Online Advertising Web Analytics

Ads are dead, long live ads!

Lamia Bakhalek
Written by Lamia Bakhalek

According to many news media, ad blockers would have turned the Web into a battlefield. These publishers accuse ad blockers of wrecking their business model by decimating ads and depriving them of their main source of revenue. Some of them even speek about a war that will lead to the end of the free web. Seriously? Let’s face the truth, those who virulently denounce ad blocking, also are those who are the most affected by this growing trend. On the other side, users don’t share the same feeling at all. Proof is the exponential increase in the number of ad blockers adopters. 

So, Web’s ennemies or saviors? Probably none of them. The real question is: why ad blockers have become so popular?
Eventually, is advertising the best solution to monetize content on the Web?

The unstoppable rise of ad blockers

The use of ad blockers is skyrocketting globally. As you can see on the chart below (from a study by PageFair and Adobe), the rise of ad blocking is impressive. With the proliferation of players coupled with the strong enthusiasm of users, the ad blocking market is expected to keep growing fast. According to a study released in 2015 by SourcePoint and comScore, the use of ad blockers is widespread in Western countries, espacially in France (27%) and Germany (24%) where online privacy concerns are high. And penetration rates are even higher among young people: 56% of Millenials are using ad blockers. However, the rates are still very low on mobile in Western countries since ad blocking has been enabled on iOS9 quite recently: only 1% in the US and 0.2% in France. In Asia, the rate is much higher: 9% in India, 7.9% in China.

Ad blockers : study from PageFair and Adobe

The reason behind the rise of ad blocking is quite obvious. Users hate advertising. In magazines, ads are inert and you just have to turn the page if you don’t want to look at them. On TV, never-ending commercials are a little bit more annoying but still, you can change the channel.  Ads are way more unbearable online since they are both interruptive and intrusive. Ads can cover your whole screen, pop up, move, make sound, use your personal data… What a nightmare! And on top of that, ads are sometimes irrelevant, despite efforts made by publishers to target their audience.

There’s also another reason. On mobile devices, ad load tends to slow down your browser and reduce your battery life. As a result, millions of users download ad blocking apps such as Adblock Plus and Crystal. Some of them even choose to install lightweight browsers such as UC Browser and Brave which activate ad blocking by default. See how it works:

But ad blockers don’t remove ads only. They can also block tracking codes, sometimes by default. It’s a serious issue for marketers who are probably going to face an important loss of analytical data. It will affect user behavior analysis. Here is a very good article dealing with the impact of ad blockers on Google Analytics.

Ad blocking may be a symptom of a bigger issue: the lack of privacy on the Internet. Users don’t feel safe because they know they are tracked. If you remember, we talked about that in a previous article! Ad blockers simply give to users a quick and easy way to take back control of their personal data. Benefits are huge for users: they aren’t bothered anymore, page load is faster, battery life longer.

Ad blockers : study from PageFair and Adobe

Now you may think ad blockers are some kind of “vigilantes of the web”, caring about users. But don’t be fooled. They are not “nice guys”. Some of them are nonprofit blockers. And some others are just using the motive of right to privacy to do business.

The Publishers strike back

For the moment, not really. They are on the defensive. Yet $21.8bn of ad revenue were lost in 2015 and this cost is expected to increase to $41.4bn in 2016, according to PageFair and Adobe. Although publishers acknowledge the problem, little is done to tackle it.

The common tactic consists of denying access to users who are activating ad blockers. To be allowed to read the content, you have to whitelist the website or suscribe. That’s exactly what Forbes is doing. The website was even blocking suscribers using ad blockers but they have just changed that as you can see on the screenshots below. It’s a dangerous tactic since users can decide the site isn’t worth it and leave. As a result, bounce rates will increase dramatically.

Ad blockers and Forbes

Wired is less categorical and tries another approach to lure users. The publisher lets you start the reading then deploys a paywall. It’s a smarter tactic since once the user is focused on the content, he is more likely to stay.
Ad blockers and WiredSome publishers hold onto ads revenue and decide to bypass ad blockers thanks to anti-ad blocking solutions like Secret Media. The “block the blocker” tactic is a vain attempt. These publishers should focus on real solutions.

Some others collude with the enemy to join the closed group of “acceptable ads”. The Financial Times reported last year that Google, Microsoft, Amazon and Taboola are paying huge fees to Adblock Plus to be whitelisted by default.  

