising and Marketing Economic Health Report 2000- 2020.

U.S. mobile advertising spend was estimated at $743 million in 2010, according to eMarketer. That is expected to reach $2.5 billion by 2014, but that is a small number in the advertising market. Some estimate the mobile marketing market already is bigger than that, but most think the mobile ad market still remains diminutive.About one online marketing dollar in every five spent in 2010 went to a mobile campaign, says Borrell Associates, one of the more-robust estimates.
By 2015, the mobile share will have grown to almost two of every three dollars spent, according to Borrell Associates. See http://www.mobilemarketingandtechnology.com/2010/toppost/mobile-advertising-will-be-23-of-total-online-spending-by-2015/.


The Jack Myers study pegs the digital total spend at nearly eight percent share of all marketing communications investments in 2010, which were reported by Myers at $601 billion. That total includes all advertising, trade and consumer promotion, event and direct marketing, and public relations, though, and some would not include PR spending in the advertising total, nor good portions of event marketing.


Perhaps the biggest upside could come if mobile advertising comes to be seen as the best form of local advertising, rather than national campaigns. Google would like that, even if Apple probably would not.

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