According to some latest reports, Apple is quietly buying Google search ads for high-value apps on the App Store. On Apple’s this decision, some developers are not happy as it’s hurting their revenue.
Multiple app publishers have told Forbes that Apple is “secretly” buying Google ads that direct users to an app’s App Store listing, rather than the developer’s website.
Apple Is Quietly Buying Search Ads for Many App Store Applications
“Apple is trying to maximize the money they’re making by driving in-app purchases that people buy through the Apple Store,” one source told Forbes. “Apple has figured out that they can make more money off these developers if they push people to the App Store to purchase there versus a web flow.”
According to the report, apps that have been advertised in Google searches include Masterclass, HBO, Babble, Tinder, and Bundle. The ads themselves don’t disclose the advertiser, though they all have nearly identical tracking parameters — likely indicating that a single entity is purchasing them.
It is currently unclear whether Apple was indeed the purchaser of the ad spots or not. It’s likely based on the fact that the app makers did not purchase the ads and that the ads go straight to an App Store link.
Some developers told the publication that the ads could be hurting their businesses because of the 15% to 30% cut that Apple takes of the app and in-app purchases.
An average user who clicks on an ad might not know that the developers didn’t place the ad. If a new user signs up through the App Store instead of the app’s website, the subscription is subject to that 15% to 30% cut.
“You’re building your growth based on what you think a customer is worth, and if a customer is worth 30% less, your margin is gone,” said one source who chose to remain anonymous for fear of retaliation.
Additionally, the report notes that the ad spots are making advertising more expensive for the actual developers of the app. That’s because prices rise when multiple parties bid on the same ad slots.