Mobile Fix – Ad tech, Apple and app stores
In his latest Mobile Fix, Simon Andrews, founder of Addictive!, takes a look at the growing ad tech battlefield, the problem of discovering new apps and expectations surrounding Apple.
We all know how dominant GAFA is. But this one chart (below) from a new Comscore report on US mobile users emphasises how this plays out in mobile. Of the apps with the biggest reach, half are from GAFA – with Yahoo also performing well.
This reach is clearly a huge opportunity for advertising but until now only Facebook and Google have really focussed on this. But that’s changing. As we have mentioned, Apple has hired smart people and we expect a push for ad dollars around their music product once Beats is fully integrated. They had been gearing up for an ad supported iTunes Radio, but that now seems to be on the back burner outside the US.
Amazon has been hiring lots of smart ad people too – and in contrast to previous regimes when their smart ad people struggled to get advertising taken seriously by management – this time Amazon seems to be really gearing up to take on Google.
With the launch of Amazon Sponsored Links it is looking at how brands sold through Amazon and the Amazon Associates can use advertising across Amazon to drive sales. With all that purchase data this turns online ads into a new version of in store sales promotion – with the ability to measure the precise effect.
This scale and this data make them really attractive to brands and agencies. But so too does the fact they are not Facebook or Google.
Google probably suffers most as lots of ads that currently run on Amazon are Google Adwords and we should expect to see that revenue stream start to dry up.
The other huge advantage GAFA and (to a lesser extent) Yahoo have is logged in users so they have cross platform first-party data. The insight from this is really valuable and will probably lead to these players growing their share of the ad market. But getting and using the data requires good ad tech.
The huge reach of Google is complimented by the dominance of its ad tech – Doubleclick et al are used by a huge proportion of advertisers across all their campaigns and as such affect Facebook, Amazon and probably Apple. This irks many publishers and we can be sure that GAFA competitiveness means others would like to limit this dominance.
Facebook bought Atlas, the main rival to DoubleClick, for a knock down price last year – when Microsoft divested itself of what was left of its $6 billion buy of AQuantive. They have been quietly working in bring it up-to-date and plan to launch it in the coming weeks as a serious rival to the Google stack.
One of the models we use a lot in our strategy work is the Vertical Stack, where GAFA increasingly have proprietary products, services and tools right throughout their business. So it’s no surprise that this is extending to ad tech. It is vital that brands understand how their business intersects with GAFA and their stack, and whilst this adds complexity it also adds urgency. As agencies scramble to evolve their ad tech to gather data from the various vendors and get some insight, brands might ask who is looking after their interests.
It’s worth reading John Batelle’s thinking on this.
And take a minute to remind yourself of just how complicated mobile advertising is with this infographic showing what happens in .3 of a second to get that ad in front of the user. Hat tip @PaulbMobile
App store discovery
The other side of the Comscore chart above is how hard it is for an app from anyone outside the big players to get real reach. This piece gets into this in more detail using more of the Comscore data.
It shows that people spend the vast proportion of their time in their favourite app and – picking up the point we made last week – most people just don’t download new apps. If you want to use an app as part of your ongoing dialogue with your customers – which makes perfect sense – then you can use your other dialogue to promote your app.
But if you are one of the many start-ups chasing the next billion dollar valuation, you have your work cut out. One way to increase your chances of having a hit app is celebrity endorsement; TechCrunch looks at the Kim Kardashian app which has made $1.6 million in the first week – and at other celeb endorsements.
Apple expectations
With the stock price at an all time high, now the 8 September event has been announced the buzz is also at an all time high.
We wouldn’t get involved except it now seems the much anticipated larger iPhone and the iWatch may be joined by a new iPad. A much bigger iPad at 12.9 inches – so a similar screen to a 13 inch Macbook Air
Given everyone decided tablets were over a few months ago when sales growth slowed this may seem surprising, but a good piece by consumer tech guru Walt Mossbourne called In Defence of the Tablet explains just how well these devices have done and continue to do.
As people work out the use cases for their tablet and their smartphones – and as smartphone screens grow – there will be some substitution. And the renewal of tablets will be much less influenced by MNO contracts and the subsidised upgrades that drive so much of the smartphone growth.
RCKSCK
Last week we gave Fix readers a sample of our new RCKSCK project and encouraged sign up to the Friday Edit, which will be the first service from RCKSCK.
The App will enable you to save and share all those interesting places you find or hear about (no more bits of paper torn out of the FT Weekend or Monocle). And as well as browsing, you will be able to discover places around your location, based on your profile – which will be built through the things on RCKSCK you like, love and loathe.
It’s early days and we’re keen to get feedback and talk with prospective partners and with brands that want to connect with Urban Explorers. Feedback from last week was really useful and we’d love your help making this better. And please encourage friends to sign up for the Friday Edit too.
Our other side project, SkratchMyBack, is getting good traction in Manchester where we have been beta testing and we are now turning the heat up.
We are now looking for Charity partners across the country so we can help them recruit and manage volunteers. If anyone knows people who might be interested, please let us know.
This is an edited and abridged version of Mobile Fix – click here to read the full article on Addictive!’s website
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