ad blocker
POSTED : May 19, 2016
BY : Loren Bors

Video ads, mobile ads, retargeting… the complexity and variety of online advertising boggles the mind. Until the mind downloads a simple, often free ad blocker and shuts off the videos, cuts out the sound, kills the flash animation and quiets the screen. Nothing between the reader and their listsicle.

According to a study published this week by Optimal, an analytics firm, ad blocking in the US is at about 11% today (below the global average of 14%) – that is, 11% of web traffic is viewed through browsers that have some form of ad blocking or filtering. Optimal predicts ad blocking will increase drastically – radically – to nearly 50% by 2020, resulting in a loss of almost $12.3B in revenue. The free nature of ad blockers and the rapid rise in awareness of their efficacy will drive adoption, according to the study.

How accurate is this forecast? It extrapolates several trends. First, the study assumes that ads will continue to be served in the manner they are today: through browsers as embedded code. Sites like Facebook and mobile apps, where people are spending an increasing amount of their time online, are much more difficult to modify than a web browser interface. Such walled gardens are expected to fare better than the open web, where publishers may go as far as preventing access to their webpages if ad blockers are detected.

Second, ads are becoming increasingly enmeshed in the content itself. If you’ve ever seen a billboard on the side of the pitch in an online soccer game or on the outfield fence in the latest MLB console game, you’re sometimes seeing ads placed dynamically in your game. Product placement is powerful, especially as users demand increasingly authentic digital experiences. Furthermore, because many video games have a consistent feel and message (like a sports game), advertisers need not worry about brand damage. The environment they inhabit is completely sanitized. Unlike the web, where an ad for a brand can appear as a banner over an article describing said brand’s recent malfeasance or a cautionary tale about similar products.

Finally, video has become a dominant medium on the web. The length of ads played before and during video content is only increasing, especially for the most popular shows. For all the talk of cord cutting, consumers seem much more willing to sit through ads during a video than sort through ads transforming a webpage into a losing game of Tetris.

Let’s put the other form factors aside and just look at web ads. While advertisers have a legitimate concern they will lose revenue if people alter the configuration of a page as it loads, the rapid growth of ad blockers themselves could be interpreted as a market signal from consumers to publishers and ad creators. Namely, the loud, autoplay, auto-insert, full page, impossible to close ad splashed across the screen during work hours in an open office setting is a less-than-optimal experience for viewers of news sites, sports sites, some email services, retail sites, etc. Placing the user, rather than ads, at the center of a brand’s web experience will help ensure loyalty in an age of searchable, commoditized content.

So, advertisers and publishers: the rise of ad blocking technology is definitely a threat to your business model as currently developed. In this case, though, that ad blocking is also the voice of your customer. And it’s telling you to dial back the ads. Less obtrusive ads supported by programmatic marketing platforms are still more relevant and more likely to result in action from a consumer. Invest in relevance and timing, divest from technologies designed to overwhelm the user experience. It’s not an arms race you’re likely to win.


About the Author

A picture of Loren BorsLoren Bors is a Manager at PK, where he helps businesses attract, grow and retain customers. Loren has worked with companies of all sizes and types, from the B2B software Fortune 50 enterprise to the four-person startup, and specializes in assessing market opportunities and designing programs that engage with customers on their terms.

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