“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
A recent job listing for a “Senior Product Manager, Demand Side Platform – Ad Platforms” has created many headlines and sparked wild discussions among industry observers: Is Apple secretly making a big move into ad tech?
Since Apple has not officially confirmed its intention to build a demand-side platform (DSP) or the context of the job ad, we can only wonder about the scope and strategy.
Is Apple the arch enemy of modern advertising?
For years, Apple has had a tough stance on privacy protection and can be seen as the pioneer of walled-garden mentalities. Many ad tech companies also blame Apple for creating unnecessary headwinds for their business because of the impact of Intelligent Tracking Prevention (ITP) and AppTrackingTransparency (ATT) features on their revenues.
Even almighty Meta estimates the latest iOS operating system privacy changes will decrease company’s sales by about $10 billion in 2022.
However, while Tim Cook has supposedly mocked Google and Facebook for their ad-focused business models, being pro-privacy and anti-tracking does not exclude the possibility of offering effective advertising. In fact, Apple has made money with advertising for years, including a previous attempt with premium programmatic targeted ads.
Apple’s ad tech history
In 2010, Apple actually tried taking on Google and Facebook when it introduced iAd.
Steve Jobs launched the in-app advertising platform and reportedly set out with the bold ambition that Apple could capture 50% of the mobile ad market. Initially, iAd was a self-serve platform, but in 2014 Apple partnered with Rubicon, AdRoll, MediaMath, The Trade Desk and others to offer programmatic ad selling.
Apple’s return to the ad tech table?
Why Apple discontinued iAd is open for debate.
Some say iAd failed because Apple didn’t share enough data with advertisers who want targeting, analytics and attribution. Apple also demanded much higher CPMs than the competition. So other DSPs offered more data and were also being more cost-efficient. During the early days of iAd, ad buyers were required to spend a minimum spend of $1 million to use the platform.
In January 2016, I made predictions about which ad tech companies may dominate in the long term.
The rule of three, as I referred to it, dictates that most markets end up with three key players (although some may have two or four). I speculated that, in addition to Facebook and Google, Amazon and Apple were the top contenders for the third spot.
But five months later, Apple announced it would abandon iAd. Today, Amazon has secured a top position in the digital ad market.
Battle of the walled gardens
In the past, Apple has been critical of monetizing personal information, but not the idea of serving ads.
Back in 2016, one reason Apple forewent its attempt at an ad platform is because it lost its appetite to vie with the competition.
But the situation seems different now.
With the global push for privacy regulations and the phasing out of thirty-party cookies (albeit with a delay on Google Chrome), Apple’s ad options look much more attractive in 2022 than they did in 2016. Not to mention its own rollout of ATT, which some argue give it an advantage in the ad market and could have been a strategic move to weaken the competition before reentering the ad business.
After introducing iOS 14.5 last year, Apple saw a significant increase in revenue coming from its Search Ads business and may now be anticipating a revitalized income opportunity. Apple has an advantage in a first-party data world and can learn from the strategic mistakes (e.g., confusing and too extreme pricing) it made the first time.
And now, based on its job posting, it appears Apple wants to hire someone who will “drive the design of the most privacy-forward, sophisticated demand side platform possible.” With Google’s recent (and second) third-party cookie delay, maybe it’s going to take a company like Apple, with a track record of technical innovation, to develop the next privacy-centered targeting solutions for digital advertising.
In any case, catching up with Google, Meta and now Amazon will be hard. And there are many other global contenders – all tech companies – making their own moves.
Only time will tell who the final three ruling players will be. And who knows, maybe we’ll end up with two to three main players for each vertical: social, search and streaming.
We’ll have to wait and see as the titans duke it out.
Follow AdExchanger (@adexchanger) on Twitter.