Henry Stokes
Feb 14, 2017

The age of ad blocking

22% of global smartphone users now use ad block software, that number is set to rise in the near future.

The age of ad blocking

Have you ever been served ads that provide no purpose for your needs or interest?

With the increase in mobile consumption and advancement of technology, consumers are bombarded with more ads than ever – not just on different devices, but also on different apps and media platforms,

The result of this has been the birth of an increasing number of ad blocking software/apps. There are now many choices of apps or software that you can download, with each having their own ad blocking parameters. Some serve as sweeping blankets, while others have limited restrictions that only allow static, text or non-obstructive ads on different platforms.

According to a study by the consulting firm PageFair with the analytics firm Priori Data, 419 million people, or 22 percent of global smartphone users, are blocking ads on their mobile handsets as of March 2016. This seems like a resounding public show of disapproval that publishers/advertisers should take note of. Of course, when Apple announced that it was incorporating a mobile ad blocking software into its iPhone and iPad iOS9 operating system, it increased access and accelarated the growth even further.

But are consumers too quick to block out the bigger picture?

Why the need to block?

First things first, it’s important to understand why consumers are choosing to block ads. Survey’s undertaken by both media owners and research companies alike indicate that the top three reasons are: quantity of ads, the increased data consumption they demand, and impacts on speed of the consumers device.

The study also showed that mobile ad-blocking grew by 90 percent globally in 2015, with most of the increase in Asia, and this will cost publishers billions of dollars. There are so many brands now vying for attention, there aren't just more ads, but ads have also become more intrusive and harder to filter out of your normal user experience. This is not only disruptive to the user experience, but it also means an increase in phone data consumption.

Where unlimited data bundles are not the norm, and when much of content is consumed on mobile, an unwanted ad could be an added cost to the consumer or result in a lack of data for important social networking! God forbid an advertiser to be seen as the culprit for lack of social media activity!

Naturally, as more data is being pushed through the gates, it affects the speed of the working device. All of these provide more reasons to get that ad blocking app/software installed. In addition, unwanted ads could possible infect a users device with a virus. Based on a 2014 IAB study, consumers find themselves using ad blocking technology to protect their respective devices against viruses and to increase their computer performance.

So using ad blocking apps/softwares is a great move for a consumer, right? Well, not exactly.

What is the impact of this?

Let's imagine a mobile world where almost everyone has decided to use ad blocking apps/softwares to extensively block ads.

With an abundance of ad blocking,the cost of advertising will likely go up – simple demand vs supply. Advertisers will be forced to reconsider the efficiency of their return on investment and could pull out of digital advertising as a result. Alternatively as with consumers only the rich advertisers will be able to afford it and in turn, smaller businesses would suffer

But don’t most small business use the self service options through Google search and display network or Facebook? Will these more native based ads also be affected so impacting the small business owner? Simple answer is yes, apps that block all ads including native ads are available. Paid search is still excluded from this.

What about the consumers (they should come first!). Well they could have to start paying for what used to be 'free' ad funded content. This essentially means that the 'free web' as a tool for universal education and social mobility could be impacted. Only the rich will be able to pay for the best content. As always, freedom does not result in equality.

Secondly, smaller indie sites where people have been enjoying free, cool and alternative content , will either shut down or struggle to keep going because people won’t pay for their content and they can’t make money from ads.

Lastly, the quality of ads and hence user rich audience visual experience could be affected as some ad blocking apps only allow text or static ads.

Hopefully, the above scenarios will not be realised. The web has been funded by ads since its inception, well 1994 at least, when AT&T ran the first 468x60 banner ad on Hotwired.com. To alter the status quo now would result in a huge correction in the economics of the web. Fundamental things would have to change. However, the mere point that we as an industry are still finding advertisers money to buy 468x60 banner ads is a major concern and a clear indication that things have to shift towards making ads better looking, more targeted, more relevant and hopefully more welcomed by the consumer.

So what next?

There have been various different responses by media companies to the issue of ad blocking. Firstly, the approach to accept and comply, and as a result the industry must do a better job of producing and delivering ads that are less annoying. I believe this has a lot to do with increasing entertaining video ads or content related ads.

 "Nobody reads ads, they just read content and sometimes they happen to be ads." — Howard Gossage

The second approach is to engage with consumers and explain the value exchange of ads for free content. This is something that The Guarandian has undertaken. Finally the most dramatic and hardline approach is to block the blockers. This has been adopted by Axel Springer in Germany with amazing results where 66 percent of users chose to turn off ad blocker as a result. Only vendors with exclusive content can take this approach.

No single solution is being deemed the right way to go yet. What is clear is that consumers want change and want ads that are relevant to them at a time when they need it and in a manner that is not intrusive to their online/mobile user experience. According to an IAB study, 60 percent of current ad blocker users would turn off ad blocking for content, proving that to get to better content, consumers are willing to experience relevant and better targeted ads.

There is no need for panic but there is need for change. Targeting has improved, content-based entertainment ads have improved, and video advertising is increasing. There is no doubt in my mind we must become a more responsible advertising industry. It is not all down to the media vendor – agencies, advertisers and technology companies must all pitch in. We must give consumers the freedom to choose which conversation they'd like to be involved in and to deliver better quality both in terms of format and message, with less clutter. I believe if ads are served in this manner, they will have a higher impact.

Henry Stokes, APAC Vice President, Xaxis Client Development 


Campaign Asia

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