Apple is taking a cue from Google and Meta by experimenting with a new AI-powered way to buy its App Store ads, according to two people familiar with the matter.
Apple has begun testing a product with a small group of advertisers that automatically decides where to place ads within its App Store, much like Google’s Performance Max and Meta’s Advantage+.
Apple’s current ad formats consist of two types of ads within the search tab and on the search-results page, “you might also like” ads that appear on app product pages, and those that appear on the “today” tab when users open the App Store. In this new campaign type, advertisers enter their budget and cost-per-acquisition target, as well as the audiences and countries they want to reach. Apple’s algorithm then automatically decides where best to place the brand’s ads across the four available formats.
Apple has told advertisers it’s conducting the tests in an effort to learn how it can improve the performance of its Apple Search Ads, but one of the people familiar with the matter said they expected the company to officially introduce the product in the coming months. This person was granted anonymity because they were not authorized to speak publicly about the program.
Apple didn’t immediately respond to a request for comment.
Performance Max and Advantage+ have been a boon for Google and Meta, which both regularly reference those products on their earnings calls as key growth drivers. Google says Performance Max drives better results, though some advertisers are skeptical of the product because the company doesn’t provide detailed breakdowns about where their ads ran. Meta does disclose Advantage+ placement reports.
While Apple’s new tool appears to be limited to placements 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, needs many different placement types of deliver value,” Eric Seufert, an analyst, an investor, and the founder of Mobile Dev Memo, said.
Seufert added that while he was skeptical Apple would place mobile app-install ads in its News and Stock apps — because they’re managed using a different ads interface — a Performance Max-type tool could be a precursor to Apple launching new ad placements in its other assets. Commentators have previously speculated that Apple would 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 ad business is on track to generate $7 billion in revenue this year, up $1 billion from 2023, according to analysts at the research firm Omdia. Most of that revenue is derived from its App Store search ads, though it has recently made progress in other areas.
Apple now offers sponsorships and other ad integrations within its broadcasts of Major League Soccer games on Apple TV. It has also made key hires in areas including adtech and TV-ad sales, which suggests it may have bigger advertising ambitions, such as following rivals including Netflix by adding an advertising tier to Apple TV+.
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