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AOL shifts strategic focus to tablet, mobile-first monetization

AOL, a company that once almost exclusively ruled the desktop Internet, is now shifting its focus to mobile and tablets, claiming that the devices' monetization opportunities surpass those on the Web. 

The company has steadily built up its mobile strategy over the past year with the introduction of mobile and tablet experiences for some of its biggest brands, including Moviefone, Huffington Post, Engadget and MapQuest. AOL also recently introduced two tablet magazines ? Distro and Editions ? and will invest more heavily in creating tablet- and mobile-first experiences going forward.

?Our first foray into this is creating tablet- and mobile-first experiences and this is an area where we will invest in even more heavily going forward,? said Trent Herren, Palo Alto, CA-based head of monetization for AOL products.

?As we think about Moviefone, MapQuest and Engadget, we are seeing traffic go from the desktop to different devices,? he said. "On the tablet, we think we will be able to monetize better than we can on desktop.

?On mobile, we will probably be able to monetize on par with what we are doing on the desktop.?

Speedy adoption
Part of the interest in tablets stems from how quickly consumers are embracing them, especially the iPad.

AOL reports that more people go to Engadget on a mobile device than on desktop and it expects this trend to continue. For its Moviefone app, which is geared toward watching movie trailers, AOL sees more video consumption via the iPad than online.

?We thought the iPad was going to be really, really big and as we look at the numbers, it has actually grown more quickly than we thought it would,? Mr. Herren said.

The recently launched Editions is a good example of the kind of tablet experiences AOL wants to develop.

Editions is a personalized daily tablet magazine that provides readers with a selection of articles based on their interests. The idea is to address consumers who surf around the Web without much purpose.

?What we want to do is present a very curated experience every day,? Mr. Herren said. ?Our hope is that we build more engagement and more usage because when people download and open Editions on a daily basis, they are impressed that we are curating the types of articles that they want to see.?

AOL also recently introduced Distro, a weekly tablet magazine for the Engadget technology blog that features eight to 10 articles from the blog.

Media consumption habits
Mr. Herren said it is possible that AOL will create something similar for Huffington Post and some of its other properties as it looks to address the way that tablets are changing media consumption habits.

?What we?ve seen with the iPad is that people lean back to engage,? Mr. Herren said. ?It is how people start their day and end their day. It is changing the consumption of content.

?We are monitoring very closely how people are using these devices and how they are consuming content and applications in a different manner to make sure we have experiences that match that,? he said.

Editions launched at the beginning of November with a 3D ad from BMW that was ran exclusively for three days. An ad from Autodesk was then also included. 

AOL expects to have two or three ads appearing in Editions for December. Going forward, it hopes to have at most one 3D ad and several full-page interstitial ads and half a dozen or more ads per month in a year.

?It takes a lot of time to develop these ads, especially 3D ones and especially if we want to make them really high quality,? Mr. Herren said. ?So, we are rolling this out very slowly.?

While the focus is currently on the iPad in the tablet space, AOL will develop for other platforms as they get bigger. The company is also looking into bringing out more smartphone experiences as well as at creating unique mobile advertising experiences around gaming and its instant messaging service AIM.

Targeted reach
The focus on tablets could offer advertisers a way to reach specific audiences.

?There are a group of advertisers that wants an entertainment audience and a group that wants a finance audience,? Mr. Herren said. ?We think by creating these daily and weekly magazines, we?ll be able to deliver the right audience and the right experience to our advertisers.

?If we create unique experiences that are tailored to specific audiences, it will be easier for us to sell,? he said.

Tablets also offer a bigger screen and strong engagement opportunities. 

?Editions is a beautiful daily magazine and we want the ads to be at least as high quality as the stories that are in the daily magazine so we are investing aggressively in this area,? Mr. Herren said.

?Tablets are conducive to bigger ads,? he said. ?If you look at some of the tablet experiences today, you can charge a lot of money for them.

?As an advertiser, a person on an iPad is most likely to be a little bit more engaged with your brand if you can create the right type of asset.?

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York