The iPad and Online Advertising

First, read Ian Schafer’s excellent article over on Ad Age about this subject. Done? OK, now here’s some more detail on the operational implications of this new device on publisher and advertisers.

No Flash = Less Money

Suppose you’re a publisher with an active business selling premium ads on your site. Probably 90% of these ads are Flash. The iPad is a big hit and maybe your site is lucky enough to get promoted on the homepage or highlighted in a cool Apple TV ad. And maybe 5% of the traffic to your site starts to come from the iPad. What’s the implication on ad revenue?

If you were smart, you proactively targeted iPad-specific ads to the traffic to this device. This assumes your ad server allows this, which is unlikely in the short-term, but let’s be optimistic. Since there are very few iPad-specific ads and advertisers don’t like to be “burned out” with users through repetition of impressions, the likely outcome is that a) the iPad campaigns you sold under-delivered due to frequency constraints; and b) most of the iPad impressions went unfilled by paying campaigns. Net result: You lost money when consumers moved viewing from a traditional device to the iPad.

If you weren’t as smart, you did nothing special for the iPad. The result is that all those premium Flash campaigns that were supposed to run on your traditional website now ran on the iPad. Luckily, no one is dumb enough to allow a broken-plugin image to show in an ad slot, so instead of showing Flash in all those avails you showed “backup images” that are bundled with most Flash creative. You seem to have delivered to advertiser insertion orders, and everything is fine. Except, that results for the advertisers sucked, and (according to IAB guidelines) rich media vendors will start showing the number of impressions that were shown as backup images in their reporting. The net result is that your site will under-perform against sites without as much iPad traffic, resulting in less revenue.

Let’s Create an HTML5 Ad!

OK, no problem. We just need to stop using Flash to create ads (since it is proprietary and only works on desktops and is yucky overall) and switch to HTML5. Sure, sounds great.

So I’m a year out of my MFA program and I’m really, really trying hard to understand what the “timeline” is in Flash and how to do a “tween” and maybe next year I’m planning on figuring out how to use alpha channels. And did I mention I am seriously hung over from yesterday’s happy hour and under deadline to deliver creative for my client’s major launch? So you actually need me to write two completely different versions of my creatives, one for Flash and one for HTML5? Did I mention that based on the different sizes and publisher specs on the media plan that there are already 23 versions of the creative? So now I need to do 46 versions? And WTF is HTML5? How am I supposed to debug that? I’m just a designer, not a web developer!

It’s Results that Matter!

Look, in the end the advertisers and their agencies are going to do what is needed to follow the customers. If there’s a little learning curve for the creatives and media buyers to adapt to the iPad’s success, well that’s what it takes to get measurable results! You can measure the results using cookies, can’t you? It is pretty much table stakes in online advertising to use third-party cookies to measure how many users exposed to an ad buy or otherwise transact with your website, and since iPad is based around Safari that’s a no-brainer. No? No brainer? I didn’t know that Safari turns off third-party cookies by default! Across all Apple products? Really!? You can’t be serious?! So, in addition to creating brand new creative units (at huge incremental expense), I’m also going to have no way to measure reach and frequency or conversion results? Awesome!

But, It’s the Future!

Enough sarcasm. The reality is that online publishers and advertisers are going to have to deal with the coming Cambrian explosion of reading devices. This isn’t going to be easy and may throw into doubt many of the underlying operational assumptions of the online advertising business. Maybe the iPad will force these changes to the fore. I don’t know. But I do know, that the changes required to support advertising in this new medium will be so substantial that they will have a negative, rather than positive, short-term effect on ad revenue and ad effectiveness.

Comments from the Old Blog

  • bsaitz • 10 years agoapple has no idea about online advertising.. lynn & quattro have lots of work to do..ReplyShare ›
    • joesparks • 10 years agoAnd to think- at one time Apple QuickTime supported flash. They tried to treat it as just another media type like animated gif.. that did not work out so well. Things have never been the same between Adobe and Apple ever since Jobs and Gates introduced TrueType and made John Warnock cry in public