Friday, 28 August 2009

AdMob: building step by step

I noticed on GigaOm that AdMob announced its purchase of AdWhirl. It is an intelligent move from a growing company from whom we have come to expect little else. AdMob proliferated initially from a low value but hugely scaleable ecosystem which basically created an efficient clearing house for advertisers and publishers eager to explore the mobile space.

In reality these advertisers were those already active in the mobile space, arbitraging buying traffic from AdMob and monetising their inventory through various means including AdMob ads. Several businesses were built in similar vein on the desktop through Google. Quality was not high and eCPMs seldom cleared $1 but the poster children of AdMob's early evolution were social networks like Peperonity who had never seen higher than that anyway.

With the advent of the iPhone, AdMob saw (before anyone else) the opportunity for a new type of mobile ad which most people more commonly know as display - though I do not remember AdMob ever referring to them as such. The problem with display, even on a single platform, is that it is not as scaleable a business. Creative types get in the mix, agencies start to muddy the waters and all of a sudden there is a lot of grit in the wheels. AdMob needed to work a lot harder for its money and, as the market grew and people saw the opportunity, the market also fragments.

Now, AdMob has done three smart things all in one. One, it has bought in a dedicated Ad Aggregator and being 'in' means that there is no bridge between the user and AdMob, it will have the data it needs to target its ads more effectively. Two, it has bought a company specialised in creating an exchange of different ad networks (very similar to Google's model in the desktop space) and now can focus on providing the right kind of targeting information to those networks to maximise benefit for Advertiser and Publisher; it can focus on the day job again of being an efficient clearing house rather than a sales house. Three, by making it open source it is basically saying - he is an efficient ad exchange for mobile - it's free, feel free to use it - the more the merrier.

Each time I think AdMob has run out of steam, it makes another intelligent step and may yet make the mobile space its own.

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