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iAds and the Mobile Ad Space

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You probably have an iPod and may have an iPhone, but are you ready for an iAd?  As a marketer, how are you thinking about reaching mobile users?

Apple’s new iAd mobile advertising platform was announced in early April, but made a big splash again on Monday at Apple’s Worldwide Developers Conference.

Alongside the unveiling of the iPhone 4, Apple announced that major corporations were lining up to launch ads on the iAd platform this year.  Some $60 million in spend on the platform is committed for the second half of 2010 from big players like AT&T, Best Buy, Campbell Soup Company, Chanel, Citi, DirecTV, GEICO, GE, JCPenney, Liberty Mutual Group, Nissan, Sears, State Farm, Target, Turner Broadcasting System, Unilever and The Walt Disney Studios.

Apple’s press release on the iAd platform reads:

iAd, Apple’s new mobile advertising platform, combines the emotion of TV ads with the interactivity of web ads. Today, when users click on mobile ads they are almost always taken out of their app to a web browser, which loads the advertiser’s webpage. Users must then navigate back to their app, and it is often difficult or impossible to return to exactly where they left. iAd solves this problem by displaying full-screen video and interactive ad content without ever leaving the app, and letting users return to their app anytime they choose.

As an iPhone 3G user considering an upgrade to iPhone 4, I must admit I am more likely to click on a mobile ad if I know I can easily return to the content or app.  It will be interesting to see how these ads are received by users.

At first, I’m sure we’ll see great creative and some high click throughs.  But are we going to see compelling offers?  Or are these ads just going to be more about entertainment?  In the iPhone 4 demo, Apple showed a Toy Story ad that allowed the user to learn more about characters, watch video clips and even play a game within the ad.

We’ve heard that mobile ads are more about impressions now.  But the ads’ interactivity begs click throughs, and CTR performance is going to be important over the long run.  With banner CTRs falling from just above 5% in their heyday to current rates in the neighborhood of 0.1 – 0.2%, will we see the same CTR erosion in the mobile space?

Google is also getting in on the mobile advertising game with their acquisition of AdMob.  Can’t wait to see round 1 of this fight!  iAds are coming to a screen near you on July 1.

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