What the Apple Watch means for advertising

Marketers face a real challenge in finding ways to advertise effectively on the miniature face of the Apple Watch.

If done properly, the watch could provide rich marketing opportunities. If done incorrectly, ads on the small screen could easily cross a boundary between being helpful and being intrusive and annoying.

We know that the more personal a device becomes, the more sensitive consumers feel about viewing ads on it. By definition, a smartwatch is a highly personal device that’s worn on one’s wrist throughout the day, not carried in a pocket or purse. Therefore, it will require a uniquely personalized approach to advertising.

Not so long ago, marketers were forced to develop smaller ad formats that fit onto smartphones rather than desktop computer screens. This shift to mobile advertising marked an important breakthrough by enabling advertisers to forge closer relations with consumers. The smaller mobile form factor was extremely convenient for users, yet it presented problems for marketers trying to get their message across.

Now, with the Apple Watch, that same message has to be clearly conveyed on a two-inch-wide watch face.

The precise format for smartwatch advertising has not yet emerged, but it will no doubt require some optimization technology to personalize the mobile content and promote deeper consumer engagement. This challenge must be solved because mobile ads will continue to gobble up an ever-larger percentage of spending for digital marketing. And, due to their easy accessibility, smartwatches will grab a considerable share of computing time away from smartphones.

The small size of smartwatches makes it likely that advertising on such wearables will serve a supplementary role to augment smartphone ads, rather than replacing them. It will be more effective if notices on the watch are linked back to associated ads on the phone.

The real utility of the Apple Watch involves its capacity for consumers to quickly check all their notifications, events, locations, and personal activities with a quick glance at their wrists, or by communicating to the watch directly through voice commands or simple touch interactions.

In some sense, the watch will then become a kind of alert center that notifies users about special offers they can access on their phone screens, such as discounts for oil changes just as they pull into the car dealership for a tune-up. Or, maybe it will be a lunch appointment notice that links back to a coupon for the restaurant they are about to visit.

Software developers will use WatchKit, a development platform for the Apple Watch, to build compelling new apps in areas such as health, entertainment, gaming, and messaging. But in-app ads that worked well on the smartphone will now be too large for the Apple Watch.

New apps will benefit advertisers most when they are highly personalized, based on the user’s location and past behavioral patterns. Consider health-based applications on the watch, such as heart monitors, blood pressure readers, or pedometers for workouts. Makers of health and wellness products could point out a spike in cholesterol levels with a simple heart symbol on the watch, which then links back to an offer on the phone for a new cholesterol-blocking remedy

It’s clear that advertisers must find creative new ways to personalize ads on smartwatches without alienating users. This delicate balance will be worked out as marketers learn more about consumer preferences through trial and error. But, with the Apple Watch due out in early 2015, there’s no time to waste for advertisers to get smarter about smartwatch advertising.

Shekhar Deo is cofounder of EngageClick, a digital marketing and customer engagement company that launched in 2012. Deo has extensive product development experience in distributed systems, clustered systems, and data storage technologies from his prior roles at NetApp and Cisco.