Apple expands app search ads in push to take on Google and Facebook

Apple is expanding search ads in its App Store to six more countries where apps are big business: France, Germany, Italy, Japan, South Korea and Spain. They join countries including the United States, Mexico, Canada and the U.K., bringing the total to 13 and escalating Apple's bid to win substantial ad revenue from tech rivals Google and Facebook. Apple only ventured into search advertising nearly two years ago, but its share of app-installation ad market has risen quickly, from 23rd place in 2016 to seventh last year and now third place, behind the duopoly. Apple Search Ads capture massive real estate on iPhone screens and have ridiculous conversion rates when compared to Google and Facebook. The company's ads appear at the top of the App Store after a user performs a search, meaning that someone who searches for the Target app may well see an ad for Amazon's app first, pushing the Target app halfway down the screen for good measure. Some 70 percent of iOS users are turning to the company's App Store to discover new apps, according to Apple. Apple's search ads also see a 50 percent conversion rate, Apple says. That seems borne out by data from one of Apple's marketing analytics vendors. Over the last 30 days, Facebook has returned a 31 percent conversion rate on app-install ads and a 0.54 percent click-through rate, the company says. Google had a 17 percent conversion rate and 0.7 percent click-through rate. Apple boasts a 53 percent conversion rate and 5.8 percent click-through. Part of the reason for the ROI is the extreme targeting that Apple deploys. The company only shows very targeted ads based on intent, which means that irrelevant results seldom appear even if an advertiser tries to buy them. App publishers will also often bid on their own apps, so a search for "Game of Thrones" will often return an ad for "Game of Thrones" at the very top. "Naturally, people will click on this," a person at the marketing analytics company said, also speaking on condition of anonymity. "The reality is, however, that if an organic result came up first, they probably would have clicked on the organic, unpaid result as well." Several of the countries Apple is expanding to are among the biggest markets for app downloads. According to a 2018 App Annie report, Japan downloaded some 9.5 billion apps from 2010 through 2017, followed by France (4.5 billion), Germany (4.1 billion) and Italy (2.9 billion), putting each within the global top 10. By comparison, the U.S. downloaded some 40 billion apps during the same time frame.

Apple expands app search ads in push to take on Google and Facebook

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