Despite only launching in late July, one developer has questioned whether Apple's iAd for Developers initiative offers any benefits for the studios signed up for the service.

The venture enables developers to purchase in-app App Store banner ads in other titles that users can click without leaving the app in question.

However, after trialling the set up for one week, David Smith of Cross Forward Consulting claims his app – Audiobooks Premium, priced at 99c – suffered especially low click-through and conversion rates.

Developer diary

"From August 19 through August 25, I ran a campaign on the newly released iAd for Developers platform for our Audiobooks Premium app," Smith says in a blog post on the firm's website.

"The results were, to say the least, disappointing. For all the promise of selling your apps directly within an advertisement, it appears that so far this is not a viable way to drive traffic and create an economically sustainable promotion."

iAd for Developers sets itself up as a cheaper alternative to the standard iAd set up, taking 25c per click rather than $2 per click standard advertisers are charged.

However, in Smith's view, it still isn't economically viable for the majority of studios.

Money matters

"For $1,251.75, my campaign generated a total of 84 downloads, thus a Cost Per Acquisition (CPA) of ~$15. For a 99c app, those economics just can’t work out."

Smith says Audiobooks Premium was chosen because it is the developer's most successful app, which – in his view – eliminates any doubt that the campaign was failed because the app in question isn't any good.

However, average downloads for the first four days came in at 17, with Smith tempted to pull the plug on the promotion there and then.

"[I] was convinced by the Apple Reps to give it a couple more days at a lower daily budget to see if their targeting algorithms could improve things with a few more days of data," he adds.

"That didn't really go well."

All aboard AdMob

Indeed, downloads dropped to 9 on the following day, and 6 within the app's final 24 hours – a rate that does not compare favourably to rival ad network AdMob, in Smith's view.

"AdMob is 6.25 times cheaper than iAd, and surprisingly had a CTR (click thru rate) that was 5.5 times better," Smith claims after running the same banner ad on the Google-owned ad network.

"This surprised me given all the marketing about how Apple believed that their putting an iAd badge on their advertisements would induce a level of trust and excitement with users.

"I think that Apple has found itself falling foul of exactly the same problems they called out when the unveiled iAd," Smith concludes.

"The ads lack engagement and emotion. There is nothing to draw the user in."

You can read his fill account on Cross Forward's blog.