This bizarre mental image was the take-out message of a report written by Kate Kaye and published by Advertising Age (AdAge) this week, claiming that Apple’s lack of thundering success in the iAd advertising space was all its own fault.
As MacRumors notes, Apple’s earnings in the US from mobile-ad revenue hit the US$258 million mark last year, which sounds healthy enough, until you measure it against the revenue streams enjoyed by such rivals and contemporaries as Google (US$3.98 billion) or Facebook (US$1.53 billion).
Apple is world renowned as the company that knows how to make a profit, so why is it lagging behind in this particular space?
AdAge has some ideas. To begin with, it’s swift to point out the difference between operating in the B2C (business to consumer) space and the B2B (business to business) space. And it believes Apple isn’t alone in this. Amazon gets put under the spotlight too.
Both companies, says AdAge, are guilty of dragging their feet when it comes to the relationships with media buyers. “Advertising sales are a tough slog for both – and for a lot of the same reasons. Media buyers say they are slow, cocky and downright stingy,” writes Kaye. “Both take too long to develop ad products. Amazon’s sales approach is too pushy; Apple is too reticent to foster relationships. Most frustrating: neither is willing to cough up enough of the consumer data that attracts advertisers to them in the first place.”
Ah, there’s the nub of it. Media agencies aren’t happy, because they see companies like Apple and Amazon sitting on gold mines of data that they could use for targeted marketing, but the tech giants are unwilling to share it.
As TUAW points out, Apple has access to unprecedented amounts of personal information about its customers – “addresses, geolocation information, app, music and video purchase histories, and all the assorted metadata that comes with it”.
Hear that dripping sound? It’s salivating media agencies. And that gnashing sound? That’s those same agencies wearing down their molars in frustration at not being able to leap into those mounds of data and start devouring.
What’s stopping them? Well, Apple’s data collection doesn’t come from online cookies, forcing advertisers to actually approach the company cap in hand and ask for specific breakdowns as and when they want them.
And this they’re willing to do, because they know just how extensive Apple’s customer information is. ”[Apple's] one of the best in terms of data quality and accuracy… but I think Google is a little more open,” Dan Grigorovici, co-founder of mobile-ad firm AdMobius, tells AdAge.
This is why major companies like McDonald’s, Nissan and Procter & Gamble were first in when it came to signing up to advertise on iTunes Radio.
But why is Apple so reticent at sharing its sandbox? Is it purely its high regard for the privacy of its customers?
It’s true that the Cupertino, California company boasts a Commitment to Customer Privacy document, that spells out how Apple simply doesn’t store customer information. The commitment was posted in response to the Prism situation in the middle of last year, when Apple was among a group of technology companies “accused of indiscriminately sharing customer data with government agencies”, according to the document.
It goes on to say, “Apple has always placed a priority on protecting our customers’ personal data, and we don’t collect or maintain a mountain of personal details about our customers in the first place. There are certain categories of information which we do not provide to law enforcement or any other group because we choose not to retain it.”
There’s also the school of thought that, for Apple, “advertising is an afterthought, a blip on the balance sheet… an ad is an impediment if it distracts a consumer from the ‘buy’ button or mucks up a beautiful mobile app,” says AdAge.
But perhaps the company’s reticence to really leverage its users’ personal information by sharing it willy-nilly also owes something to the JE – the Jobs Effect. “When introducing iAds in 2010, Apple founder Steve Jobs said most mobile advertising ‘sucks’,” notes AdAge.
And this discomfort seems to have permeated throughout Apple’s experience in the space. AdAge says that, over the last four years, the company has ‘rebooted’ its ad-selling efforts more than once, most recently when it “added iTunes Radio to its arsenal”.
But it’s still nowhere near as open and liberal with its data as a company like Google, which is what led one ad exec to utilise that curious image we referenced in the headline. “Apple’s refusal to share data makes it the best-looking girl at the party, forced to wear a bag over her head,” the unnamed executive told AdAge.
What do you think? Are you happy that Apple isn’t passing on the details of just how many series of Game of Thrones, Breaking Bad and Dexter you ordered from the Apple store last year? And where you were when you did it?
Or do you think the Cupertino Colossus could grow even bigger if it relaxed a little and sold your info to the highest bidder?