No, it is not time to freak out over ad blockers, but publishers shouldn’t be caught unprepared
A report from PageFair and Adobe, along with the September release of iOS 9, has some in the media concerned about the fate of mobile advertising… though publisher’s real concern should be about delivering a high quality reading experience
There has been a bit of a freak out by the media in the last week or so over the prospect that ad blockers could seriously impact their businesses. That is, that a majority of web readers will soon be employing browsers with ad blocking built-in, and that the world as they know it will disappear.
Then again, it probably isn’t publishers freaking out so much as media reporters who have suddenly become aware of ad blockers and think it is the next big thing.
So here is some thoughts on why digital publishers shouldn’t start tearing their hair out – just quite yet, anyways:
The missing $22 billion
PageFair and Adobe released a study on Monday that states that $21.8 billion will be lost due to ad blockers (see PDF here). It is an eye-opening number, and one that soon media reporters began to repeat unquestioningly. The report states that revenue figure is derived this way:
Potential digital advertising revenue was calculated by dividing the reported revenue for 2014 (source: eMarketer) by (1- the ad blocking rate in a particular country). Blocked advertising revenue was estimated as the difference between potential and reported revenue.
Since it is an estimate, and the first one I’ve seen that tries to put a dollar amount on lost revenue through ad blocking, I will not dispute it. But I will say that ad dollars not spend online in one place have a tendency to be spent elsewhere. In other words, if an advertisers is trying to reach X million readers, they will do so by upping the impressions bought or not counting the lost impressions.
For the publisher, of course, those lost impressions could be costly. The question ends up being, who will lose the impressions?
iOS 9 and Safari
One of those that picked up on the new report was AppleInsider, which splashed the $22 billion figure in its headline. The website’s story is centered on the fact that next month Apple will be releasing the next generation of its mobile operating system, iOS 9, which promises to expand the use of ad blocking even further.
The claim is that the next generation of Safari will allow for ad blocking on mobile devices, and since Safari represents so much of the web traffic coming from mobile devices – over half of all traffic coming from mobile devices, it is claimed – that this may seriously impact the ad impressions coming from mobile readers.
In theory, this is true. But you have to understand the mechanism that would make this happen. iOS 9 will not block advertising on iOS devices by default, but will allow the end user to install ad blocking extensions. This means the reader needs to go about finding and installing the extensions, and then use them.
Will that happen? No doubt. How frequently? That is unknown. But if I were to guess, I would say that heavy users, those most tech savvy, will choose to use ad blockers regularly. The most tech savvy will likely toggle them on and off as necessary, though I think most will either use them, or not. Others, however, rarely mess with their systems, use the default browsers unchanged.
Readers opinion of web advertising… not good
It is now common wisdom that readers hate web advertising – at least among the tech crowd. In fact, most of the media reporters I see writing have decidedly negative views of advertising, in general. Not surprising as they are in the editorial department. But many publishers hold the same views.
More and more, magazine and newspaper companies are run by those with editorial backgrounds, not advertising backgrounds. Without pointing the finger at any one media executive, look at who is running many publishing companies today and ask yourself this one question: do you think this person has ever sat in front of an advertiser and pitched ad space, with their own ad quota to be reached?
The reality is that readers don’t hate advertising, editors and reporters just think they do. Readers hate bad advertising, irrelevant advertising, obnoxious advertising. And there is plenty of that out there today, and publishers are to blame.
“I’ve never been tempted to run ad-blocking software before — I make most of my living from ads, as do many of my friends and colleagues, and I’ve always wanted to support the free media I consume,” wrote programmer and blogger Marco Arment this week.
“But in the last few years, possibly due to the dominance of low-quality ad networks and the increased share of mobile browsing (which is far less lucrative for ads, and more sensitive to ad intrusiveness, than PC browsing), web ad quality and tolerability have plummeted, and annoyance, abuse, misdirection, and tracking have skyrocketed.”
I recognize the problem right here at TNM. Some of the ads displayed come from Google AdSense, and most of the time, because I spend so much time on media sites, the ads are relevant. But I, too, get underwear ads, and other irrelevant ads when I am on this site. I’m sure you do, too, and it really bothers me, and I know it suppresses the number of clicks TNM receives, and costs this site money. But I’ve tried other ad networks and found that not only do they pay less than Google, but they do not deliver relevant advertising.
