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iAd for Developers Not So Effective After All?

Last month Apple launched the “iAd for Developers” program, a way for developers to advertise their application through the iAd infrastructure by enabling the users to click on a banner and get an App Store-like page, with options to download the app (from the ad itself), see screenshots and read the description.

The iAd for Developers campaign comes at $0.25 per click (unlike iAd’s standard $2 per click fee) and, according to Apple, it should be the best way to drive a huge amount of traffic to your application. Admittedly, it sounds like a great idea: you don’t have the leave the app you’re currently in to buy another app, the system is smart and targets that app based on you. For small developers, this could be a great source of revenue at a rather affordable price.

Developer David Smith of Cross Forward Consulting says it’s not that great, though. Actually, he says that his experience with AdMob (Google’s ad system) has been better than his first iAd campaign. AdMob is cheaper and generated more CTR, iAd generated many impressions but a very few downloads in return.

“From August 19 through August 25 I ran a campaign on the newly released iAd for Developers platform for our Audiobooks Premium app. The results were, to say the least, disappointing. For all the promise of selling your apps directly within an advertisement, it appears that so far this is not a viable way to drive traffic and create an economically sustainable promotion. For $1,251.75, my campaign generated a total of 84 downloads, thus a Cost Per Acquisition (CPA) of ~$15. For a $0.99 app, those economics just can’t work out.

The disappointing results of the campaign don’t surprise me. I have tried just about every advertising platform around and have generally found none of them to be demonstrably effective. I think that this stems from the fundamentals of why people buy apps. I believe most people buy apps based on receiving a recommendation, either directly from word-of-mouth or indirectly by their position in the Charts. There is no way to realistically replace either of these recommendation systems by throwing money at the problem.”

You can read the whole report over at David Smith’s website. Developers, did you try Apple’s iAd for Developers? We’d be interested in hearing from you.

[via MacRumors]

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