February 19, 2014
Ad Agencies Disheartened That Apple, Amazon Protect User Privacy
Lee Rannals for redOrbit.com - Your Universe Online
Ad Age interviewed people from Apple, Amazon and some advertising agencies and marketing services to find out how the companies are faring in this market. Essentially, the report discovered that both Apple and Amazon think of advertising as more of an afterthought.
Unlike websites and free apps, Apple and Amazon provide products, so advertising is not their key stream of revenue. According to Ad Age, Apple’s total revenue is $171 billion -- of that, $257 million is US ad revenue. Amazon makes a little more than apple on US ad revenue -- totaling $614 million, despite only pulling in $74 billion in total revenue.
In the midst of worries about customers data being shared to the authorities and NSA sneaking into phones, Apple has made it clear that it will not be sharing its collected data with advertisers. The company has made it clear that it only plans to use customer data to better the experience rather than the ad.
Apple gathers names, addresses, geographic locations and app and music purchase history, all of which would be a treasure trove of data for an advertising agency to get its hands on.
“However, its user tracking and ad targeting are not cookie-based, meaning agencies can't do automated buys via their cookie-centric trading desks, which allow them to mesh lots of data from different sources,” Ad Age wrote. “Instead, they have to go to Apple, ask to reach a given audience and, well, trust Apple that it will deliver it.”
Google works the opposite of Apple, using its collected customer data to profit on the consumer. Google ads track webpages a user has searched for or visited, allowing it to display more relevant ads based on the customer’s Web browser history. However, Apple and Amazon refuse to do business the way Eric Schmidt and his megacompany have.
"It'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, told Ad Age.
Cary Tilds, chief innovation officer for GroupM, told Ad Age that Apple doesn’t even have official sales targets for its ad business.
"It's not their main focus to tell everyone in the world how amazing advertising in iAd is," she told Ad Age. "It's just not as loud."
Ad Age points out that Amazon has prized data on its customers, including transaction intel about what books, music and devices a customer has purchased. However, Amazon isn’t playing ball with the advertisers either.
“Its unwillingness to share that sales data is particularly irksome to consumer-product-goods advertisers, which are accustomed to getting this kind of information from bricks-and-mortar retailers,” Ad Age said.