Apple carves out a new niche for paid ads on App Store

Apple has introduced a new paid ad slot for developers to promote their apps on App Store, a move that will expand the company’s ad business. The slot will be placed on top of suggested apps lists on the store home page.

The Cupertino-based company currently pushes app ad campaigns on App Store’s search tab where developers bid for prominent position. Now, they will have another location to place their ads.

Apple explained in a blog post that Ads on the Search tab are created using the assets developers have already uploaded to the App Store product page so keywords are not required for Search tab campaigns.

Similar to search results campaign, there’s no minimum spend for search tab campaigns. Developers can set campaign budget and add a daily cap to control the spending.

App developers will be charged based on ad cost-per-thousand-impressions model. The actual cost is determined by a second price auction, which calculates what a developer pays based on what the next closest bidder is willing to pay.

When a developer creates a search tab campaign or ad group, they’ll set a max impressions cost bid at the ad group level which can be adjusted anytime. Apple noted that an impression is counted each time at least 50% of the ad is visible for one second.

Apple’s move to expand its ad business comes at a time when it’s cracking down on apps that track users’ data without permission. The new App Tracking Transparency feature, which is rolling out in iOS 14.5 has invited criticism from Facebook as well.