The amount of money spent on advertising on the iPhone and iPad has decreased by 32% since its peak in 2021. While advertisers split their expenditure 56% to 44% on favour of Android in early February, the breakdown was 70% to 30% in mid-June.
As a result, the profitability of Android apps is increasing.
Apple’s new iOS 14.5 update effectively deprecated the IDFA, Apple’s advertiser identification, by requiring consumers to opt-in. This makes mobile advertising more secure and private, but it also makes it more difficult to track and value. Advertisers began transferring dollars to Android — which is still fully quantifiable — around the same time as Apple launched iOS 14.5: the week of April 26.
According to AdLibertas, Android ad rates have now caught up to and surpassed iOS ad rates for the first time ever as a direct result of the influx of additional marketing expenditures. As a result, Android app monetization has increased significantly: According to AdLibertas founder and CEO Adam Landis, the 90-day predicted value of new users for Android apps increased 2.5X in June over April.
Even if it’s only transitory, it’s difficult to overestimate how significant this is.
One of the most fundamental misconceptions in mobile marketing over the last decade is that marketing on iOS is more expensive since iPhone and iPad users and customers are more valuable than Android users. That is no longer the case, at least not at this point in history.
There are a few things to keep in mind.
There was most certainly a build-up in iOS marketing before the release of iOS 14.5. Knowing that the “free IDFA party” was coming to an end shortly, app developers and marketers likely spent more freely in early 2021 than they would have otherwise. The pendulum is likely to swing back in favor of iOS as marketers alter their growth methods to accommodate for new ways of tracking and valuing mobile customers that take advantage of Apple’s SKAdNetwork architecture and other features.
It’s basic math: the average iPhone purchaser spends $400 more than the average Android purchaser.
As a result, they have more money and are more valuable to advertising.
If this implies a significant shift in marketing expenditures and profitability by platform — even if the balance shifts back to iOS — it might have long-term implications for developer investments on both Android and iOS. To put it another way, if you can earn more money on Android than you can on iOS, you’ll be more likely to release Android apps. Even a little change that enhances Android profitability by 20% or more will have an impact on where app developers and publishers put their money.