Is AdMob the New AdWords?

I’ve been meaning to write about AdMob for a couple of weeks, but 3GSM and a skiing holiday got in the way. So here goes.

AdMob is a pay-per-click marketplace for mobiles. Think Google AdWords for phones – yes, it’s that deliciously simple.

Publishers of any website optimised for mobile viewing can join the network free. And Admob run text-based ads on their site, whenever viewed by a mobile and share revenue. In other words, for a publisher, it’s all upside.

For advertisers, you bid to place your ads on sites within the network, on the pay-per-click basis that has been so effective on Google and others. Pay-per-click isn’t quite payment by results, but it’s the next best thing and I’d argue that clicking on a link on your mobile is expressing a stronger intent to purchase, than doing the equivalent on a PC. This is mainly as it requires a little more effort and the connection probably won’t be quite as fast – today anyway.

With a minimum campaign commitment of only $50 dollars, there’s no real risk for advertisers, so my guess is that many will be giving it a roll.

Omar Hamoui, AdMobs founder, was inspired to come up with this model from his experience of being an independent application developer. His Fotochatter application, that I reviewed here back in June found it hard to get to market without spending mega-bucks on marketing or being scalped by the operators, assuming it was even fortunate enough to get their attention in the first place.

The AdMob solution means that mobile content and application providers can target potential purchasers direct and by phone type and geography. As an example, if your application only works on Nokia phones on MIDP 2.0 devices in Europe, your ad won’t be served to anyone else.

While this makes perfect sense for the niche (but still billion dollar marketplace) of mobile content and applications, the wider question is whether AdMob might make sense for advertisers with less obvious direct relevance to mobile phones. Would it work, for example, to invite people to click through and watch the Honda “Choir” commercial (it’s brilliant if you haven’t seen it!)?

The answer to this is yes and no. From a pure marketing point of view, the commercial is great Advertainment and has had a million views over the web already. I have no doubt that many people would be happy to watch it on their mobiles. But the worry highlighted by my fellow MobHappy blogger, Oliver Starr, writing at MobileCrunch is the cost to the viewer. In this case, downloading a 2 minute ad could well cost a significant amount in data charges from your operator and who wants to pay to receive advertising, no matter how entertaining and slick?

I think Oliver certainly has a point here and at the very least, I’d expect click-throughs on this kind of ad to be suppressed. This would be especially the case if the advertiser followed good sense and warned the mobile user in no uncertain terms that their phone bill may well be about to be pillaged!

Oliver had a wider concern about the mobile user incurring additional cost when publishers run AdMob ads. While it’s only a matter of opinion, I disagree with him on this issue. I think if you visit a site on your mobile, you accept the data charges of viewing that site, with or without the addition of few extra words, which could as easily be extra copy, as advertising. If you then click through on an ad, you’ll know you’re incurring data charges and it’s your choice. But if you want the ringtone advertised, you’d incur those data costs anyway, when you went direct to the content retailer’s website.

So, AdMob seems to be a great idea for advertisers and publishers. Is it good for the mobile user? Frankly, I don’t accept that all advertising is a bad thing and neither do the millions of people who click on AdWords every day. Provided it’s relevant to my phone, helps me find stuff I wouldn’t know about and is subtle, easily ignored and optional to interact with, I think it’s on balance a good thing. And from the initial conversion rates claimed on AdMobs’ site, it seems than many users are already participating and benefiting.

AdMobs’ greatest opportunity and threat is to grow quickly enough before some big player decides to take the market for themselves. So I hope Omar is prepared for a rapid take off.

I’d be interested in your views, as always. Is this a great idea or is there a fatal flaw? What have I missed?

[tags]admob, omar hanoui, adwords, pay-per-click, mobile advertising, admobs[/tags]

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