12/18/2013 12:06:29 PM
Do Advertisers Hold the App Monetization Keys and Could the Spigot Dry Up Due to False Positive Ads
app monetization, video ads, Vindico, Adweek
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App Developer Magazine

Do Advertisers Hold the App Monetization Keys and Could the Spigot Dry Up Due to False Positive Ads



Stuart Parkerson Stuart Parkerson in Monetize Wednesday, December 18, 2013
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Ok, I made up the term “false positive ads” that appears in the title of this article, you’ll understand what I mean in a moment. While the big ad money in mobile might be a recent smart device phenomenon, the source of much of that money is coming from long standing, traditional sources: large advertisers selling cars, razor blades, and dish soap, staples of our lives that generate large revenues for the companies who spend correspondingly large sums of money marketing their products. 

And while these budgets can be huge, they aren’t infinite and these companies want to see a return on their investment. And that’s why a recent article in Adweek might cause app developers depending on advertising for revenues to take pause. The well written article, kudos to author Mike Shields, provides some interesting numbers. Like quoting a comScore report that, while the audience for online video has only grown 4 percent over the past year, the number of video ads are up 205 percent. Sounds like advertisers are moving toward video ads, which are hot right now. Great right?

However, another report cited in the article throws some very cold water on online video ads. Quoting the report from Vindico, an ad serving company which says it tracks 40 percent of all video ads served on the internet, the company found that 57 percent of the 2.7 billion ads it tracked over a recent two-month period were not viewable. Say what? How does that happen? According to Vindico, it is a result of autoplay video running below the fold where people can’t see it. Sneaky huh? 

Well worth my newly minted term “false positive ads.” The article provides quotes from some of the companies that were potential culprits of the problem, and an interesting repeated tone is seen as to why the problem exists: scoring low on viewability could be because they are plugged into ad networks. Now the article doesn’t say ad networks are definitively the problem, but the hint of it is now out there in Adweek, a place were ad pros go for industry information. And so now I wrap it all up in a neat package for the app development industry. 

Its about credibility. The traditional Neilson ratings for TV were set up so that ad buyers could have some assurance that the eyeballs they are paying for are actually there. With app monetization moving largely towards free apps with in-app advertising or other in-app monetization strategies, any whiff of impropriety could scare off ad buyers. Which turns off the spigot and the money train goes away. 

Ad agencies are accountable and if the companies that contract with them to place ads are concerned about the value of their investment, you can bet they are going to go places where they feel comfortable telling their bosses, “yes the eyeballs are there.” And our experience has been that most mobile ad networks realize the importance of staying power; which means they have to run a clean ship, with products that deliver as promised and fortunately most do. 

What does it all ultimately mean? Probably nothing, the app industry is a money train that is running at full steam and its going to be hard to derail. But its definitely going to continue to be an interesting ride. To view the full Adweek article, visit the link below.


Read more: http://www.adweek.com/news/technology/number-onlin...