Apple makes more than $4 billion in ad revenue per year, but apparently, that is not enough for the Cupertino giant. The American phone maker is reportedly planning to put more ads to iPhones in order to boost revenue, says a new report from Bloomberg.
The report says that Apple wants to grow its ad revenue to “double digits” soon. iPhones already show ads in some stock apps such as Apple News and Stocks but it is now going to show more in the App Store soon. Apple Maps may start getting ads too similar to its biggest rival Google Maps. The App Store is “likely” to get ads in the Podcats and Books section.
Meanwhile, Apple has been a barrier against targeted ads from other apps. In 2021, Apple released a new feature for iPhones called App Tracking Transparency, which lets you choose if you want apps to show you targeted ads. Most iPhone users blocked targeted ads using this feature, which presented a major challenge to companies including Facebook, Peleton, Snap, and others.
Analysts predict that Apple is in the early stages of building a new mobile advertising platform which is going to be its next big revenue stream. The company has raised its recruiting efforts for the ad platform and also had a major presence at the Cannes Lions advertising festival in June.
The company’s ad business has been declining over the past few years due to the COVID-19 pandemic. The Apple Services business, which is primarily driven by App Store ads, has seen slower growth for multiple quarters and there has been a downturn in consumer spending as well. The analysts said:
Overall, we believe that at least 20% growth for Apple’s overall Advertising segment is attainable over the next few years.