Adidas Drops iAd over Apple Control -- What a Mistake

There's a new scuttlebutt on the Apple (AAPL) iPad mobile ad front. Reportedly, Adidas (ADDYY) pulled a $10 million campaign because Apple rejected the creative concept three times.

It's not as though anyone should be surprised that Steve Jobs would exert the same amount of control as he does with anything else connected to Apple. And of course that is going to tick off large companies. But walking away isn't necessarily the smart move, because Adidas and other companies that drop the iAd program will miss a chance to learn something they think they know but don't: how to market.

Much of the attention people have paid to iAd has been on how Apple was trying to freeze out advertising competitors. By removing restrictions that seemed to target Google (GOOG), Apple has greatly lessened that issue. My BNET colleague Jim Edwards thinks that Apple is blowing its online ad competition with Google. Clearly the approval process has drastically slowed how long it takes for an ad to actually hit.

However, lets look at a different angle. As I've mentioned before, there are significant benefits that Apple control over iAd could offer high tech companies and advertising. The one point I didn't make then was that practically any company could learn a lot about marketing from Apple and Jobs.

The company has had some of the most clever and effective advertising in the world. You could argue that the creative for the most memorable spots, including the famous 1984 ad during the Super Bowl of that year, was the product of ad agencies. I'd agree. However, Apple chose the agencies, recognized the validity of the campaigns, and made its bet on them. Furthermore, I'd be mightily surprised if Jobs didn't have significant input into any marketing campaign for the company.

So Adidas wants to pull a $10 million campaign because it is annoyed and insulted that Apple turned down its creative concept three times? This is the Adidas with a direct history dated to 1947 that has a third the market cap and roughly half the annual revenue of Nike, which is its junior by 27 years. Not to dismiss what the company has done, but clearly it doesn't have the marketing Midas touch.

Apple's marketing prowess (and I include product design in that) has turned it into an immensely valuable company and brand. Not only it is generally good at marketing, but the company has proven that its understanding of its customers is astounding. What other company regularly gets people to wait on line for hours to make a purchase? I don't care what you want to sell these people, when you reach them on an iPhone or iPad, they belong to Apple, and no one else knows better how to influence and interest them. Refuse to listen to Apple when it tells you what will or won't work, and you're a buffoon.

Apple would get nothing out of a failed iAd campaign, so if it keeps rejecting an ad concept, there is probably a good reason. However, companies like Adidas aren't applying pure rational analysis. This becomes an issue of ego. How dare Apple tell me that my concept isn't acceptable! If you've ever worked in creating marketing materials for a large company, and I have, you quickly learn that concepts get watered down, execution dumbed down, and the potential benefit from virtually any campaign stomped down. From middle-level manager to top executive, relatively few are really good at what they do. And only the ones with some ability seem genuinely willing to learn.

My guess is that some other big names will drop out of their iAd campaigns -- until the results for those who are left begin to come in and it's clear how well they have paid off.


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