The ABC’s of Ad Blocking

Posted by on September 13, 2015 in Advertising, Post To Home Page | 0 comments

The ABC’s of Ad Blocking

Although ad blocking has been around for years, it has typically been regarded as a nuisance for news media trying to scrape together enough digital dimes to combat the rapid decline in print advertising.  But suddenly it seems to be invoking fear and loathing in the hearts and wallets of online publishers.

Taking a look back at where ad blocking began and where it is going, it’s not hard to  understand why ad blocking has stirred up the media frenzy of late…

What is ad blocking and why is it suddenly such a problem?

Ad blocking extensions originated within online gaming circles, where interruptive pop-ups and other advertisements drastically affected the gamer’s experience. The incentive was two-fold based on basic irritation and poor page loading times. It wasn’t until more recently that these extensions, which place a firewall between the website and the advertisements, began to seep into the average internet user’s browser.

Today 198 million people globally  are using ad blocking software; including about half of online users in the US and UK. Thanks to the digital savvy millennial generation, ad blockers are becoming mainstream and the repercussions are becoming more than just a nuisance to advertisers and publishers alike.

Ad blocking in action

BEFORE AND AFTER AD BLOCKING

 

Big corporations are poised to rule the world wide web

Earlier this year, Google came out with an AdBlock Plus Browseran Android browser that blocks ads by default. Not to be left out of the ad block party, Apple is about to release its very own ad blocking extension for Safari on iOS alongside its new Apple News app—a replacement to their fallen Newsstand that gives readers the personalized content (ads included) of their choice.

Soon publishers and other tech titans will have no choice but to pay the green giant a hefty price to display their ads in Apple News and Safari as they already do  today with Eyeo.

News of the proverbial “whitelist” made the struggle to monetize digital advertising feel that much more difficult to, well, everyone else. Adobe estimated that $21.8 billion in global ad revenue will be blocked this year, while The Drum predicts that ad blocking software will cost publishers $40 billion or more by the turn of the calendar.

Mauricio Freitas, the Publisher of New Zealand’s Geekzone, has said what most advertisers are thinking:

“Viewing ads is part of the deal if users want content to be free.”

Unfortunately, a whole lot of internet users would argue that point — one group in particular.

Millennials march to a different digital drummer

The millennial generation, those currently aged 18-35, are posing a particular problem to the online advertising industry. As the first generation of “digital natives”, having grown up hyper connected with smartphones, tablets, laptops and full time access to the internet and social media, millennials are more discerning, more tech savvy and more demanding than any previous generation.

This generation is incredibly adept at filtering out anything they don’t want.

“Millennials have been born and raised in the age of technology, and unlike past generations, they are not influenced by traditional “push” marketing strategies,”

explains Nora Ganim Barnes, Chancellor Professor of Marketing and Director of the Centre for Marketing Research at the University of Massachusetts Dartmouth.

Millennials want to be in charge of their own messaging, and that includes controlling with brands they follow, support and in turn, promote. The result is both simple and complicated: advertisers need to offer exactly what millennials are looking for or risk alienation from the ME generation.

So is there any good news?

Before you lose all faith in the future of digital marketing and monetization, consider these three positives:

  1. Changes to the digital marketplace will force improved advertising quality

As ad blocking continues to gain momentum, publishers and advertisers will be forced to improve the overall quality of their advertisements. In other words, industries and roles founded on creativity will be forced to innovate once again.

Perhaps it was the publishers’ enemy, Eyeo, who said it best:

“Bottom line: Let’s put down the world’s smallest violin and recognize ad blocking for what it is: innovation. Would anyone argue that online ads don’t need a little of that? Let’s get to work!”

  1. There are untapped advertising options that could offer true value to the reader

Michael Rosenwald describes ad blocking extensions as a sheriff, designed to determine which advertisements are valuable to the reader and put an end to the rest. That means that the job of the advertiser, more than ever before, is to develop ad campaigns with content that is truly beneficial.

Native ads and outstream video ads are two possible solutions, but, and this is a BIG BUT,  if they aren’t fully transparent or add no appreciable value to the viewer, they will soon be another “rule” in astronomer Carl Segan’s playbook…

“Extinction is the rule. Survival is the exception.” 

Native ads are designed to appear as regular content. This makes them both difficult to track by an ad blocker (today) and low on the priority list if identified. Often coined “advertorials” (for advertisement + editorial), native (or sponsored) ads have a mixed reputation.  Newspapers like the NYT love them; John Oliver loves to hate them.

Outstream videos (autoplay video ads that appear within editorial content) is also showing promise, capitalizing on the exponential growth of video, especially on mobile devices.

digital video advertising growth

Video Advertising CTR In a recent study by Forrester (sponsored by Teads), outstream video was found to be a potential game changer in online advertising with the following statistics as evidence:

  • 70% of agencies think digital video advertising will increase in the next two years
  • 25% of agencies think digital video spend will significantly increase in the future
  • Outstream ads were unanimously voted as most important to clients’ advertising portfolios

They’re lucrative, they’re void of limitations, and (if captivating) they’re incredibly shareable. Which brings us to:

  1. Once on board, millennials can be your best ally

Millennials are incredibly selective, but once a source, company, publication or product is in their good books they are keen to spread the word. Whether your advertisements appear on a website they trust, or you are the website they trust, context is key when it comes to catching the eye of this otherwise impenetrable group.

Advertising platforms have always been in constant evolution—it just takes a quick scroll through the infomercial channels to remind us.  Though ad blockers pose a significant threat to both publishers and advertisers, solutions will also evolve as these blockers mature.  The key to survival in the competition for eyeballs and ad dollars is to give consumers what they want — quality content (whether that be editorial or advertising) the way they want it, when they want it and how they want it.

It may not be easy, but it really is that simple.