Ad blockers and Google AdWords
In this war, there are collateral damage. E-commerce websites. Let me tell you about my shopping experience on cosstores.com. I didn’t want to register so I clicked on “Checkout as a guest”. CTA was not working. I thought it was a tactic to make me create an account. It pissed me off. But ok I registered. Then checkout and time to press “Place order”. Not working, again. I refreshed the page. Still not working. And then I thought: “could it be because of my  Adblock Plus plug-in?”. So I whitelisted the website. And guess what? It worked.
It means that ad blockers can infringe on UX and may have an impact on drop-off rates too… It would be interesting to know how many e-commerce websites are affected.

Proliferation of ad blockers has gone so far that it’s counterproductive trying to stem the bleeding. What if publishers stopped considering ad blocking as a threat but rather as an opportunity?

What future for advertising and publishers?

Advertising is experiencing a major shift. Ad blockers are forcing publishers’ hand to adapt to consumers choice and to change their business model. It’s an opportunity to innovate and find new ways to monetize content.
Here are 5 potential solutions: 

1. Less is more

Marketers should focus on quality rather than on quantity. They need to improve ads relevance. Millions of impressions mean nothing if your CTR is equal to 0.001%!

How to be more relevant? First, publishers should review their ad expenses and optimize their budget. Second, they probably would need to better analyze their data and understand user behavior in order to improve targeting. Most of the time, remarketing techniques are missused. That’s not because I visited a car manufacturer’s website that I’m actually planning to buy a car! Third, publishers should challenge their media agency. They need to have more visibility on how the budget is spent and how these agencies optimize ad campaigns. Fourth, they should bannish intrusive ad formats as pop-ups, autoplay and insterstials.  

2. Native Advertising

Quality is also a matter of look and feel. Ad blockers don’t block so-called “acceptable ads”. So publishers can take advantage of it. Non-intrusive ads, are ads that blend in seamlessly with content like in-feed, in-read ads or even sponsored blog posts. But publishers have to add a clear label so users can easily make the difference between non-promoted and promoted content. Otherwise they might feel duped and not trust the website anymore. BuzzFeed tried to use native ads. But according to the Advertising Standards Authority, they were breaking UK ad rules because it wasn’t clear enough.

3. Valuable content

Users don’t want their favorite websites to be in pain or die because of them. Websites offering great content and UX are more likely to be whitelisted. 

Some publishers like Numerama are reacting in a funny way. On the first banner, you can read: “Here lies an ad killed by Adblock. But as we love you, we replaced it with a smile.”
On the second one:
“These 91,200 pixels are supposed to be an ad space. If you can read this, it means:

  • The Death Star destroyed our CSS
  • Pixels have been swallowed by the Sarlacc
  • You are in a far-off galaxy and news media are finally living in an ad-free world
  • You are using Adblock

Anyway, enjoy your reading”

Ad blockers and Numerama

4. Deep-linking

Publishers should take this opportunity to focus on apps. Ad blockers only work at the browser level, which means they can’t affect apps. So why not drive more users into apps? Thanks to deep-linking, publishers can either send users to their app (if they already installed it), or ask them to download it for an enhanced experience. Publishers would also have to improve ads’ quality in applications.

5. New monetization models

Some publishers are relying on subscriptions to premium services. Wired developed an ad-free service. To encourage users to suscribe, L’Equipe is offering a 15-day-free trial to all users who accept to whitelist the website. L’Equipe reached a whitelisting rate of 40%.
The Guardian chose not to block access but the website encourages users to become “supporters” by paying 1$ per week to get rid of ads.

Ad blockers and The Guardian

 

Ads, as we know them, are dead. But they will be reborn, in a new form: less intrusive and more relevant. Ad blockers are now part of the digital landscape. Publishers have to accept it. Now they should focus on the impact of ad blockers on their platform (loss of revenue, loss of analytics and sometimes poorer UX) and start to work on a plan. As Tom Goodwin said: “Adblocking may be the best thing for the advertising industry. A chance to rise to the challenge, create more meaningful connections and serve people better.”

About the author

Lamia Bakhalek

Lamia Bakhalek

Hi! I am Lamia and I am studying Digital Business Strategy at Grenoble Ecole de Management (GEM). I am also currently working as a Digital Performance Consultant at Webedia