Mobile ad network AdMob has been one of the leaders selling ads for Apple’s (AAPL) iPhone, both on the mobile Web and in apps. In April, for instance, the company received 2 billion ad requests from iPhones and iPod touches, up almost 60X from 34 million a year ago.
But, reality check: The iPhone app store’s dramatic growth — coupled with a crappy economy — has meant that ad inventory supply has far outstripped demand, and AdMob hasn’t been able to get nearly as much for ads as it expected to last summer.
- AdMob says its cost-per-click ads bring in about 11 to 12 cents per click, or about a quarter of the 40-50 cents per click AdMob expected the market to settle at last July.
- AdMob says its banner ads, sold on a CPM basis — or cost per 1,000 impressions — are bringing in a $12 to $14 average CPM, or about 40% of the $30 “minimum” CPM AdMob set last July. (Targeting can bring those rates up.)
Again, blame a bad supply/demand curve, AdMob says. The company says it can fill about 80% of cost-per-click inventory, but just about 25% of banner inventory.
Meanwhile, AdMob is doing one thing right by making new iPhone ad units available, such as a search box that’s sold as a display ad. That could, for instance, be a way for Microsoft (MSFT) to directly add its new Bing search tool to some popular iPhone apps.