Multiple app publishers have told me that Apple is quietly buying Google advertisements for high-value apps to collect possibly millions of dollars in subscription money. They claim that Apple is placing the announcements without the permission of the app developers and that Google won’t remove them.
The price tag millions of dollars in revenue lost. In addition, their campaigns have hefty advertising costs. They claim it’s a type of announcement arbitrage that is been going on for at least two years. Dating applications like Tinder, Plenty of Fish, and Bumble, media giant HBO, education and learning magazine Masterclass, and language learning provider Babbel are among the companies that have been impacted. The advertising does not say they are from Apple, and most people would mistake them for advertisements from the businesses and app publishers themselves that happen to land on the App Store. They do, however, have comparable tracking links with nearly identical specifications, indicating that they were all likely placed by the same agency.
“Apple is aiming to maximize their gains by driving in-app purchases through the Apple Store,” one bigwig told me, asking not to be identified for fear of reprisal.”Apple has worked out that they can earn further money off these developers if they direct users to the App Store to buy instead of going over the web.”
iPhone apps that sell subscriptions to ongoing services can take payments through Apple or charge clients directly on their websites if they’ve multiple ways of delivering the service. However, Apple takes a 30 share of the first year’s income and a 15 percent every year after that, If apps choose the normal way and charge users through Apple’s platform. Businesses like Amazon and HBO, on the other hand, can avoid the Apple fee and keep all of the cash if they sell an ongoing service on their websites.
When individuals subscribe to a service through an iOS app, they’re effectively becoming Apple clients. Apple doesn’t partake important information about them to the apps or businesses that run the apps for privacy reasons. That makes providing customer care, addressing difficulties, and resolving problems difficult.” The user experience is substantially worse,” one company’s marketing executive told me.”When you buy from a developer, they’ve got a relationship with you; when you buy from Apple, you are Apple’s client, not ours, and if you have a subscription problem, we can not help you.”
Likewise, prices climb when numerous parties contend for the same advertisement slots.
So, if Apple is buying advertisements for HBO Max to persuade HBO subscribers to purchase the service in-app, HBO will have to spend more than Apple to achieve the top place and high exposure. This raises the cost of customer acquisition, which is a big issue for high-growth businesses that rely on complex marketing models to balance customer acquisition costs with advertising budgets. One bigwig stated, “It harms the advertising. “Because LTVs ( lifetime value of a customer) is smaller, it not only costs more to promote, but you also can not spend as much. “Apple is not only profiting from developers; it’s damaging their bottom line. “As a result, there is a lot of skepticism in the request regarding Apple’s privacy standards, which limit how much data firms can use for marketing and how much data apps can acquire from subscription users.
One insider claimed, “Anyone who understands the fundamentals of arbitrage could invent this. “We all know what Apple is doing in terms of privacy is for its benefit. It did not feel well with me that they were doing this to developers in the background. it’s unethical.” How would you know whether a Google advertisement for an app is from Apple or a third-party app publisher? One indicator in the advertising thus far is the presence of the string “mttn” in a UTM parameter (data in a tracking link).
Another red flag the URL leads to the App Store rather than an app developer’s website.
