Apple tests AI-powered App Store ads, similar to Performance Max.

Apple is taking cues from Google and Meta by experimenting with a new AI-powered way to buy ads for its App Store, according to two people familiar with the matter.

Apple has begun testing a new product with a small group of advertisers that automatically decides where to place ads in its App Store, similar to Google’s Performance Max and Meta’s Advantage+.

Apple’s current ad formats include two types of ads within the Search tab and on the search results page, “You May Also Like” ads that appear on app product pages, and those that appear on “Today” ads. Tabs appear when users first open the app. Store. In this new campaign type, advertisers enter their budget and cost-per-acquisition target, as well as the target audience and countries they want to reach. Then Apple’s algorithm automatically decides where to place the brand’s ads in the four available formats.

Apple has told advertisers it is conducting tests to see how it can improve the performance of its Apple Search ads, but one of the sources familiar with the matter said they expect the company to The new product will be officially introduced in the coming months.

Apple did not immediately respond to a request for comment.

Performance Max and Advantage+ have been a boon for Google and Meta, both of which regularly cite these products as key growth drivers on their earnings calls. Google says Performance Max delivers better results, though some advertisers are skeptical of the product because the company doesn’t provide a detailed breakdown of where their ads were served. MetaAdvantage+ discloses placement reports.

While Apple’s new tool appears to be limited to places within the App Store, mobile advertising experts said it could logically follow that Apple would eventually expand it to other properties.

“Any PMax-style automated tool by definition requires many different placement types of delivery value,” said Eric Seufert, an analyst, investor, and founder of Mobile DevMemo.

Seifert added that while he was skeptical that Apple would place mobile app install ads in its News and Stock apps — because they’re managed through a different advertising interface — it’s possible that a Performance Max-type tool Apple could use. Be a precursor to launching new ad spaces. on its other assets. Observers have previously speculated that Apple will soon bring ads to Maps, Apple TV+, and its Books app. Apple also recently launched a sports app, which could be another contender for new ad spots.

Apple’s advertising business is on track to generate $7 billion in revenue this year, up $1 billion from 2023, according to analysts at research firm Omdia. Much of that revenue comes from its App Store search ads, though it has recently made inroads into other areas.

Apple now offers sponsorship and other advertising integrations within its broadcasts of MLS Soccer on Apple TV. It has also made key hires in areas including adtech and TV ad sales, suggesting its advertising ambitions could be bigger, such as adding advertising tiers to Apple TV+ to take on rivals like Netflix and Apple. to follow.

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