But bad advertising is everywhere – from pop-ups to auto-play videos. Then there are those “You May Like” or “Around the Web” styled ads, that no doubt generate clicks, but most readers feel they can do without. Especially if they cause a site to load more slowly.
But I would caution you about buying into the idea that “everyone hates advertising” – it’s not true, and every magazine publisher should know this. What would any fashion magazine be without the advertising? Don’t readers expect construction equipment ads in their B2B construction magazine? If they feel this way about their print magazines, why can’t we make them feel this way about our magazine and newspaper branded websites?
There is a story I often tell about a manager’s meeting once held at a Los Angeles weekly newspaper. The editor took the opportunity to criticize the ad manager for the quality of the advertising appearing in each issue. The ad manager defended the advertising saying that half the readers pick up the newspaper for the ads. The editor responded, saying he was wrong. Then when the ad manager tried to defend himself again the publisher stepped in.
“Sorry, you’re wrong,” the publisher said to the ad manager. “It is not true that half of our readers pick up the paper for the ads,” he said. “The latest reader research says that 80 percent of readers picked up the paper for the ads!” the publisher said, to the great disappointment of the editor.
Advertising slow down the web
For the past couple of years a few tech sites have noticed just how slow the web is getting. But the situation has gotten much worse of late. So bad that even CNN has taken notice.
“It’s not you. Web pages really are loading slower,” CNN Money said recently.
“Websites are adding more attention-attracting videos, images, interactivity plug-ins (comments and feeds) and other code and script-heavy features that clog up broadband pipes and wireless spectrum,” CNN said in trying to explain why websites are so slow.
Part of the blame can be placed on publishers, and their own website builds. This simple comparison between website errors is self-explanatory, websites today contain more pages with errors than in the past:
Frédéric Filloux wrote about this just last month in a Monday Note post.
“Websites designers live in a bubble, they’re increasingly disconnected from users. Their work requirements include design (fonts, layouts elements), advertising (multiple ad serving and analytics), data collection (even though most sites collects way more data that they are able to process), a/b testings, and other marketing voodoo,” Filloux wrote.
Later, in the comments, Fillouox clarifies his claim so as to not put all the blame on the designers.
“Web designers are basically powerless,” Fillouox wrote. “They have to deal with numerous stakeholders — sales people, marketing gurus, newsroom — that they are no longer accountable of a site’s performances. Between an ad/marketeer and a tech guy, guess who the MBA in the C-suite will listen to? We all know this is a short term view: If sites’ performances continues to deteriorate, audiences will flock to those who assign a high priority to speed, namely Facebook, Apple and Google.”
Filloux then illustrates the attraction of ad blockers: they significantly decrease load times. News sites such at The Guardian and Huffington Post load at vastly faster speeds once an ad blocker is employed.
One can understand the fear that ad blockers will seriously impact digital publishers, and the changes Apple plan to make with the release of iOS 9 will only lead to further gains in this area. But there are choices publishers can make right now to make sure readers are happy with their websites, and the advertising that appears there.
It is also important to understand that when one form of advertising declines it does not mean an overall decline in ad dollars being spent. Just as print ad dollars migrated to digital, and from one form of digital to another, ad dollars that leave the mobile ad space will show up someplace else. Marketers need to market, after all, and media agencies need to spend those dollars… somewhere.
But we continue to deal with the fact that digital advertising basically sucks. Between pop-ups and auto-play video, readers have a good reason to want to avoid the advertising publishers place on their websites.
“Ads have evolved from being “annoying” to downright in-your-face,” one readers wrote in the comments to the AppleInsider story on ad blockers. ” I hate it to the Nth degree. I lost track of the number of websites I attempted to visit, only to shut the window down because the ads were so over-the-top cluttering everything.”
“The current model is broken. Kudos to Apple for giving the finger to advertisers.”
Well, Apple isn’t giving the finger to advertisers, they are doing what they always do: making sure they are providing a good user experience for those who buy their devices. But if Google loses a few ad dollars over the issue of ad blockers, I’m sure Apple wouldn’t mind in the least.