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The Built-for-Mobile Ad Space Heats Up: AOL Introduces Mobile App Install Native Ads

Written on
Apr 24, 2014 
Author
Richard L. Tso  |

ADOTAS – In the U.S. alone, there are more than 327 million mobile devices being used on a daily basis. And according to the Pew Research Center’s Internet Project, an astounding 91 percent of Americans currently own cellphones, with nearly two-thirds of consumers utilizing mobile devices to access the Internet.


Undeniably, mobile holds tremendous promise for an ailing publishing industry, and advertisers believe it will soon be the dominant screen to reach consumers. Up until now, brands and agencies haven’t really been building first for mobile, instead simply retrofitting ads originally designed for desktop viewing into mobile environments. Needless to say, this approach resulted in highly intrusive and ineffective mobile ad campaigns that garnered poor results and provided lackluster experiences.

“Advertising technology hasn’t been able to keep pace with the exponential growth of mobile the last few years – now on pace to account for more overall ad impressions than desktop by end of year,” said Chad Gallagher (pictured), director of mobile at AOL. “Users want ads that are more customized to the device and site they are on – the rectangle box at the bottom of the smartphone just doesn’t cut it anymore for advertisers.”

Things are about to change for the better. Today AOL Platforms (formerly AOL Networks) (NYSE: AOL) unveiled its new mobile download app unit that allows marketers to easily and cost effectively insert native advertising into campaigns across the mobile Web. The new native ad unit currently reaches 86 million users per month, according to comScore.

“We are finally moving beyond a Band-Aid approach to mobile and launching a scaled platform that is customized for each mobile site/app,” said Gallagher. “On the publisher side, this represents an opportunity to increase yield by 60% on mobile, which is an amazing opportunity when you take into account the scale of mobile.”

More clicks mean more revenue for publishers and more eyeballs for brands – something that native approaches are known to deliver.

“Native mobile ads are just better than mobile banner ads; they’re easier to read, less annoying, and we get fewer accidental clicks,” stated Tyler Davis, Partner at digital agency Chong + Koster. “So when our AOL team told us they’re rolling out native mobile ads to their quality publishers like HuffPo and TechCrunch, we were more than just excited; we wanted to be among the first advertisers to run these ads.”

Quietly over the last 4 months, AOL has been running AOL Native against its owned and operated properties, as well as across a handful of large third-party publishers. Preliminary metrics indicate the new ad units result in six times the conversions of smartphone display banners: Average conversion rates are between 0.8 percent and 1.2 percent, while AOL’s native units averaged 6 to 8 percent.  AOL will now offer its native ads to its more than 22,000 publishing partners and will go live within the next two weeks across all of AOL O&O – including TechCrunch, Engadget, Huffington Post, and AOL Mail.

The company is also working on integrating into exchanges, despite the belief that native exchange inventory for mobile is still relatively low volume.

“For our clients, this simply represents another format to drive performance,” Gallagher added. “For example, an advertiser could simply add text + image to their campaign, and now they will be able to run in native inventory in addition to everything else they do with us. The future of native on mobile is using technology to scale native globally.  That’s our No. 1 focus. Native can’t live in closed silos on a few sites; we need to use real-time technology to scale across global sites, customized for each publisher, but standardized in format for advertiser.”





Richard L. Tso is a reporter for Adotas and an avid writer covering the intersection of technology and advertising, fashion and music. With over 12 years of experience in the Advertising, Marketing and Public Relations industries, Richard has held executive positions at global agencies and technology companies and is founder of the interactive communications firm Pseudosound Consulting LLC. A classical cellist and painter, he believes that sometimes sound carries more weight than words. He is a graduate of Stanford University.

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