April 29, 2010

Apple Could Charge $1 Million Or More For iAds

Companies who want to take advantage of Apple's new iAd advertising platform for the iPhone and iPad will have to pay a hefty price for the privilege, according to the Wall Street Journal. reporter Emily Steel has learned that the company could charge up to $1 million to place an ad on their mobile devices, and might even be considering a price tag of $10 million for those who would like to have their products featured during the application's launch.

Similar mobile deals typically cost no more than $200,000, Steel noted.

"It's a hefty sum," Phuc Truong, managing director at Mobext, a mobile marketing business who has worked with Sears, Choice Hotels, Amtrak and Volvo, told the Wall Street Journal on Wednesday. "What Apple is trying to do is certainly above and beyond what's been done in the past."

The ads will be less like traditional commercials, and instead will be more interactive in nature, claims Steel. "When a user is in an application, an animated banner ad appears on the border of the screen, along with an iAd logo. If the user taps on the ad, it expands across the screen, displaying a video, an interactive store locator and exclusive offers at local stores, among other features," she said.

Despite the cost, iAd campaigns would have a handful of advantages over more traditional ad programs. For one, there is an existing user base of over 85 million individuals who have already purchased the Apple-created mobile devices, according to Steel. Furthermore, she notes that marketers can "target ads to groups of users based on consumers' download preferences" or location.


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